Annuities have been with us for decades, and have usually been favored by the wealthy. Lately, they're becoming increasingly attractive to IRA and CD owners, due to their higher-than-average interest rates, tax benefits and flexibility.

An annuity is a contract in which an insurance company makes a series of payments, with a fixed or variable interest rate, in return for a premium or premiums you have made. Most often purchased for future retirement income, annuities are the only vehicles that can provide a guaranteed income stream for as long as you live.

Interest rates on annuities can be well above cds, and gains grow tax-deferred. This feature alone can help you to beat inflation rates, and maximize cash accumulation.