In an annuity, the benefit that an investor gets is that if he receives an amount that is more than the original payout, then it is considered a gain. Annuities can be used as a tax shelter by the wealthy and as a source of guaranteed income by the risk-averse. There are two main types of annuities; the first type is the tax-deferred annuity and the second is the income annuity. The deferred annuity occurs after a certain period of time in which the final premium is paid. The income annuity is purchased at a specific amount by people who are nearing retirement. The purpose of choosing the annuity is to provide significant knowledge regarding the final decision that would be made by the investor. Since it is a long-term investment, this method will give an idea whether to invest it or not. The final decision can be seen from the result of net present value and discounted cash flow. After these calculations, the investor will be able to make decisions. Examples include mortgage payments, pension payments, insurance payments, etc. It can be done monthly, quarterly, half-yearly and annually. Two types of revenue must be calculated for the final decision; the first is the ordinary annuity and the second is the annuity due but not paid. (Scott,