Quick answer
A MYGA, or multi-year guaranteed annuity, is a fixed annuity that locks in a guaranteed interest rate for a set term, typically 2, 3, 5 or 10 years. It works a lot like a CD, often pays more and delays taxes until you withdraw. If you want predictable growth with no market exposure, it's worth a serious look.
A MYGA (multi-year guaranteed annuity) is a fixed annuity that locks in a guaranteed interest rate for a set term — typically 2, 3, 5, or 10 years — making it a low-risk way to grow money with no market exposure and tax-deferred interest. It works a lot like a CD, but often pays more and delays taxes until you withdraw. If you’re a retirement saver looking for predictable, safe growth, a MYGA is worth a serious look.
What Is a MYGA Annuity?
A MYGA is one of the simplest insurance products you can buy. You hand an insurance company a lump sum — typically $10,000 or more — and they guarantee a fixed interest rate for a specific number of years. No market risk. No variable returns. Just a locked-in rate, compounding tax-deferred until you decide to take money out.
How a Multi-Year Guaranteed Annuity Works
Here’s the basic flow:
- You choose a term (2, 3, 5, or 10 years) and make a single premium payment.
- The insurer credits interest at the guaranteed rate each year.
- Your money grows tax-deferred — you don’t owe taxes until you withdraw.
- At the end of the term (the surrender period), you can withdraw everything, roll it into a new annuity, or annuitize it for income.
During the term, most MYGAs allow a free annual withdrawal of up to 10% of your account value without penalty. Take more than that before the term ends and you’ll face a surrender charge — a fee that typically starts high (7–10%) and decreases each year.
Is a MYGA a Fixed Annuity?
Yes. A MYGA is a type of fixed annuity. The distinction is that most fixed annuities renew rates annually, while a MYGA locks your rate for the entire term. That makes MYGAs more predictable — you know exactly what rate you’re getting from day one.
What Is a MYGA Annuity Withdrawal?
A MYGA withdrawal is any money you pull out before the contract ends. Most contracts let you take up to 10% per year penalty-free. Exceed that and surrender charges apply. There’s also ordinary income tax on the earnings portion of any withdrawal, and a 10% IRS penalty if you’re under 59½. The key downside of a MYGA is this lack of liquidity — your money is largely tied up for the contract term.
Highest MYGA Rates Today
Rates shift daily based on interest rate environments, so always confirm current numbers before you buy. That said, here’s a snapshot of what the market has been offering. If you’re ready to compare today’s highest MYGA rates from top-rated carriers, a free personalized quote from an annuity comparison service is the fastest way to see live numbers.
Top 10 Highest MYGA Rates
The highest rates at any given time tend to cluster around 5-year terms, where insurers can offer more in exchange for your longer commitment. Rates move with the broader interest rate environment, so check a current rate table before you buy and compare the same term across several highly rated carriers.
Key things to know about top-rate MYGAs:
- Higher rates sometimes come from lower-rated carriers — always check AM Best rating (A- or better is the standard benchmark).
- Rates are often tiered by premium amount; putting in $100,000 or more frequently unlocks a higher rate than smaller deposits.
- Some carriers offer a “rate bump” for the first year, then a slightly lower guaranteed rate for the remaining term — read the fine print.
Highest MYGA Rates for Seniors
Seniors often prioritize safety and simplicity over maximizing every basis point. For that reason, the best MYGA rates for seniors typically come from A-rated or better carriers offering 3- to 5-year terms. Shorter terms give seniors more flexibility as their situation changes, while still earning meaningfully more than most bank savings accounts or short-term CDs.
What Is the Highest Paying MYGA Annuity Rate?
The single highest paying MYGA rate at any moment depends on the term, premium amount, and issuing carrier. Because rates move with the broader interest rate environment, the best time to lock in is when rates are near cycle highs, and the only way to know today’s top rate is to compare current quotes.
