Introduction
Annuities are financial products designed to provide retirees with a steady stream of income. They come in various forms, each offering unique features and benefits tailored to suit individual retirement needs. In this article, we will discuss the top fixed annuity rates for all types of fixed annuities, including Multi-year guaranteed annuities (MYGAs) and traditional fixed annuities. We will cover specific rates in this article and dive into the factors that affect these rates and the advantages and disadvantages of each type of annuity.
Fixed Annuities
Fixed annuities offer a guaranteed interest rate for a predetermined period, providing a stable and secure income for retirees. When comparing fixed annuity rates, consider the following factors:
Contract term: The length of the contract will affect the interest rate offered. Longer terms usually provide higher interest rates. However, tying up your money for an extended period can also increase the risk of inflation eroding your purchasing power over time.
The financial strength of the issuing company: The credit rating and financial stability of the insurance company are essential as they guarantee the payment of the annuity. Look for companies with strong financial ratings from independent agencies like A.M. Best, Standard & Poor's, or Moody's.
Additional features: Some fixed annuities offer optional benefits such as inflation protection or death benefits, which may impact the interest rate. These riders can provide added security but often come at an additional cost.
Advantages
- Guaranteed and predictable income: Fixed annuities provide a stable income stream that doesn't fluctuate with market conditions.
- Low investment risk: The principal is protected, and returns are guaranteed, making fixed annuities a safer investment option.
- Protection of principal: The initial investment remains intact, regardless of market fluctuations.
Disadvantages
Limited growth potential: The returns on fixed annuities are generally lower than other investment options due to their conservative nature.
Inflation risk: Over time, inflation may erode the purchasing power of the fixed income stream, reducing its value in real terms.
Less flexibility than other types of annuities: Fixed annuities typically have limited options for withdrawal and payout structures.
Strategies for Finding The Best Fixed Annuity Rates:
Shop around and compare rates from multiple insurance companies.
Consider shorter-term contracts, as they may offer higher rates in a rising interest rate environment.
Evaluate the benefits of optional riders and weigh their costs against the added security they provide.
Best Fixed Annuity Rates (Updated as of September 2024)
When it comes to fixed annuities, Multi-Year Guaranteed Annuities (MYGAs) and Traditional fixed annuities are two popular types of annuities, each with its own features and benefits. The primary difference between traditional fixed annuities and Multi-Year Guaranteed Annuities (MYGAs) lies in the interest rate guarantee period.
MYGAs offer a fixed interest rate for the entire term of the contract, usually ranging from 1 to 10 years. This provides the annuitant with a predictable, stable return on their investment throughout the contract term, but with limited flexibility in adapting to changing market conditions. On the other hand, Traditional fixed annuities guarantee a minimum interest rate for a short term, typically one year. After this period, the insurance company may adjust the interest rate periodically, subject to a guaranteed minimum rate.
The table below describes the best annuity rates for MYGAs, updated as of September 2024. It is important to know that lower-rated companies tend to offer higher rates to compensate for the additional risk that an annuitant takes (remember that annuities are beneficial only as long as the companies providing them maintain solvency). So, I will be mentioning the top MYGA rates for 1) Annuities that are A-rated and above and 2) Annuities that are rated below A separately.
Best Rated MYGAs (Only A-rated and above) as of September 2024
| Product | Company | AM Best | Minimum Premium | Years | Guaranteed Yield |
|---|---|---|---|---|---|
Ibexis MYGA Plus | Ibexis Life | A- | $100,000 | 7 | 5.90% |
Axonic Waypoint | AmFirst Insurance | A- | $100,000 | 5 | 5.50% |
Future Flex | GBU Financial | A- | $25,000 | 1 | 5.45% |
RetireMax Secure | LSW | A+ | $100,000 | 5 | 5.20% |
Platinum Assure | Americo Financial | A | $25,000 | 5 | 15 |
Bankers Elite | Liberty Bankers | A- | $10,000 | 5 | 5.15% |
Synergy Choice | Aspida | A- | $100,000 | 7 | 5.15% |
Multi Select | Oxford Life | A | $20,000 | 6 | 5.00% |
Athene MaxRate | Athene | A+ | $100,000 | 7 | 4.95% |
HarbourView | Oceanview Life | A | $80,000 | 10 | 4.95% |
MNL Guarantee Pro | Midland National | A+ | $100,000 | 7 | 4.90% |
NAC Guarantee Plus | North America Co | A+ | $100,000 | 7 | 4.90% |
Pinnacle Plus | Delaware Life | A- | $100,000 | 5 | 4.85% |
Preserve Multi-Year | Clear Spring Life | A- | $100,000 | 4 | 4.80% |
FG Guarantee Platinum | Fidelity and Guarantee Life | A- | $20,000 | 5 | 4.80% |
Secure Value | United Heritage | A- | $7,000 | 7 | 4.80% |
Milestone MYGA | Sagicor Life | A- | $100,000 | 5 | 4.75% |
Premier Voyage | MassMutual | A++ | $10,000,000 | 7 | 4.70% |
Palladium MYGA | American National | A | $250,000 | 6 | 4.70% |
SecureFore | GlobalAtlantic | A | $100,000 | 3 | 4.65% |
LunarGuard | AuguStar | A | $100,000 | 3 | 4.65% |
Multi-Choice | Standard Insurance | A | $100,000 | 5 | 4.65% |
MaxProtect | TruStage - CMFG | A | $100,000 | 3 | 4.60% |
Ultra Premier | United of Omaha | A+ | $25,000 | 7 | 4.60% |
Protective Secure Saver | Protective Life | A+ | $75,000 | 5 | 4.55% |
Select Max | Symetra Life | A | $250,000 | 5 | 4.55% |
SecureOption | Securian Financial | A+ | $500,000 | 9 | 4.55% |
Diamond Head | Pacific Guardian | A | $10,000 | 3 | 4.50% |
Reliance Guarantee | Reliance Standard | ++ | $20,000 | 5 | 5 |
SecureGrowth | Nationwide | A+ | $100,000 | 5 | 4.50% |
MYGuarantee Plus | Lincoln Financial | A | $100,000 | 5 | 4.40% |
American Pathway | American General | A | $100,000 | 6 | 4.40% |
SecureGain | MassMutual Ascend | A++ | $100,000 | 7 | 4.19% |
GuaranteeShield | American Equity | A- | $100,000 | 5 | 3.85% |
Exhibit 1: Best Rated MYGAs (Only A-rated and above) as of 27th September 2024
Note that I have listed one MYGA product of each annuity company that offers the highest rate. It is possible that multiple products of the same company may offer higher rates. For example, Aspida Synergy Choice 7 offers 5.15% for 7 years, and Aspida Synergy Choice 5 offers 5.10% for 5 years, which is higher than many of the MYGAs listed above. It is also important to understand that these rates tend to change frequently, and may vary from state to state. You should check the exact rate with your annuity provider on the day you sign up for an MYGA.
