What Is Annual Turnover? Annual turnover is the percentage rate at which something changes ownership over the course of a year. For a business, this rate could be related to its yearly turnover in inventories, receivables, payables, or assets. In investments, a mutual fund or exchange-traded fund (ETF) turnover rate replaces its investment holdings on
What Is Annuitization? Annuitization is the process of converting an annuity investment into a series of periodic income payments. Annuities may be annuitized for a specific period or for the life of the annuitant. Annuity payments may only be made to the annuitant or to the annuitant and a surviving spouse in a joint life
What Is an Annuitization Method? The term annuitization method refers to an annuity distribution structure. Annuities are financial contracts distributed by financial institutions that allow individuals to invest money over a period of time to give them a source of income in the future—normally during retirement. Annuity contracts outline the method of payment. These options
Investopedia / Ryan Oakley What Is an Annuity? The term “annuity” refers to an insurance contract issued and distributed by financial institutions with the intention of paying out invested funds in a fixed income stream in the future. Investors invest in or purchase annuities with monthly premiums or lump-sum payments. The holding institution issues a
What Is an Annuity Certain? An annuity certain is an investment that provides a series of payments for a set period to a person or the person’s beneficiary or estate. It is an investment in retirement income offered by insurance companies. The annuity may also be taken as a lump sum. Because it has a
What Is Annuity Consideration? An annuity consideration or premium is the money an individual pays to an insurance company to fund an annuity or receive a stream of annuity payments. An annuity consideration may be made as a lump sum or as a series of payments, often referred to as contributions. Key Takeaways An annuity
What Is an Annuity Contract? An annuity contract is a written agreement between an insurance company and a customer outlining each party’s obligations in an annuity agreement. Such a document will include the specific details of the contract, such as the structure of the annuity (variable or fixed); any penalties for early withdrawal; spousal and
What Is the Annuity Factor Method? The annuity factor method is a way to determine how much money can be withdrawn early from retirement accounts before incurring penalties. The calculation primarily uses life-expectancy data and is applied to annuities and individual retirement accounts (IRAs). It is similar to the fixed amortization method, though it utilizes
What Is Annuity in Advance? Annuity in advance is a series of payments that are due at the beginning of each successive time period. Rent is the classic example of an annuity in advance for a landlord because it is a sum of money paid at the beginning of each month to cover the period
What Is an Annuity Table? An annuity table is a tool for determining the present value of an annuity or other structured series of payments. Such a tool, used by accountants, actuaries, and other insurance personnel, takes into account how much money has been placed into an annuity and how long it has been there
