Many people worry if they will have enough money during their retirement years. Annuities were developed to help alleviate these stresses. An annuity is essentially a contract with an insurer, where individuals agree to pay the company a certain amount of money, either in a lump sum or through installments, which entitles them to receive a series of payments at a future date. These payments often last for a specific time span. Other annuities offer lifetime distribution. Depending on the case the policyholders chooses, policyholders know they'll be financial set for the future.