REAL TIME QUOTES
Multi-Year Guaranteed Annuities (MYGA)
Also known as fixed-rate or CD-type annuities, Multi-Year Guarantee Annuities (MYGA) provide a predetermined and contractually guaranteed interest rate for a set period of time, typically 2-10 years.
MYGA Rates & Quotes
Figures come from rates, updated regularly. They're estimates, not offers.
This number determines the size of your annuity. Enter a custom above or choose a preset below.
What This Number Is
The rate you'll see is contractual. The carrier fixes it for the whole term, so the balance at the end is known the day you sign. There is no market to watch and nothing to rebalance.
It works the way a bank CD works, with two differences that matter. The interest compounds tax-deferred until you take it out, and the guarantee is backed by the carrier rather than by the FDIC. That second one is why the strength rating sits beside every rate on the table.
- Longer terms usually pay more, so the real question is how long you can leave it alone.
- Most products let you take a set amount out each year, and the ones that lock it away until the term ends pay more for doing it.
- Your state matters, because not every product is approved everywhere.
What you are buying
A Known Number, on a Known Date
A multi-year guaranteed annuity is a simple bargain. You hand over a sum, the carrier fixes a rate, and on a date you already know, the balance is a number you could have written down the day you signed.
That is the whole appeal. It gets on with the job in the background while you spend your attention somewhere it is needed. People use them for the part of the money that has a job and a deadline: a bridge to Social Security, a tax bill in four years, the piece that simply must not be smaller later.
The trade is time. The carrier can pay more than a bank because it knows how long it has the money. Ask for it back early and there is a surrender charge, which is the price of the rate rather than a penalty for changing your mind.
The obvious comparison
A MYGA and a Bank CD, Side by Side
They behave alike. Where they differ is tax, term and who stands behind the guarantee.
| What is being compared | Bank CD | MYGA |
|---|---|---|
| The rate | Bank CDFixed for the term, usually one to five years. | MYGAFixed for the term, usually two to ten years, and typically higher. |
| Tax on the interest | Bank CDTaxed every year, whether or not you take it. | MYGATax deferred. Nothing is owed until you take money out. |
| Who guarantees it | Bank CDFDIC, up to the insured limit. | MYGAThe insurance company, backed by its own reserves and state guaranty associations. |
| Getting at it early | Bank CDAn interest penalty, usually a few months' worth. | MYGAA surrender charge that falls each year. Most contracts let you take some out annually without one. |
| Annual fees | Bank CDNone. | MYGANone. |
A general comparison. Bank deposits are FDIC insured; annuities are not, and rely instead on the financial strength of the insurer. Terms vary by contract.
What sits behind the rate
Four Things That Separate Two Identical Rates
Two products at the same rate can be very different contracts. This is usually where the difference is.
How much you can take out
Most contracts let you take ten percent a year with no charge on it, and some pay out the interest as it is earned. The ones that hold the money until the term ends pay a higher rate for doing it, which is a fair trade when the money was staying put anyway. Every row of the table says which kind it is, under Can take out.
Simple or compound
Compound interest earns on itself, so the balance climbs faster every year it runs. Simple interest earns only on what you handed over, and across a seven-year term the two can finish tens of thousands of dollars apart at the very same headline rate. The figures here compound annually, which makes them a fair yardstick for any quote you are shown elsewhere.
What happens at the end
A term ending is a decision, not an event. You can take the money, move it to another carrier, or let it roll into a new term, and the contract gives you a window to choose in. Put that date in the calendar the day you sign and the choice stays yours.
The market value adjustment
Many contracts adjust what you get back if you cash out early and rates have moved since you signed. When rates have fallen, that adjustment hands you more than the plain surrender value would. It runs separately from the surrender charge, and knowing which way it points is worth a question before you ever need it.
Questions People Ask About MYGAs
Is a MYGA safe?
The rate is contractual, so the balance at the end is not in question. What stands behind it is the insurance company rather than the FDIC, which is why the strength rating sits on every row of the table and why the calculator lets you set a floor for it.
Every state also runs a guaranty association that covers annuity contracts up to a limit if a carrier fails. The limits differ by state and are worth knowing.
Why is the rate higher than my bank pays?
Because the carrier knows how long it has the money. A bank has to be ready for a deposit to leave; an insurer with a seven-year contract can invest for seven years and pay you some of the difference.
What happens if I need the money early?
Most contracts allow a set amount out each year with no charge. Beyond that a surrender charge applies, falling each year until it reaches zero. The Can take out column on the table says what each product allows, so the ones that hold the money to the end are easy to spot before the rate wins you over.
Do I pay tax every year?
No. Interest inside an annuity is tax deferred, so nothing is owed until money comes out. That is one of the main reasons people choose one over a CD for money they do not need yet.
What happens when the term ends?
You can take the money, move it to another contract, or let it renew. Renewal rates are rarely the best on the market, so it is worth a conversation before the window closes rather than after.
How much do I need to start?
Most carriers start somewhere between ten and twenty-five thousand dollars, and many pay a better rate above one hundred thousand. The calculator only shows products your amount actually qualifies for.
Ready to Discuss Annuities with an Advisor?
Fifteen minutes with Steve Jurich, AIF®, CAS®, on which term fits and what to do when it ends.