If an individual wants an annuity that begins payments in the future after their contributions, what type should they select?

The correct choice is to select a deferred annuity when an individual wants an annuity that begins payments in the future after their contributions. A deferred annuity allows the investor to make contributions or deposits, and the accumulation of funds grows tax-deferred until the individual is ready to receive the income payments at a later date. This product is particularly beneficial for people planning for retirement, as it provides the opportunity to grow their savings over time before they start drawing on those funds.

Immediate annuities, in contrast, begin payments almost right away after a lump-sum investment. Single premium annuities refer specifically to an annuity funded by a single lump-sum payment, and while they can be immediate or deferred, the key feature is not the timing of payments. Joint annuities are designed to provide payments to two individuals, which also does not specifically address the need for payments to start in the future. Therefore, the focus on future payments makes the deferred annuity the clear choice for this scenario.