Immediate Annuities
Convert your savings into guaranteed lifetime income starting now
What is an Immediate Annuity?
An immediate annuity is a straightforward retirement income solution that converts a portion of your savings into a guaranteed stream of income that begins almost immediately—typically within 1 to 12 months of purchase.
Think of it as creating your own personal pension. You make a one-time lump sum payment to an insurance company, and in return, they commit to sending you guaranteed income payments for a specific time period or for the rest of your life, regardless of how long you live or what happens in the financial markets.
Immediate annuities provide peace of mind by ensuring you won't outlive your money, making them particularly valuable for covering essential expenses in retirement.
Current Market Payout Rates
Immediate annuity payout rates as of April 2025:
| Age | Life Only | Life with Cash Refund | Joint Life (Same Age) |
|---|---|---|---|
| 65 | 5.5% | 5.2% | 4.8% |
| 70 | 6.1% | 5.8% | 5.3% |
| 75 | 7.0% | 6.5% | 5.9% |
| 80 | 8.3% | 7.6% | 6.6% |
*Annual payout rates for a $100,000 premium. Rates vary by insurance company, premium amount, and state. Data as of April 2025.
Is an Immediate Annuity Right for You?
An immediate annuity might be a good fit if you:
Are already retired or near retirement
Need guaranteed income that starts right away
Want protection against outliving your savings
Prefer simplicity and predictable payments
It might not be ideal if you:
Need access to your principal in the future
Want to leave a large inheritance
Are significantly younger than retirement age
Immediate Annuity Payout Options
Choose the income option that best fits your retirement needs
Life Only
Provides guaranteed income for as long as you live, with no minimum payment period or death benefit. Payments cease upon your death.
Best for: Those seeking maximum income who don't need to leave a legacy or have other assets for heirs.
Joint Life
Provides income for as long as either you or your spouse lives. After the first death, payments may continue at the same level or be reduced (typically to 50-100%).
Best for: Married couples who want to ensure the surviving spouse continues to receive income.
Period Certain
Provides income for a specific number of years (5, 10, 15, 20, etc.). If you die before the period ends, your beneficiary receives the remaining payments.
Best for: Those wanting guaranteed payments for a specific timeframe, regardless of lifespan.
Life with Period Certain
Combines lifetime income with a guaranteed minimum payment period. If you die during the period certain, your beneficiary receives the remaining guaranteed payments.
Best for: Those wanting lifetime income with some legacy protection for early death.
Life with Cash Refund
Provides lifetime income with a guarantee that your beneficiary will receive any remaining premium if you die before receiving back your full initial investment.
Best for: Those wanting lifetime income with a guarantee to not lose any principal.
Installment Refund
Similar to Cash Refund, but instead of a lump sum, your beneficiary continues to receive your regular payment until the total equals your original premium.
Best for: Those wanting lifetime income with beneficiary protection in the form of continued payments.
How Payout Rates Compare
The payout option you choose significantly impacts your income amount. Here's how the options generally compare in terms of payment size:
Payout Rate Comparison
Highest Payout (100%)
~94% of Life Only
~90% of Life Only
~85% of Life Only
~80% of Life Only
*Percentages are approximations and will vary by insurance company, age, premium amount, and market conditions.
Immediate Annuity Income Calculator
Estimate how much guaranteed income you could receive
Frequently Asked Questions
Get answers to common questions about immediate annuities
Ready to Secure Your Retirement Income?
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