Fixed Annuity
A purchased policy that pays a fixed amount of benefits every year for the life of the person or for a term of years. A simple life annuity provides benefits until a person dies, even if the death is premature. There is no final lump sum payment and no provision to pay benefits to a spouse or other survivor. A joint and survivorship annuity pays benefits to the annuitants during the period of their joint lives, with the annuity to continue to the survivor when the first annuitant dies. A fixed annuity is a type of annuity that provides payment of a specific sum of money at a fixed rate of return for a fixed period of time.
Tax Deferred Indexed Annuity
It is a form of annuity contract in which the employee contributions are not subject to taxes at the time of making contributions. Contributions are later taxed as they are paid out after retirement when the annuitant is presumably in a lower tax bracket. Thus such an annuity is also called tax sheltered annuity.
