Type of Annuities

What is an Annuity?

An annuity is a contract between you and an insurance company in which the company promises to make periodic payments to you, starting immediately or at some future time. You buy an annuity either with a single payment or a series of payments called premiums.¹

The different types of annuities are:

  1. Fixed Annuity, often called Multi-Year Guarantee Annuities (MYGA)
  2. Fixed Index Annuity 
  3. Variable Annuity
  4. Registered Index Linked Annuity
  5. Immediate Annuity

Single Premium Immediate Annuity


Any annuity whose lifetime payments begin within the the first 12 months of contract issue is considered to be an immediate annuity. All other annuities are termed as a deferred annuity. You may hear of a Single Premium Immediate Annuity referred to as:

  • Income Annuity
  • Immediate Annuity
  • SPIA
Fun annuity fact - red sports car pulling sing that says annuities are a long term investment

Deferred Annuity

All other types of annuities are classified as a deferred annuity because the lifetime income payments are deferred for at least twelve months after purchase. Every annuity has can contractually be turned into a lifetime income stream of payments; however, many deferred annuities are purchased without an intent to ever turn them into income.

There are quite a few different types of deferred annuities:

  • Variable Annuity (VA)
  • Registered Index Linked Annuity (RILA)
  • Fixed Annuity 
  • Fixed Index Annuity (FIA)
  • Multi-Year Guarantee Annuity (MYGA)
  • Deferred Immediate Annuity (DIA)
  • Qualified Longevity Annuity Contract (QLAC)

Types of Annuities

Fixed Annuity 101

Your investment grows based on a guaranteed rate of return

Fixed Index Annuity 101

Upside potential with downside protection

Income Annuity 101

Turn a lump sum of money into a guaranteed income stream

QLAC 101

There's potential for more earnings, but you also take on more risk

Types of Annuities Comparison Chart

Types of annuities comparison chart

Discover the Value of Annuities

Lifetime Income

An annuity can provide you income for as long as you live through annuitization, which converts your assets into an income stream at no extra cost, or via an optional benefit rider available for an additional cost. Learn more about GLWB Riders (Guaranteed Lifetime Withdrawal Benefit Riders).

Legacy Planning

An annuity can provide you the opportunity to create a living legacy by preserving funds for future generations in a tax-efficient manner. Most annuities offer a standard death benefit of your full account value. However, you also have the option to purchase an enhanced death benefit rider that could increase the amount left to your loved ones (additional costs).

Spousal Protection

An annuity can be used to protect and preserve assets for a surviving spouse through death benefits and/or living benefits to sustain their ongoing lifestyle

Benefits of Annuities


Over time, annuities can accumulate with the advantage of tax-deferred growth. It lets you:

Delay paying taxes. Principal, interest, and capital gains may accumulate tax free until you withdraw them. The benefit is that, when you withdraw them during retirement, you’re likely to be in a lower tax bracket.

Build value. By delaying taxes until withdrawal, your account can retain more value. By deferring taxes, you can use the power of compound interest to boost the base of your account with each passing year. Over time, it can add up to more retirement wealth.


Some options offer growth potential. Here’s how:

You gain buying power. Some investments are beyond reach because minimum investment amounts are too high. Annuities can help because you’re in a larger group of investors.

You can skip fees or taxes. You may be able to exchange between investments without fees or tax consequences.

You can manage your investments yourself or use a money manager. It’s your choice.

Protect Who and What Matters Most

Annuities are uniquely designed to be able to provide you with lifetime income options, legacy planning and spousal opportunities. 


Lifetime income

It’s achieved through the use of annuitization at no cost or via a lifetime income benefit rider available for an additional cost.



Most annuities have a return of premium standard death benefit (your beneficiary gets back what you put in at a minimum), however, you have the opportunity to purchase enhanced death benefit riders that could increase the amount left to loved ones.


Spousal opportunities

You’re able to cover the life of your spouse on your annuity with a joint lifetime income benefit; please note that some carriers may charge a fee for these services.


Death Benefit

You can pass your assets to beneficiaries while avoiding the costly probate process. Married couples can also choose spousal protection

Immediate Annuity Advantages

Immediate annuities are a good option for those who plan to withdraw money in the first year, or for someone who has access to other retirement income and wants guaranteed income for the rest of their life or for a set period of time. Request an Income Annuity Quote

Tax advantages If you fund your immediate annuity with money you’ve already paid taxes on, you’ll have a source of income that’s partially tax-free.

Immediate You begin receiving guaranteed payments within the first year.

Customized guaranteed income Create income for either one or two people for a specific period of time or for life. 

Income You can receive a fixed, guaranteed amount on a set schedule. It helps, for example, if you want to budget living expenses over a long time, such as retirement. 

