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Business Definition for: annuitize
Dictionary of Finance and Investment Terms
annuitize

to begin a series of payments from the capital that has built up in an annuity . The payments may be a fixed amount, or for a fixed period of time, or for the lifetimes of one or two annuitants, thus guaranteeing income payments that cannot be outlived.

See also variable annuity , immediate payment annuity , fixed annuity , deferred payment annuity
Dictionary of Business Terms
annuitize

begin a series of payments from the capital that has built up in an annuity . The payments may be a fixed amount, or for a fixed period of time, or for the lifetimes of one or two annuitants , thus guaranteeing income payments that cannot be outlived.

Related Terms:
variable annuity

one whose periodic payments are dependent on some undetermined or uncertain outcome such as the value of a securities portfolio. Acontract between an investor and insurance company may take this form and subsequently the periodic payments would change as a function of the changes in applicable securities prices or rates of return. A variable annuity may also consist of payments that vary depending on changes in money market interest rates.

immediate payment annuity

annuity contract bought with a single payment and with a specified payout plan that starts right away. Payments may be for a specified period or for the life of the annuitant and are usually on a monthly basis.

fixed annuity

investment contract sold by an insurance company that guarantees fixed payments, either for life or for a specified period, to an annuitant. In fixed annuities, the insurer takes both the investment and the mortality risks. Afixed annuity contrasts with a variable annuity where payments depend on an uncertain outcome, such as prices in the securities markets.

deferred payment annuity

annuity whose contract provides that payments to the annuitant be postponed until a number of periods have elapsed-for example, when the annuitant attains a certain age. Also called a deferred annuity.

Referring Terms:
immediate payment annuity
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 Copyright © 2007, 2000, 1997, 1987, by Barron's Educational Series, Inc. Reprinted by arrangement with Publisher.
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