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Definition:


Annuity




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An annuity is a regular periodic payment made by an insurance company to a policyholder for a specified period of time. More generally, an annuity can refer to a stream of equal payments to an individual that occur at predetermined intervals. The payments may continue for a fixed period or for a contingent period, such as for the recipient's lifetime. Annuities are usually associated with insurance companies and retirement programs, but the payment of interest to a bondholder would also be considered an annuity.


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