Annuity Sales

The stock market crash in 2008 made many investors nervous. As a result, many of these investors have searched for more certain investments, including annuities. We describe annuities as an equal payment at some specified interval for a fixed period. In an investing prospective, annuities are an investment vehicle that can have a fixed rate. Although there is more involved in an annuity, the basics of an annuity are that an investor deposits money into the account and either immediately or at some point in the future receives payments. The payments are calculated like the annuity payments in the textbook. So, the payments are based off the amount deposited, the interest rate, and the number of payments. Since annuities are currently paying below 3 percent, it is surprising that sales of annuities have increased because this lower interest rate results in lower payments than when the interest rate is higher.