annuity - Master This Word
Master this word with our 5-step learning method – Learn English in English
annuity Word Meanings
- a fixed sum of money paid to someone each year, typically for the rest of their life
- a type of investment that pays out a regular income
- a financial product that provides payments on a scheduled basis over time
annuity Example Sentences
Example sentences are the start of understanding. Don't rush to memorize. First feel how the word works in a sentence.
annuity Phonetic & Pronunciation
UK
/əˈnjuːɪti/
US
/əˈnuːɪti/
annuity Word Etymology
The word 'annuity' comes from the Latin 'annuitas', consisting of 'annus' (year) and the suffix '-itas' (quality of). It evolved through Old French before entering Middle English. Picture a tree that grows each year, bearing fruit continually - just like an annuity provides regular returns over time.
Note 1: These definitions and etymologies are not standard dictionary definitions, but extended explanations provided to help with memorization and understanding of the actual application of words. Through this background information, we strive to make words more vivid and easier to understand, and help you remember their meanings in real life.
Note 2: LexiTalk designs the learning flow around the linguistics principle of “Comprehensible Input.” When learners encounter material that is slightly above their level but still understandable from context, the brain naturally absorbs the language. That’s why we keep every word inside authentic contexts, using examples and associations to help you understand it and use it flexibly.
Read the FAQ explanation of Comprehensible InputReal Context
An annuity is a contract or financial product that pays a fixed amount of money to the holder at regular intervals, typically yearly, for a specified period or for life. It is commonly used to generate retirement income and provide budget stability after you stop working. An immediate annuity starts payments soon after purchase, while a deferred annuity accumulates value before payments begin. Annuities can be fixed, guaranteeing payments, or variable, changing with the performance of underlying investments. They are issued by insurers and may include fees, surrender charges, and tax considerations. Knowing terms like payout, duration, and beneficiary rights helps you compare options and avoid surprises.
Usage Reminders
- payout, fixed vs variable, immediate vs deferred, surrender charges, tax implications
Common Misconceptions
- Annuity is the same as a pension or Social Security
- You will always get your money back if you surrender early
- All annuities are risk-free
- Annuities can be cashed out like a savings account
- Tax treatment is the same everywhere
Thinking Differences
Annuitites are a long-term income product; English learners should note the distinction between immediate and deferred versions and between fixed and variable payouts.
Learning Tips
- Learn the common phrases: immediate annuity, deferred annuity, fixed annuity, variable annuity
- Compare payout rates and fees across providers
- Look up real-life scenarios like retirement planning
- Practice with a calculator to estimate payments
- Listen for synonyms like pension, pension income, retirement income
- Create flashcards for terms like surrender charge, beneficiary
5-Step Learning Method - Learn English in English
Step 1: Meaning
What is the definition of the word 'annuity'?
A.A casual meeting among friends.
B.A type of investment that guarantees high returns.
C.A financial product offering a series of payments made at equal intervals.
D.A technique for baking pastries.
Step 2: Usage
Which sentence uses 'annuity' correctly?
A.He wrote an essay about an annuity in history class.
B.The annuity was very tasty and filled with cream.
C.She decided to get an annuity to secure her retirement income.
D.The dog barked loudly at the passing annuity.
Step 3: Similar Words
Which word is most similar to 'annuity'?
A.savings
B.pension
C.investment
D.liability
Step 4: Opposite Words
What is the opposite of 'annuity'?
A.lump sum
B.variable income
C.unexpected gain
D.one-time payment
Step 5: Mastery
Can you think of a real-life context where financial planning is crucial?
A.Investing in stocks to gain high returns immediately.
B.Receiving payments from an insurance policy over a fixed term.
C.Opening a savings account with a minimal balance.
D.Spending all your savings on a luxury vacation.
Want to practice more words?
Download LexiTalk app for personalized learning experience
Download App