A mutual fund is a fund in which money flows from investors and invaded stocks, equities, and bonds. The fund managers oversee the mutual funds and diversify their investment based on performance. Life insurance institutions issue an annuity. An annuity is built up of many mutual funds that work together.
The investor usually gets a secured premium along with the earned interest for their assets. Annuity gains are free from taxes pending the assets withdrawn. On the other hand, the increases in mutual funds are annually taxed. With an annuity, one is guaranteed a percentage of growth per year. On the other hand, there is no assurance on the increase each year for mutual funds.
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