What type of annuity is specifically designed to provide regular payments for a specified period of time?

An immediate annuity is specifically designed to provide regular payments for a specified period of time. This type of annuity is typically purchased with a lump sum payment and begins disbursing payments almost immediately—usually within a month of purchase. The payments continue for the duration of the specified time frame, which can range from a few years to the lifetime of the annuitant, depending on the terms of the contract.

The unique feature of immediate annuities is their focus on providing a predictable income stream right away, which is ideal for individuals who need immediate cash flow, such as retirees. They help in budget planning by guaranteeing a fixed income for the specified period, ensuring financial stability.

In contrast, other types of annuities serve different purposes. For example, a deferred annuity allows the investor to accumulate funds over time before beginning to receive payouts, which does not fit the immediate payment structure. Fixed index annuities provide growth potential linked to a stock market index while ensuring a minimum guaranteed return, but they do not guarantee immediate payments. Survivorship annuities are designed to provide payments to a survivor upon the death of the annuitant, which again does not correlate with the intent of immediate funds for a set period.