Whole Life Annuity

DEFINITION of 'Whole Life Annuity'

A financial product sold by insurance companies that pays monthly, quarterly, semiannual or annual payments to a person for as long as he or she lives. Annuities are usually purchased by investors who want to secure some type of income stream during retirement. The accumulation period occurs as payments are being made by the buyer of the contract to the insurance company; the liquidation period occurs when the insurance company makes payments to the annuitant.


Also called life annuity.

BREAKING DOWN 'Whole Life Annuity'

Annuities can be structured to make payments for a fixed amount of time, commonly 20 years, or make payments for as long as the annuitant and his or her spouse is alive. Actuaries work with the insurance companies to apply mathematical and statistical models to assess risk when determining policies and rates.

RELATED TERMS
  1. Whole Life Annuity Due

    A financial product sold by insurance companies that requires ...
  2. Annuity Consideration

    The money that an individual pays to an insurance company in ...
  3. Annuity

    A financial product that pays out a fixed stream of payments ...
  4. Years Certain Annuity

    An insurance product that pays the holder a monthly income for ...
  5. Mortality And Expense Risk Charge

    A variable annuity fee included in certain annuity or insurance ...
  6. Life Annuity

    An insurance product that features a predetermined periodic payout ...
Related Articles
  1. ETFs & Mutual Funds

    Annuities

    What annuities are: Insurance products that provide a source of monthly, quarterly, annual or lump sum income during retirement. Pros: Tax-deferred growth of earnings; no annual contribution ...
  2. Markets

    Explaining Types Of Fixed Annuities

    Learn about this popular retirement tool, its pros and cons and how annuities work to create a guaranteed regular stream of retirement income.
  3. Financial Advisor

    Advising FAs: Explaining Annuities to a Client

    Conceptually speaking, annuities can be thought of as a reverse form of life insurance.
  4. Retirement

    How a Fixed Annuity Works After Retirement

    These popular investments can provide a steady stream of income during your retirement years. Here are the details.
  5. Personal Finance

    An Overview Of Annuities

    These contracts provide a guaranteed income stream. Learn how they work and their benefits.
  6. Retirement

    Buying Annuities in a Low Interest Rate World

    Learn if buying an annuity makes sense in a low interest rate environment. Also discover the different types of annuities and how interest rates affect them.
  7. Retirement

    Are Annuities Retirement-Only Investments?

    Learn more about why annuities are generally purchased and the way that they can positively and negatively affect an individual preparing for retirement.
  8. Retirement

    When Annuities Are the Wrong Investment

    Understand how annuities provide several unique benefits, but many drawbacks as well, and identify the situations where they are not the best investment.
  9. Financial Advisor

    Annuities and Baby Boomers: The Pros and Cons

    The pros and cons of annuities that Baby Boomers seeking retirement income need to know.
  10. Retirement

    Retirement Tips: Choose the Best Annuity Provider

    It pays to get the best advice if you are thinking of putting your money into one of these complicated investments.
RELATED FAQS
  1. What are the main kinds of annuities?

    Learn about the four basic types of annuities, and why the different investment and payout options are suitable for different ... Read Answer >>
  2. What is the difference between an individual retirement account and an individual ...

    All these years I thought I had a "regular" IRA (I made $22,000 pre-tax deposits spring of 1985 and 1986), ... Read Answer >>
  3. For what types of financial instruments would I want to calculate the present value ...

    Learn about the types of financial instruments the present value of an annuity calculation is most useful for, including ... Read Answer >>
  4. What is an annuity?

    An annuity is a contract between you and an insurance company in which you make a lump sum payment or series of payments ... Read Answer >>
  5. What is the difference between a fixed and variable annuity?

    Understand the difference between fixed, variable and indexed annuities, and read a brief summary of their respective risks ... Read Answer >>
  6. What happens to my annuity after I die?

    Understand the different types of annuity payment plans and what payments or additional benefits are payable to your beneficiaries ... Read Answer >>
Hot Definitions
  1. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  2. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  3. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  4. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  5. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
  6. Underweight

    1. A situation where a portfolio does not hold a sufficient amount of a particular security when compared to the security's ...
Trading Center