Retirement is a welcome change for those who have worked hard throughout their youth. But it can also be somewhat unsettling because one is suddenly left without a stable source of income. Fortunately, planning early for retirement can help one transition seamlessly into retirement. Opting for an annuity is a retirement strategy that can help with financial stability in one’s retirement years. But one should be careful to avoid certain annuity mistakes. Unclear about the different annuity types Several types of annuity plans are available today, each with distinct pros and cons. Depending on one’s retirement goals, pension prospects, other income sources, etc., one should carefully consider which retirement plan would be the best. For example, fixed annuities offer a specific interest rate over a fixed period, so one can be assured of a fixed income, regardless of economic conditions, inflation, and other factors. However, since this amount is fixed, it might not be commensurate with one’s needs if they increase over time. On the other hand, with variable annuities, the corpus is invested in different securities, so if the portfolio assets perform well, one has a chance to earn high yields after retirement. Conversely, the downside is that if the portfolio underperforms, one might suffer losses.