It depends on which type of annuity you have. If you choose a fixed-rate annuity, you are not responsible for choosing the investments - the insurance company handles that job and agrees to pay you a pre-determined fixed return.
When you opt for a variable annuity, you decide how to invest your money in the sub-accounts (essentially mutual funds) offered within the annuity. The value of your account depends on the performance of the funds you choose. While a variable annuity has the benefit of tax-deferred growth, its annual expenses are likely to be much higher than the expenses on regular mutual funds - so ordinary funds may be a better option.
