What does the phrase "guaranteed income" typically refer to in the context of annuities?

The phrase "guaranteed income" in the context of annuities primarily refers to fixed payments that continue until death. This concept is foundational to many types of annuities, particularly those that are structured as life annuities. These financial products are designed to provide a steady stream of income, usually for the lifetime of the annuitant, helping ensure financial security in retirement.

The term emphasizes the certainty and reliability of these payments, which are predetermined and not influenced by market fluctuations or changes in economic conditions. This aspect makes guaranteed income appealing for individuals seeking stability and predictability in their financial planning.

In contrast, other options such as variable payments based on market performance or payments subject to changes in interest rates do not provide the same level of certainty, as they fluctuate based on external factors that can vary widely. Income linked to stock market indexes also lacks the guarantee aspect, as it is contingent upon market performance.