Having Relatively Low Risk Investment with Annuity

You might have been wondering about the term annuity, or may be some of you have heard about it yet do not really know exactly what the term is all about. Annuity is part of investment thing. It is actually other term for annual payment which someone is usually done. In line with such term, annuity is categorized as certain amount of payment which is paid annually within regular intervals. People usually buy this annuity from any insurance company.
The way of payment can be done in two ways, including deferred annuity which means that the payment will be not started until later date and immediate annuity which is paid right away. Instead of two payment ways, annuity or such annual payment is divided into two types. The two types are including fixed annuity and variable annuity. In fix annuity contract is made with fixed dollar payment which is established by the insurance company.
Such annuity is usually used until the annuitant is dead where the insurance company gives guarantee in terms of earning and principal. In variable annuity, minimum payment will be given by the insurance company at the end of accumulation phase which income depends on annuity investment portfolio owned by the annuitants. Unfortunately not many people aware of benefits given by such annuity or annual payment investment, since they do not know that such annuity provides low risk investment if it’s done with decent rate of capital appreciation.