Specifically Fixed Index Annuities
Annuities could be called savings accounts that pay you at some time in the future. Basically there are two types of annuities: immediate and deferred. They are generally but not always presented as retirement vehicles.
An immediate annuity requires you to deposit a single premium (modest example 100000) with an insurance company, which will commence paying you, say within a month to a year, depending on the frequency selected. The money will be paid to you for your lifetime, or for any period selected by you and allowed by the carrier.
A deferred annuity will require a single premium or may offer multiple premiums, and will begin payments at a time in the future chosen by you. A fixed index annuity is a type of deferred annuity.
Whereas cash savings accounts have traditionally been held in banks and their counterparts, annuities are held and distributed by life insurance carriers offering guaranteed safety of principal and income. They are guaranteed by the life insurance carrier, not the federal government.
More coming on fixed index annuities as retirement alternatives. Fixed index annuities offer indexed growth and must adhere to the provisions of state insurance law in the state purchased.