You buy an income annuity with a lump sum, maybe from another retirement plan or an inheritance.

• You decide who you want to receive payments, how often, and for how long.
• You may begin receiving income checks immediately.
• Your income payments may continue for a specific time period, as long as you live, even as long as both you and your spouse live--your choice.*

*Whoever gets the payments owes income taxes.

How it works - An annuity is really a contract with a life insurance company. But don't freak out. Sounds technical, but the idea's pretty simple. You pay the life insurance company for the annuity. In return, they agree to pay it back, plus any interest or earnings you make within the annuity. They even guarantee your payments will continue for as long as you've chosen.