Annuitant - Financial definition

In the context of financial planning and retirement, an annuitant is typically someone who has invested in an annuity contract, often as part of their retirement strategy. The annuity can be structured in various ways, such as immediate or deferred, and can provide payments that are fixed, variable, or indexed.

For example, a retiree might purchase an immediate annuity with a lump sum payment to receive a steady income stream starting immediately. Alternatively, a deferred annuity might accumulate interest over time, with payments beginning at a future date, such as retirement. Market practices for annuities often include options for joint annuitants, where payments continue to a surviving spouse after the primary annuitant's death, and guaranteed periods, which ensure payments for a minimum number of years even if the annuitant passes away early. The role of the annuitant is central to the annuity contract, as their life expectancy and financial needs directly influence the structure and payout of the annuity.