Annuities are an increasingly popular investment vehicle that offers a range of benefits. Here’s what you need to know to decide if an annuity could be right for you.

An annuity is a type of insurance product that pays out a regular income stream. It's an agreement between you and an insurance company, where you agree to make a lump sum payment in exchange for a guaranteed, fixed stream of payments over a determined period of time.

An annuity can offer you a range of positive benefits over other types of retirement income plans. Here are some of the key benefits that annuities offer:

1. A steady income

Annuities are often used as income-generating investments that can provide you with a steady stream of income now and into the future. Depending on the type of annuity you purchase, you may even have the option of taking a lump sum payment instead.

2. Price protection

If you're looking for an investment that offers price protection, annuities can be a good way to go. A fixed annuity, for example, offers guaranteed payments that won't be affected by market fluctuations. If the market goes down, your payments remain steady.

3. Peace of mind

Some annuities offer an additional layer of security that can help you sleep better at night. Some annuities provide a death benefit that will pay out a lump sum to your beneficiaries if you die before the annuity matures.

4. Tax savings

Annuities can be attractive from a tax perspective since they may be partially or fully tax-deferred. This means you won’t pay taxes on any of the income or earnings generated by your annuity until you decide to take withdrawals.

Overall, annuities offer a variety of potential benefits for investors who understand their options and how a particular annuity works. When evaluating annuities, make sure you understand the terms, fees, and ongoing charges associated with any investment vehicle you’re considering to make sure it’s right for you.