what is the difference between a fixed annuity and a variable annuity 
a fixed annuity pays out a fixed percentage or interest rate on the owner s contributions to the annuity a variable annuity pays out based on the performance of a basket of investments variable annuities offer the potential for higher returns or payouts when markets are performing well however they also contain more risk than fixed annuities since the account could decline in value when the markets perform poorly 