Types of Annuities

Annuity Types

• An annuity with payment intervals that are not the same as the interest compounding period is called an uneven annuity.

Payment Timing

• In an ordinary annuity, payments are made at the end of each payment interval.

Annuity Duration

• An annuity with payments that extend over an indefinite or indeterminate length of time is called a perpetuity.

Annuity Period

• The term used to describe the time between the first payment interval and the last payment interval of an annuity is the annuity period.

Payment Terminology

• Each payment made in an annuity is called an installment.

Fixed-Term Annuity

• An annuity with payments that begin and end at specific dates is called a fixed-term annuity.

Synchronized Annuity

• An annuity where the payment intervals are the same as the interest period is called a synchronized annuity.

General Annuity Definition

• A sequence of equal payments made at a regular interval of time is defined as an annuity.