fixed annuity

Fixed Annuity

An insurance contract in which the insurance company makes fixed dollar payments to the annuitant for the term of the contract, usually until the annuitant dies. The insurance company guarantees both earnings and principal.

Investopedia Commentary

A fairly good financial instrument for those looking to receive a fixed investment income.

Related Links

Anything But Ordinary: Calculating The Present And Future Value Of Annuities
Getting the Whole Story on Variable Annuities
Passing the Buck: The Hidden Costs of Annuities

See also: Annuity, Variable Annuity

fixed annuity

A stream of unchanging payments for a specific period or for an individual's lifetime, depending on the terms of the annuity contract. Fixed annuities are sold by insurance companies to people who desire a fixed income. Compare variable annuity. Also called guaranteed-dollar annuity. See also hybrid annuity.