Best Rated MYGAs (Rated below A) as of September 2024
| Product | Company | AM Best | Minimum Premium | Years | Guaranteed Yield |
|---|---|---|---|---|---|
Certainty Select | EquiTrust Life | B++ | $10,000 | 10 | 5.45% |
Fee-based MYGA | American Life | B++ | $10,000 | 3 | 5.60% |
Excelera MYGA | Revol One | B++ | $25,000 | 7 | 5.40% |
Nassau MY Annuity | Nassau Life | B++ | $10,000 | 7 | 5.25% |
Navigator Ultra | Western United | B++ | $10,000 | 7 | 5.20 |
Safe Haven | Atlantic Coast | B++ | $5,000 | 7 | 5.05% |
Personal Choice | Sentinel Security | B++ | $2,500 | 5 | 5.05% |
Preferred Choice | Manhattan Life | B++ | $10,000 | 7 | 4.55% |
Exhibit 2: Best Rated MYGAs (Only rated below A) as of 27th September 2024
Note that I have listed one MYGA product of each annuity company that offers the highest rate. It is possible that multiple products of the same company may offer higher rates. For example, Nassau MY Annuity 7 offers 5.25% for 7 years, and Nassau MY Annuity 5 offers 5.20% for 5 years, which is higher than many of the MYGAs listed above. It is also important to understand that these rates tend to change frequently, and may vary from state to state. You should check with your annuity provider the exact rate on the day you sign up for an MYGA.
Best Rated Traditional Fixed Annuities as of September 2024
Unlike MYGAs, Traditional fixed annuities guarantee a minimum interest rate for a short term, typically one year. After this period, the insurance company may adjust the interest rate periodically, subject to a guaranteed minimum rate.
| Product | Company | AM Best | Minimum Premium | Years | First Year Guaranteed Yield | Guaranteed Minimum Term Yield* |
|---|---|---|---|---|---|---|
American Pathway | American General Insurance | A | $100,000 | 7 | 6.38% | 1.75% |
Wealth Quest Citadel Diamond | Amercian National Insurance | A | $100,000 | 7 | 6.20% | 3.55% |
Apollo-MVA | Reliance Standard Life Insurance | A++ | $5,000 | 7 | 6.05% | 1.71% |
Eagle 8 | United Heritage Life Insurance | A- | $8,000 | 10 | 6.00% | 3.30% |
Apollo-SP | Reliance Standard Life Insurance | A++ | $5,000 | 7 | 5.90% | 1.69% |
Liberty Select | Liberty Bankers Life Insurance | A- | $5,000 | 7 | 5.70% | 2.09% |
Liberty Choice | Liberty Bankers Life Insurance | A- | $5,000 | 5 | 5.00% | 1.79% |
FlexPlus | Guaranty Income Life Insurance | A- | $2,000 | 10 | 3.25% | 1.25% |
Exhibit 3: Best Rated Traditional Fixed Indexed Annuities as of 27th September 2024
; that the Guaranteed Minimum Term Yield, is the annual yield, including bonuses if applicable, up to the first penalty free full withdrawal window, assuming the interest rate is reduced to the contractually guaranteed minimum at the first available opportunity, for the duration of the term.
Conclusion
In this comprehensive guide, we have explored the various fixed annuity rates, including traditional fixed annuities and MYGA rates, as well as their respective advantages and disadvantages. As you search for the best fixed annuity rates for each of these annuity types, it's essential to consider not only the rates themselves but also the factors that impact them and how well they align with your retirement goals and financial situation.
By understanding the unique features and benefits of each fixed annuity type, you can make an informed decision about which product best suits your needs. Keep in mind that annuities are long-term investments and should be considered as part of a comprehensive retirement plan. It's always a good idea to consult with a financial advisor to ensure that an annuity is the right choice for your individual needs and circumstances. By doing so, you can confidently build a retirement income strategy that provides financial security and peace of mind during your golden years.