Annuities

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The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Annuities

 

a form of state loan by which the creditor periodically receives a certain income (rente), established on the basis of a gradual liquidation of the capital sum and interest on the debt. There are fixed-term and life annuities. In the case of the former, the payment of income is limited in time (usually the period is quite long) and may be transferred to another individual. In the case of lifetime annuities, income may be received only by the immediate creditor, and the payment of rente ceases with the death of the holder. The price of annuities derives from the market level of loan interest rates. The size of the annual payment on lifetime annuities is determined in accordance with the age of the creditor and statistical data on the mortality of the population. In Britain and France annuities were issued in the early 19th century in order to speed up the liquidation of termless loans, the latter being exchanged for fixed-term or lifetime loans. In non-European countries annuities spread in the 17th and 18th centuries: in the USA they were issued during the consolidation of the state debt, which arose during the War for Independence (1775–83).

The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
References in periodicals archive ?
Even after retirement at 60, one can withdraw only up to 60 per cent the corpus; the rest has be annuitised While the lock- in ensures the subscriber does not use the funds during his working life, annuity makes sure the money is paid in instalments over a long period.
Even after retirement at 60, one can withdraw only up to 60 per cent of the corpus; the rest has to be annuitised.
The policy's impact on annuity rates means that someone with a pounds 26,000 pension pot retiring today would receive 22% less income than if they had annuitised four years ago, making them pounds 440 a year worse off.