Our book is a unique merging of financial literacy with life literacy.  Here’s an example of that Yin-Yang merging, Annuity/Emotional Annuity. It reminds us that, like an ANNUITY, our emotional commitment towards others can be …forever.


An annuity is a series of periodic payments. An ordinary annuity begins one period from “now,” each payment is the same amount, with an ending date for the payments. An “annuity due” begins today, rather than one period from today. With a “perpetuity,” there is no last payment; they are supposed to go on forever. With a growing annuity, the payments increase in dollar amount over time at a steady rate.

You will deal with annuities throughout your life. Your monthly mortgage payment, auto leases and auto loan payments are annuities (often with an extra initial down payment) you pay to a lender. The dividends you receive on stocks are often modeled to be annuities. Preferred stocks are another security that some companies issue to raise capital. They promise to pay a fixed dividend forever, a “perpetuity,” unless something unexpected happens, like a corporate bankruptcy.

Social security payments represent a growing annuity if there is inflation, and an ordinary annuity if there is none. If you retire with a pension, it will be an annuity. Finally, life insurance companies offer many types of annuities.


Create your own annuity. Get in the habit of saving every month. Better still, save just a bit more each month than the prior month (a growing annuity). Also, carefully research the insurance companies that sell annuities. Find the rating of the insurance company at ratings agencies such as Moody’s, A.M. Best, Fitch, and Standard & Poor’s. Realize that insurance salespeople make their living from commissions you are (perhaps unknowingly) paying them, which reduces the annuity you will ultimately receive. Beware the agency problem!



— Marine Corps motto

If you ever talk to a Marine, whether on active duty or not, you will hear words like pride, loyalty, passion, duty, and commitment. You may even hear the Marine Corps motto in a shortened form: Semper Fi.

Even if that Marine has misgivings about the specific mission they were on, or the country they were in, you will not hear doubts or misgivings about the Corps or their comrades in arm. You are listening to someone describing an emotional annuity, and they are likely to have those feelings for as long as they live.

You can also witness an emotional annuity. The next time you see an elderly couple walking down the street with smiles on their faces, holding hands and sharing a loving glance, you are witnessing an emotional annuity payment.

A financial annuity is a predictable and often guaranteed payment stream, either for a fixed period or in perpetuity. An emotional annuity is a predictable and yes, guaranteed human bond of caring, commitment and concern. It describes the most loving families and friends. It says, “I’m here. You can count on me.”

When parents describe the unconditional love for their children, they are describing an emotional annuity. During the wedding ceremony, when couples promise to love and honor, in sickness and in health, they are committing to an emotional annuity. When adult children take care of aging parents, those children are making an emotional annuity payment.

Semper fidelis is the essence of an emotional annuity. If you have ever experienced it, you are indeed blessed. If you want to experience it, start making the emotional investment today, because time passes quickly. In the words of Lena Horne, “It’s so nice to get flowers while you can still smell the fragrance.”

HSF Publishing

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