Inflation-Protected Annuity - IPA


DEFINITION of 'Inflation-Protected Annuity - IPA'

An annuity investment that guarantees a real rate of return at or above inflation. The real rate of return is the nominal return, less the inflation rate, thus protecting annuitants and beneficiary investors from inflation.

BREAKING DOWN 'Inflation-Protected Annuity - IPA'

Inflation-protected annuities are becoming more popular with annuity investors who are worried about the risk of inflation decreasing the purchasing power of their money as they age.

  1. Inflation

    The rate at which the general level of prices for goods and services ...
  2. Annuity

    A financial product that pays out a fixed stream of payments ...
  3. Consumer Price Index - CPI

    A measure that examines the weighted average of prices of a basket ...
  4. Inflationary Risk

    The uncertainty over the future real value (after inflation) ...
  5. Real Rate Of Return

    The annual percentage return realized on an investment, which ...
  6. Inflation-Protected Security - ...

    A type of fixed-income investment that guarantees a real rate ...
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