By Brett Gersack CFP®, AIF®, Senior Wealth Advisor

I’m sure you’ve heard or read online someone trying to explain or sell you on the advantages of an annuity. To be honest, these instruments can be confusing! With the diverse range of annuity options available, it can be challenging to navigate through the intricacies and understand which type might best suit your needs.

In today’s complex world, planning for a comfortable retirement has become more important than ever. Since many of us no longer have access to lifetime pensions like our parents or grandparents had, annuities have emerged as a popular choice for individuals seeking a reliable source of income in retirement. That’s what annuities are designed to provide.

Below, I’ll walk you through five different types of annuities and their unique advantages and drawbacks. Whether you’re looking for stability, growth potential, or a combination of both, understanding the nuances of each is essential in making informed decisions. Some key considerations include tax implications, potential for growth, and the ability to customize your annuity to align with your retirement goals.

5 Types of Annuities

As the world of annuities continues to change, it’s useful to stay educated on the different products that are being created.

1.  Fixed Annuities

These annuities provide a guaranteed fixed interest rate for a specific period. They offer stability and predictable income, making them suitable if you’re seeking a reliable source of income during retirement.

2.  Variable Annuities

Variable annuities allow you to invest in a range of investment options, such as stocks and bonds. The potential for higher returns comes with increased risk, as the value of your investment can fluctuate. Variable annuities are suitable for those who are comfortable with market volatility and are seeking growth potential.

3.  Indexed Annuities

These annuities offer returns based on the performance of a specific market index, such as the S&P 500. They provide the opportunity for growth while also offering downside protection. Indexed annuities are suitable for individuals looking for potential market-linked returns with some level of protection against market downturns.

4.  Immediate Annuities

Immediate annuities provide regular income payments that start immediately after they’re purchased. They are suitable for individuals who want to convert a lump sum of money into a steady income stream without any delay. Some people will look at this as creating their own pension.

5.  Deferred Annuities

Deferred annuities allow you to accumulate funds over a specific period before starting to receive income payments. They are suitable for individuals who want to save for retirement or have a future income need.

Could annuities play a useful role in your investment portfolio?

Annuities offer a range of positive features that can make them an appealing option for those who are seeking financial stability and a worry-free retirement. From guaranteed income to tax-deferred growth and customizable options, annuities can help to provide a secure path to long-term financial well-being. But factors such as fees, surrender charges, and the financial stability of the annuity provider are critical.

That’s where we come in. Your advisory team is committed to help you confidently navigate the complexities of retirement planning and make choices that align with your long-term financial objectives. Helping you expand your knowledge of the different types of annuities is key to coming to a determination on which, if any, type of annuity might align with your financial goals and risk tolerance.


Halbert Hargrove Global Advisors, LLC (“HH”) is an SEC registered investment adviser located in Long Beach, California. Registration does not imply a certain level of skill or training. Additional information about HH, including our registration status, fees, and services can be found at This blog is provided for informational purposes only and should not be construed as personalized investment advice. It should not be construed as a solicitation to offer personal securities transactions or provide personalized investment advice. The information provided does not constitute any legal, tax or accounting advice. We recommend that you seek the advice of a qualified attorney and accountant.