Deferred Annuity

An annuity with a payout phase that commences (is “deferred”) at some specified future date. Deferred annuities can be purchased with either single (lump sum) or periodic premium payments. The contract holder determines the deferral period. Deferred annuity payments can be either fixed or variable. With a deferred annuity: 1) the money can go in as a single premium payment or a series of payments; 2) the money can be invested at a guaranteed rate or variable rate, and;
3) payments are deferred to some future date.