Which financial product is primarily used to provide retirement income?

• A. Savings plan
• B. Mutual fund
• C. Annuity
• D. Insurance policy

Answer: (C)

The key idea is turning a lump sum into a steady income stream. An annuity is designed to do exactly that: once you fund it, it can pay out regular income for a set period or for life, providing predictable retirement cash flow. That makes it the best fit for retirement income among the options.

A savings plan focuses on accumulating money, not guaranteeing ongoing payments. A mutual fund is an investment that aims for growth and income, but withdrawals depend on market performance and aren’t guaranteed. An insurance policy mainly provides protection against risk (and some policies can build cash value), but it isn’t primarily used to guarantee a steady retirement paycheck.