human
I'm a little confused about what the difference between an annuity and a mutual fund is.
assistant
An annuity is a contract in which you pay a lump sum of money to an insurance company, and they agree to pay you a fixed amount each month for a certain number of years (usually 10 or 15). The insurance company will also make periodic payments if you die before the end of the period. Mutual funds are similar to stocks and bonds; instead of owning shares directly, you own shares in a pool of investments managed by a professional fund manager.