Looking for the best 2-year annuity rate? You’re not alone. Fixed annuities with a 2-year term (often marketed as MYGAs) offer a balance of yield and moderate commitment. At Diversified Insurance Brokers, we compare offerings from over 75 top-rated carriers to help you find competitive rates without pressure or hidden fees.

A 2-year fixed annuity locks in a guaranteed rate for a full 24 months. At the end of that period, you can renew, roll into a different term, or withdraw your money—all while enjoying the principal protection and tax-deferral benefits common to annuities. If you want a bit more yield than a 1-year product but still retain relative flexibility, a 2-year MYGA could be an ideal middle ground.

What Is a 2-Year Fixed Annuity?

A 2-year fixed annuity is a contract with an insurance company that guarantees a fixed interest rate for a 24-month term. Your principal is protected, and the interest compounds tax-deferred until withdrawal. At maturity, you generally have options to renew, roll over, or withdraw, depending on the contract terms.

Who Should Consider a 2-Year Annuity?

The 2-year MYGA is well suited for savers who want more yield than a 1-year term but still want to maintain a relatively short commitment. You might consider a 2-year annuity if you are:

• Expecting interest rates to rise moderately over the next few years.
• Rolling over maturing CDs or short-term cash into a safer yield vehicle.
• Building a laddered strategy combining short-to-medium terms (1, 2, 3, 5 yrs).
• Allocating funds you won’t need immediately but prefer a shorter lock-up than longer-term contracts.
• Wanting a safe, predictable place to park capital in an uncertain market environment.

As with a 1-year product, the safety of your principal is backed by state insurance regulations and the financial strength of the issuing carrier. We only recommend carriers rated “A-” or better by agencies like AM Best to ensure strong creditworthiness and reliability.

Benefits of a 2-Year MYGA

Choosing a 2-year fixed annuity offers these advantages:

• Guaranteed Interest Rate: Locked in for 24 months—no exposure to market volatility.
• Tax-Deferred Growth: Interest compounds without annual taxation until withdrawal.
• Renewal Flexibility: At the end of term, you can renew, roll over, or withdraw funds.
• Possible Penalty-Free Access: Many contracts allow up to 10% of the account value accessible annually without surrender charges (check contract terms).
• Better Yield than 1-Year: Generally, longer terms offer slightly higher rates, compensating for the longer commitment.

Why Rates Change Frequently

Fixed annuity yields reflect bond market conditions, carrier portfolio strategies, and macroeconomic influences. Because of that, rates can shift often. The “best 2-year annuity rate” today might not hold tomorrow. That’s why we maintain close partnerships with carriers and monitor rate updates daily to ensure your comparisons are current.

Even a difference of 0.15% or 0.20% can compound into meaningful extra earnings across the term. Our goal is to capture those opportunities for you in real time.

How to Compare 2-Year Annuity Options

When evaluating a 2-year MYGA, consider more than just the headline rate. Key features to compare include:

• Carrier Financial Strength: Choose insurers rated “A-” or higher by AM Best, S&P, or Moody’s.
• Renewal Terms: Some contracts auto-renew; others require you to make an election.
• Liquidity Provisions: Ensure the contract allows limited withdrawals without penalty (e.g., 10%).
• Minimum Deposit: Often between $10,000 and $25,000, but varies.
• Market Value Adjustment (MVA): Understand whether the contract includes an MVA and how early withdrawals may be affected. (See our Market Value Adjustment Explained guide.)

Using a 2-Year Annuity Within a Ladder Strategy

Laddering is a strategy whereby you spread annuity purchases across varying term lengths to ensure periodic access to funds and the ability to reinvest at new rates. A 2-year MYGA slot is often a sweet spot — not as short as 1 year, but not as long as 5 or 10 years. As each rung matures, you reinvest or adjust according to rate trends.

Comparing 2-Year MYGAs vs. CDs & Money Markets

It’s useful to see how 2-year annuities stack up against traditional fixed-income alternatives:

• Tax Treatment: With annuities, earnings are tax-deferred until withdrawal, unlike CDs that are taxed annually.
• Yield Potential: Insurance companies often can offer more attractive fixed rates because of their investment models.
• Guarantee & Safety: Fixed annuities offer principal protection backed by the insurer and state guaranty associations.
• Flexibility: At maturity, you can roll into another term, withdraw, or move into an income annuity or indexed option.

Many clients use 2-year MYGAs as a transition between very short-term holdings and longer-term commitments, or as a building block in a laddered approach aiming for both liquidity and yield.

Next Step: Compare Current Fixed Annuity Rates

To view the most up-to-date 2-year MYGA offers and carrier-specific rates, check out our Fixed Annuity Rate Page. Markets evolve fast — staying updated ensures you don’t miss higher rate opportunities.

Related Topics to Explore

• Best Short-Term MYGA Annuities
• Tax-Deferred Annuity Strategies
• Annuity Surrender Charges Explained
• Guaranteed Lifetime Withdrawal Benefits Explained
• Annuity Rollover Options for Teachers