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Want regular income after retirement? How annuity plans work and what you should know about them
Mint 1 hr ago·11 Sept 2026, 3:35 am
An annuity plan is a financial product designed to provide a steady stream of income, often after retirement. You invest a lump sum or make regular payments to an insurance company, which then pays you back over a set period or for the rest of your life. This structure helps retirees manage expenses by converting a one-time savings amount into a predictable monthly cash flow.
For investors, annuities offer a way to manage longevity risk, ensuring funds last as long as they do. They can serve as a stable foundation for a retirement budget, though they typically come with lower returns compared to other investment options. It is important to carefully review the terms, including payout frequency and duration, before committing funds.
What to watch next: Compare the payout rates and fees of different plans to ensure they align with your financial goals. Consider how the annuity fits into your broader retirement strategy, including other income sources like the Employees' Provident Fund (EPF) or pension schemes.
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