annuity

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annuity:

see insuranceinsurance
or assurance,
device for indemnifying or guaranteeing an individual against loss. Reimbursement is made from a fund to which many individuals exposed to the same risk have contributed certain specified amounts, called premiums.
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References in periodicals archive ?
For the average family headed by a person 62 or older, two-thirds of total income consists of some form of annuitized income-Social Security, public or private employee pensions, or annuities.
Tim Barton, principal of Future Financial Images, Pepin, Wis., agrees, adding that the FIA's ability to offer clients a choice between principal and indexed earnings is especially relevant in light of a key market statistic: 98 percent of annuities are never annuitized. The alternative offered by variable annuities, forgoing access to principal to secure the income benefit is tantamount, says Barton, to a "legal divorce" from one's money."
In today's low interest rates $1 million (annuitized) would generate close to $80,000 guaranteed income as long as he's (the client is) alive.
The annuity payment rate of the trust was 2.4% and 25% of the value of the assets transferred to the trust was annuitized. (11)
Assets held in PRAs or financial assets held outside of retirement accounts are typically not annuitized and are instead spent or saved at the owners' discretion.
Taking Their "Lumps": The reported percentage of DB plan participants taking lump-sum distributions declined from 51.8% as of 6/30/2009 to 49.7% as of 6/30/2010, which could be an indication that more participants are realizing the advantages of annuitized payments.
"We have even developed an investment structure where these investors can actually get physical, annuitized cash returns from these participations."
Lawmakers crafted the statutes to protect consumers from businesses that entice prize winners to take an immediate - but usually much smaller - lump sum in trade for annuitized payments.
When an annuity is annuitized, the owner losses all control over the underlying funds, has no right to make investment decisions, and gives up any rights to accelerated payments.
(The annuity contract owner has essentially the same ownership rights as the owner of a life insurance contract.) Under the annuity contract, the owner names the individual who will serve as the annuitant, names the individual or entity who will be the beneficiary under the contract, determines when the contract will be annuitized, and has the power to make partial withdrawals from the contract or fully surrender the contract for its cash value.
If the same fund had been annuitized, then the probability of outliving the assets would have been eliminated, and the monthly income would not have needed to be reduced.