MYGA Annuity Rates by Term
Your term choice matters a lot — not just for the rate you’ll get, but for how long your money is tied up. Here’s how rates typically compare across terms:
| Term | Typical Rate Range | Best For |
|---|---|---|
| 2-Year | 4.00%–5.00% | Near-term liquidity needs |
| 3-Year | 4.50%–5.50% | Balance of rate and flexibility |
| 5-Year | 5.00%–6.00% | Maximizing guaranteed return |
| 10-Year | 4.75%–5.75% | Long-term tax-deferred accumulation |
Rates are illustrative; confirm current rates before purchasing.
2-Year MYGA Rates
Two-year MYGAs offer the least rate in exchange for the shortest commitment. They’re useful if you think rates might rise and you want to be free to roll into a higher-rate product soon. Think of them as a stepping stone, not a destination.
3-Year MYGA Rates
Three-year terms hit a sweet spot for many savers — rates are meaningfully better than short-term CDs, and you’re not locked up as long as a 5-year product. Solid choice if you have a mid-term goal like a home purchase or a known cash need in three to four years.
5-Year MYGA Rates
Five-year MYGAs typically offer the best rates of any term. Most comparison shoppers land here. If you don’t need the money for at least five years, this is usually where you get the best return for the risk you’re taking.
10-Year MYGA Rates
Ten-year MYGAs don’t always pay more than 5-year products — insurers don’t always reward longer commitments linearly. Rates can actually dip slightly compared to 5-year offerings. The main benefit is a decade of tax-deferred compounding without the temptation (or cost) of early withdrawal.
On the $100,000 question: A $100,000 MYGA doesn’t pay monthly income by default. It accumulates tax-deferred. If you convert it to income (annuitize), what it pays each month depends on your age, the payout option and current rates, so ask for a quote or run your numbers through an annuity payout calculator.
Best MYGA Annuity Rates by Company
Not all carriers are created equal. Rate matters, but so does financial strength — you need the company to be around when your term ends.
Nationwide MYGA Rates
Nationwide is one of the largest and most recognizable names in the annuity space, carrying strong financial strength ratings. Their MYGA products are competitive, particularly for savers who value the backing of a household name. Rates vary by term and premium amount, so checking their current offerings directly or through a broker is the right move.
MassMutual MYGA Rates
MassMutual consistently earns top marks for financial strength (AM Best A++ rating) and offers straightforward MYGA products. Their rates may not always be the absolute highest on the market, but the security of a mutual company with over 170 years of history appeals to conservative savers — especially retirees who prioritize certainty over squeezing out an extra 0.25%.
Best 5-Year MYGA Rates by Carrier
When comparing 5-year MYGA rates, you’ll typically find a mix of national insurers and regional carriers competing for your business. Beyond Nationwide and MassMutual, names like American Equity, Atlantic Coast Life, and Midland National frequently appear at the top of rate comparison tables. Always pair the rate with an AM Best rating check before committing.
MYGA vs CD: Which Pays More?
This is the question most people are really asking when they start researching MYGAs. The short answer: MYGAs usually pay more, but with different trade-offs.
MYGA vs CD Pros and Cons
| Feature | MYGA | CD |
|---|---|---|
| Guaranteed rate | Yes | Yes |
| Tax-deferred growth | Yes | No (taxed annually) |
| FDIC insured | No (state guaranty funds) | Yes |
| Early withdrawal penalty | Surrender charge (can be steep) | Typically 3–6 months interest |
| Typical 5-year rate | 5.00%–6.00% | 4.00%–5.00% |
| Minimum deposit | $5,000–$10,000 | Often $500–$1,000 |
MYGA vs CD Calculator
To really compare, you need to model after-tax growth. A $100,000 CD at 4.5% pays roughly $4,500/year in taxable interest — if you’re in the 22% bracket, you keep about $3,510. A MYGA at 5.5% earns $5,500 in year one, none of which is taxed until withdrawal. Over five years, that tax deferral compounds noticeably in the MYGA’s favor, especially in higher tax brackets.
Is a MYGA Better Than a CD?
For most retirement savers in mid-to-higher tax brackets who won’t need the money during the term, yes — MYGAs typically win. The combination of higher rates and tax deferral is hard to beat. CDs have the edge for people who want FDIC insurance, might need the money early (CD penalties are lighter), or are in very low tax brackets where deferral matters less.
