A right to receive amounts of money regularly over a certain fixed period, in perpetuity, or, especially, over the remaining life or lives of one or more beneficiaries.
"After retiring early, John purchased an annuity that guarantees his wife will receive monthly payments for the rest of her life."
In plain English: An annuity is an investment that pays you regular amounts of money, usually every month for life.
"He started receiving his monthly annuity payments from the insurance company last week."
Usage: An annuity is an insurance product that provides regular payments for a set time or until death. It differs from savings accounts because funds are typically locked away and begin paying out only after contributions stop.
The word annuity comes from the French term annuité, which derives from the Latin annuus meaning "annual." It originally referred to something that occurs or is paid every year.