An annuity is money that comes from an investment and is paid out regularly over a fixed period of time. You can buy an insurance policy that is an annuity, or you can choose an annuity as one of your retirement fund options.

The noun annuity is from the Latin word annus, meaning "year." Indeed, annuities typically pay out on a year basis, although other terms are possible. If you win a large amount of money in the lottery, you can usually choose to take a lump-sum payment or smaller payments paid every year over some term, like 20 or 25 years. Figuring out which payment plan is best for you would be a nice problem to have!

Definitions of annuity
  1. noun
    income from capital investment paid in a series of regular payments
    “his retirement fund was set up to be paid as an annuity
    synonyms: rente
    see moresee less
    show 5 types...
    hide 5 types...
    annuity in advance
    an annuity paid in a series of more or less equal payments at the beginning of equally spaced periods
    ordinary annuity
    an annuity paid in a series of more or less equal payments at the end of equally spaced periods
    reversionary annuity, survivorship annuity
    an annuity payable to one person in the event that someone else is unable to receive it
    an annuity scheme wherein participants share certain benefits and on the death of any participant his benefits are redistributed among the remaining participants; can run for a fixed period of time or until the death of all but one participant
    a payment or series of payments made by the lessee to an owner for use of some property, facility, equipment, or service
    type of:
    regular payment
    a payment made at regular times
Word Family

Test prep from the experts

Boost your test score with programs developed by’s experts.

  • Proven methods: Learn faster, remember longer with our scientific approach.
  • Personalized plan: We customize your experience to maximize your learning.
  • Strategic studying: Focus on the words that are most crucial for success.


  • Number of words: 500+
  • Duration: 8 weeks or less
  • Time: 1 hour / week


  • Number of words: 500+
  • Duration: 10 weeks or less
  • Time: 1 hour / week


  • Number of words: 700+
  • Duration: 10 weeks
  • Time: 1 hour / week