An annuity is a financial product that provides a stream of payments to an individual, typically used as an income stream during retirement. There are several benefits to purchasing an annuity, including a guaranteed income stream, tax-deferred growth, potential for higher returns, longevity protection and estate planning. Annuities provide a guaranteed stream of income, which can help retirees feel more secure in their financial future. The account grows on a tax-deferred basis, meaning that any interest earned on the account is not subject to taxes until the funds are withdrawn. Depending on the type of annuity and the options selected, annuities may offer the potential for higher returns than traditional savings options such as a savings account or certificate of deposit. An annuity can provide a guaranteed income for life, which can be especially beneficial for individuals who are concerned about outliving their savings. Some annuities have a death benefit that allows the remaining value of the annuity to be passed on to beneficiaries, which can be useful for estate planning purposes. However, it's important to note that annuities are long-term investment and have fees and charges that can affect the value of the annuity and the amount of income received. It's crucial to read and understand the terms of the annuity contract before making a decison.