Additional features for added protection On some products, you may have options for a cost-of-living adjustment (to protect against inflation) and a liquidity feature (to allow lump-sum withdrawals in the event of a financial emergency). Liquidity benefits may be available for an additional cost. Keep in mind that not all annuity providers offer these features.

Fixed Annuities

A Fixed Annuity may be a good choice for those who want a guaranteed interest rate and principal protection. Shop fixed annuity rates

Tax deferral The tax-deferred status allows you to benefit from compounded growth.

Principal and interest protection It offers minimal investment risk exposure but still provides the opportunity to grow money at a set interest rate. The rates are generally higher than CDs from a bank. 

No market risk It offers guaranteed interest rates without exposure to market fluctuations.

Flexibility If choosing to annuitize your contract for lifetime income, you have the ability to choose from different payout options: set payments for a specified period or a lifetime stream of income.

Death Benefit You can pass assets to beneficiaries and avoid the costly probate process. Optional riders at an additional cost can enhance the amount that beneficiaries may receive upon the annuity owner’s passing.

Fixed Index Annuity Advantages

A Fixed Index Annuity may appeal to those who want a chance for upside gains in a good market while also receiving a level of protection from possible downturns.  Shop indexed annuities at our online Fixed Index Annuity Store

Tax deferral The tax-deferred status allows you to benefit from compounded growth.

Principal protection The original deposit will not decline if the index performs negatively. 

Lifetime income At an added cost, a rider is often available to guarantee set payments regardless of how long you and your spouse (if elected) live. Or, lifetime income can be achieved through annuitization at no additional cost.

Investment flexibility Growth potential can be achieved through the performance of the index or through a fixed interest rate earned on the fixed account — or a combination of the two. Your investment advisor can help you find the best combination for you. It’s good to know that a fixed indexed annuity is not an actual investment in an index; it’s only tied to the index performance. 

Earnings credited At the end of each term, earnings are credited; at that point, they cannot be affected by negative index performance. Some carriers offer a feature that allows you to take advantage of index highs during your term. 

Beneficiary protection You can pass assets to beneficiaries and avoid the costly probate process. Optional riders at an additional cost can enhance the amount that beneficiaries may receive upon the annuity owner’s passing.

Spousal opportunities Most companies offer spousal continuation only upon the first spouse’s death and don’t pay a death benefit until the second spouse passes. However, some carriers do offer a joint option that covers the death of either spouse upon the first passing.

Variable Annuity (VA) Advantages

A variable annuity may be a good choice for those who want the long-term opportunity for growth in the market and who are able to handle the risks that volatility. 

Tax deferral The tax-deferred status allows you to benefit from compounded growth.

Investment choices Unlike their fixed counterparts, variable annuities give you a chance for long-term capital growth through investment in subaccounts (professionally managed options that invest in stocks, bonds and other instruments).

Flexibility Choose from different levels of risk and potential growth. You can also, on some accounts, exchange between subaccounts without fees or tax consequences. 

Lifetime income Income you can’t outlive is obtained either through annuitization at no additional cost or through the use of an optional rider that guarantees income for a single person or to also cover your spouse when a joint option is selected.

Beneficiary protection You can pass assets to beneficiaries and avoid the costly probate process. Optional riders can also enhance what beneficiaries receive upon the annuity owner’s passing.

Spousal opportunities Most variable annuities offer a spousal protection feature to the surviving spouse upon the death of the other spouse. Only certain carriers can offer this benefit on IRA contracts.

Annuities are distributed by My Annuity Store, Inc. Guarantees are subject to the claims-paying ability of the insurer. My Annuity Store, Inc. does not advise clients on the purchase of non-fixed annuity products. The information presented here is not of tax or legal nature and is not intended to be a recommendation to purchase a fixed annuity, fixed index annuity, variable annuity contract, registered index linked annuity (RILA), immediate annuity (SPIA), longevity annuity, or Qualified Longevity Annuity Contract (QLAC). 

The contract features described may not be current and may not apply in the state in which you reside. Annuities are issued by Insurance companies and contracts are ‘state-specific’. Insurance companies also change their products and information often and without notice. Annuities are subject to the terms and conditions of the specific contract issued by the insurer, are not FDIC or NCUA insured, are not issued by a bank, may lose value, and are not a deposit. Please call (855) 583-1104 if you have any questions or concerns. 

The information presented here is not a representation regarding the suitability of any concept or product(s) for an individual and it does not provide tax, accounting or legal advice. It is important to read the prospectus carefully and consider your objectives, risks, fees and charges associated with the contract. You should always consult your own financial planning, tax, and legal counsel prior to purchasing an annuity. A fixed annuity, immediate annuity, longevity annuity, or Qualified Longevity Annuity Contract and variable annuities are issued by insurance companies.