Immediate Fixed Annuity

An annuity is like a Term Deposit. But this is with an Insurance Company and not with a bank. These are typically long-term contracts with an insurance company. In return for your investments, the company will pay you a fixed amount of money after a certain period of time or a guaranteed lifetime income. 

The most fundamental kind of annuity is an instant annuity. You contribute in one single payment. It is transformed into a consistent, assured stream of income that is guaranteed to last for a certain amount of time (as little as five years) or for a lifetime. Within a year, withdrawals can start.