(Annuity interest rates can vary between states and are subject to change pending company announcement. We update our fixed rates on a regular basis. Some policies are not available in some states. Additionally, rates may be lower with some accounts if certain liquidity features are desired.)
Short Term and Long Term Annuities For Safety
Our clients are in search of the best annuity rates with the most highly rated carriers available. We offer both short-term and longer term accounts that can meet your needs for safety, tax-deferred growth, income and wealth transfer.
As interest rates are improving, we see the most demand for 5 year annuities offering high rates and guaranteed returns. We are licensed with several insurance companies offering yields above 3%. Assuming the economy continues to improve, 4% rates or return may be just around the corner.
It’s really a matter of what terms best suit your needs and budget. We can tailor several strategies in order to maximize growth, income and returns. Using a laddering strategy, you can have your annuity portfolio turn over every couple of years I order to maximize liquidity. This can also help to take advantage of increasing interest rates.
Fixed Interest Accounts Vs. Floating Rate Policies
Fixed annuities come in two forms – MYGA (multi-year guaranteed annuity) and floating rate accounts. MYGA’s are the most popular and the most common.
With multi-year accounts, your rate is locked in for the duration that you choose. The rate is guaranteed by the insurance company and will neither increase or decrease over the selected term.
Less common are floating rate fixed annuity accounts. Interest rates can fluctuate each year and may increase or decrease depending on the economic environment. All policies will include a floor (minimum interest rate) that cannot be breached. Floating rate annuities can be advantageous in an increasing interest rate cycle. Multi-year annuity accounts have been more popular with our clients as they provide more certainty and guarantees.
Multi-Year Guaranteed Annuity Accounts - MYGAs
A multi-year guaranteed annuity most closely resembles a bank CD. While the two are of course different – and offered by different institutions – the concept is the same. Only insurance companies offer MYGAs. They can be purchased through agents and banks, but they are offered and insured by large insurance companies.
MYGAs offer a guaranteed rate for the term you choose. Five year annuity plans (like those listed above) are most popular. Just like a CD, your rate will not go below the percentage yield that is guaranteed at purchase. In fact, some even have the ability to increase each year, but they can never go down below the rate stated at issue.
Unlike CDs, these plans allow you to take your interest as taxable income – or defer it for as long as you wish. And annuities tend to offer higher returns than almost all comparable bank instruments offered today. The other piece of good news: Annuity rates are on the rise finally! We are seeing much more interest in our MYGA accounts now as their safe, insured, and guaranteed rates of return offer a viable option to more risk investments.
Comparing Bank CDs To Fixed Annuities
If you already own an annuity, you know exactly how they work. They are safe and reliable policies designed for risk averse consumers. The investment they most closely resemble are certificates of deposit (CDs) at the bank. Watch this short video to understand the pros and cons of each:
Guaranteed Monthly Income & Tax-Deferred Accounts
Our clients purchase fixed annuities for several reasons. Safety of principal and guaranteed interest rates are certainly two of the most important factors. Annuity contracts can also create guaranteed systematic income streams or tax-deferred growth, but not at the same time. In other words, they are very flexible. You may want to defer gains now in order for larger payout in retirement.
We can provide products for both situations. We help those needing immediate interest income now as well as those wanting to defer gains while reducing their taxable income. It’s important to note that if you’re wanting income now, annuities work best for those over age 59 1/2. Those who are under this age and only taking interest income from a fixed annuity can be assessed a penalty by the IRS. Most fixed annuities work best for those who are preparing for retirement or looking for income once beyond age 59 1/2.
Our agency offers a wide range of fixed annuity rates and terms from the leading, highly-rated insurance companies. We are constantly licensing with new carriers to offer our clients the best fixed rates of return on their investment dollars. We will be happy to send you brochures, policy specs, and company financials on the fixed annuities you are most interested in.
Contact Us For Quotes, Details & Information
*Annuity interest rates are subject to change. We will update rate changes as soon as we are notified by the insurance company. Not all annuity accounts are available in all states. It is best to speak with one of our licensed insurance agents to learn more about what is available in your area.
*Multi-year fixed annuities provide a guaranteed interest rate for the selected number of years, but the rates are not guaranteed beyond that term and are only as safe as the carrier offering the plan. In most states, annuity accounts are insured up to $250,000.