Annuities are appropriate for people with long-term investment horizons, who are saving for retirement and who have maxed out on their 401(k) or other qualified plan contributions and seek additional tax-deferred growth. They are also appropriate for people who want a guaranteed stream of income when they retire. A lot of qualified plans don't offer their participants this option - so if you want income you can't outlive, an annuity is an excellent choice.

Also, because they provide insurance guarantees that can protect valuable retirement assets from market downturns, such as the death benefit and optional living benefits, variable annuities can be a good choice for risk-adverse investors who wish to stay invested in the equity market where the highest returns historically have been.