MYGA Rates Calculator
A MYGA calculator helps you see what a lump sum will grow to over the contract term, and what taxes you’ll owe at withdrawal. Most annuity comparison platforms include one.
How to Use a MYGA Annuity Rates Calculator
Input these four things:
- Premium amount — how much you’re investing
- Guaranteed rate — the rate from your chosen carrier
- Term length — 2, 3, 5, or 10 years
- Tax bracket — to estimate after-tax yield vs. a taxable CD
The calculator will show ending account value and, if you enter a CD rate for comparison, the after-tax difference between the two.
Best 5-Year Fixed Annuity Rates Calculator
For 5-year comparisons, the calculator output is most useful when you plug in your actual marginal tax rate. A retiree in the 12% bracket sees a smaller benefit from tax deferral than someone in the 24% bracket. Run both scenarios to see if the MYGA premium over a CD is worth the reduced liquidity for your situation.
How to Buy a MYGA Annuity
Buying a MYGA is simpler than most insurance products. You don’t need to answer health questions or go through underwriting. It’s a financial transaction, not a medical one.
Where to Buy a MYGA
You can buy a MYGA through:
- An independent insurance agent or broker — access to multiple carriers, can shop rates for you
- A financial advisor — good if they’re fee-only; watch for commission conflicts
- Direct from a carrier — limits you to that carrier’s products
- Online comparison platforms — fastest way to see multiple carriers’ current rates side by side
What to Look for in the Best MYGA for Seniors
For seniors, prioritize in this order:
- Financial strength — AM Best A- or better
- Rate — competitive for the term you want
- Free withdrawal provision — at least 10% annually
- Surrender period length — shorter terms reduce lock-up risk
- Death benefit — most MYGAs pass full account value to beneficiaries, avoiding probate
How to Use a 1035 Exchange to Fund a MYGA
If you already have a life insurance policy or another annuity with accumulated cash value, you can move that money into a MYGA tax-free using a 1035 exchange. The key rules: the exchange must be direct (carrier to carrier), it must be a like-kind transfer (insurance/annuity to annuity), and you cannot touch the money in between. A 1035 exchange lets you upgrade to a higher rate without triggering a taxable event — one of the most underused tools in retirement planning.
Frequently Asked Questions
What is the downside of a MYGA annuity?
The main downsides are limited liquidity and surrender charges. Most MYGAs allow a 10% annual free withdrawal, but taking out more triggers surrender charges that can run 7–10% in the early years of the contract. There’s also no FDIC insurance — your protection comes from state guaranty associations, which have coverage limits that vary by state. And earnings are taxed as ordinary income (not capital gains) when you withdraw.
Is a MYGA better than a CD?
For many retirement savers, yes. MYGAs typically offer higher rates than CDs of similar terms, and interest grows tax-deferred — you don’t pay taxes annually on the earnings like you do with a CD. The trade-off is that surrender charges are steeper than CD early-withdrawal penalties, and MYGAs aren’t FDIC insured. If you won’t need the money during the term and you’re in a meaningful tax bracket, MYGAs usually come out ahead.
What kind of annuity is a MYGA?
A MYGA is a fixed annuity — specifically, a multi-year guaranteed annuity. That means the interest rate is fixed and guaranteed for the full contract term, unlike a variable annuity (which invests in market subaccounts) or a fixed-indexed annuity (which ties returns to an index like the S&P 500). Of the three main annuity types, MYGAs are the most straightforward and the closest to a CD in how they behave.
What is the highest paying MYGA annuity rate?
The highest MYGA rates at any given time depend on the term, the insurer, and the current interest rate environment. Rates change daily, so the best approach is to use a comparison tool to see live rates, and always verify the carrier’s AM Best rating before committing.
How much will a $100,000 annuity pay monthly?
A $100,000 MYGA doesn’t automatically generate monthly income. It accumulates value during the term. If you annuitize it (convert it to a lifetime or period-certain income stream), the payout depends on your age, gender, payout option, and current interest rates. For an exact number, run your specifics through an annuity payout calculator or request a quote from a carrier.