An immediate annuity converts a lump sum into a stream of income payments that begin almost right away — useful when you need a paycheck now.
This guide explains how immediate annuities work, their payout options, and the trade-offs to weigh.
How immediate annuities work
Exchanging a lump sum for guaranteed payments that start within about a year.
Payout options
Life-only, period-certain, and joint payouts, and how each affects your income.
The income-for-liquidity trade-off
Why higher guaranteed income usually means giving up access to the lump sum.
When an immediate annuity fits
Situations where converting savings to income now makes sense.
This guide is for general educational purposes only and is not financial, tax, or legal advice. Tim Hartle is an independent insurance professional. Annuity guarantees are subject to the claims-paying ability of the issuing insurance company and are not FDIC insured. Rules and product features vary by situation and by state. Please consult a qualified advisor about your own circumstances.