Annuity: Difference between revisions
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imported>Doug Williamson m (Numbering and classification.) |
imported>Doug Williamson m (Expand to clarify a Time 1 cash flow meaning a cash flow at Time 1 period hence. Similarly the Time n cash flow being at Time n periods hence. Add line space before last sentence.) |
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#A series of equal future periodic cash flows, starting at Time 1 and ending at a predetermined future Time n. | #A series of equal future periodic cash flows, starting at Time 1 period hence and ending at a predetermined future Time n periods hence. | ||
#More generally, any series of future periodic cash flows, either equal in amount or growing at a fixed compound rate per period, starting at a future time or already in payment, and usually ending at a later future time. | #More generally, any series of future periodic cash flows, either equal in amount or growing at a fixed compound rate per period, starting at a future time or already in payment, and usually ending at a later future time. | ||
#Any financial arrangement in which a periodic income is paid to an individual, often as a pension. | #Any financial arrangement in which a periodic income is paid to an individual, often as a pension. | ||
#An insurance contract purchased from a life assurance company that pays an income in exchange for a lump sum. | #An insurance contract purchased from a life assurance company that pays an income in exchange for a lump sum. | ||
There are many variations on such annuities, depending on the nature of the income stream. | There are many variations on such annuities, depending on the nature of the income stream. | ||
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* [[Simple annuity]] | * [[Simple annuity]] | ||
[[Category: | [[Category:Manage_risks]] | ||
Revision as of 09:18, 12 July 2014
- A series of equal future periodic cash flows, starting at Time 1 period hence and ending at a predetermined future Time n periods hence.
- More generally, any series of future periodic cash flows, either equal in amount or growing at a fixed compound rate per period, starting at a future time or already in payment, and usually ending at a later future time.
- Any financial arrangement in which a periodic income is paid to an individual, often as a pension.
- An insurance contract purchased from a life assurance company that pays an income in exchange for a lump sum.
There are many variations on such annuities, depending on the nature of the income stream.
