A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- AnnuityA contract with an insurance company that converts a sum of money into a stream of steady payments over time.
- Deferred AnnuityAn annuity that grows for years before payments begin, letting your money build up before you start drawing income.
- PensionA retirement plan where your employer promises a set monthly payment for life, usually based on your salary and years worked.
- Lump-Sum DistributionTaking your entire retirement benefit as one large payment instead of receiving it as monthly income over time.
- Safe Withdrawal RateThe percentage of your savings you can spend each year with low risk of running out of money during retirement.
- Longevity RiskThe chance that you outlive your retirement savings because you live longer than your money was planned to last.
More in Retirement
Plain-English education — not personalized legal, tax, or investment advice.