Multi-Year Guaranteed Annuity for Retirees
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Multi-Year Guaranteed Annuity for Retirees plans give you predictable growth and peace of mind when markets are choppy. For many retirees, stability and predictability are two of the most valuable qualities you can build into your retirement strategy. A Multi-Year Guaranteed Annuity (MYGA) provides exactly that: guaranteed fixed growth for a set term. At Diversified Insurance Brokers, we help retirees nationwide evaluate whether MYGAs are a strong fit for their goals, income needs, and time horizons.
What Is a Multi-Year Guaranteed Annuity?
A Multi-Year Guaranteed Annuity is a type of fixed annuity that locks in a guaranteed interest rate for a chosen period, usually between 2 and 10 years. Unlike variable or indexed annuities, your principal is never at risk of market downturns. This makes MYGAs a favorite option for retirees who want predictable growth and principal protection.
Why Retirees Choose a Multi-Year Guaranteed Annuity
MYGAs are particularly attractive for retirees looking to replace bonds or CDs in their portfolios. They typically offer higher yields than CDs, and while bank products are backed by the FDIC, annuities are supported by the issuing insurer and state guaranty associations within coverage limits. For those nearing or in retirement, MYGAs create a foundation of guaranteed growth that complements Social Security benefits and pension income.
- Predictable Growth: Fixed interest rate locked for the entire term.
- Tax-Deferred Earnings: Taxes are delayed until withdrawals are made, enhancing compounding.
- Safety: Principal protected against market losses.
- Flexible Terms: Choose contract lengths that match your personal retirement timeline.
How MYGAs Work in Retirement Planning
When you purchase a MYGA, you agree to keep funds in the contract for the selected term. During that time, the insurer guarantees a fixed rate of return. At maturity, you can withdraw the funds, renew into a new MYGA, or transition into an income annuity. Some retirees also use MYGAs within IRAs, which must be coordinated carefully with RMD rules under SECURE 2.0.
How a MYGA Fits a Retiree’s Income Plan
This structure allows retirees to segment safe assets for near-term needs while still achieving predictable growth. A MYGA can be paired with death benefit options to ensure heirs are protected while still enjoying fixed growth.
Example: Laddering MYGAs
Consider a 67-year-old retiree with $200,000 set aside for safe growth. Instead of placing it all into one contract, they split it between a 3-year and 5-year MYGA. This ladder ensures part of the funds are accessible sooner, while the longer-term MYGA locks in a higher rate. This mirrors a bond ladder but with tax deferral and no market risk.
💰 Current Fixed Annuity Rates (as of September 2025)
| Term | Rate | Provider | Product | AM Best Rating |
|---|---|---|---|---|
| 1 Year | 4.15% | GCU Life | 1+4 Choice | A- |
| 2 Years | 5.25% | CL Life | CL Sundance | B++ |
| 3 Years | 6.10% | Wichita National | Security 3 MYGA | B+ |
| 4 Years | 5.30% | Americo Financial Life and Annuity | Platinum Assure | A |
| 5 Years | 6.25% | Wichita National | Security MYGA | B+ |
| 6 Years | 5.90% | Atlantic Coast Life | Safe Harbor Bonus Guarantee | B+ |
| 7 Years | 6.10% | Wichita National | Security MYGA | B+ |
| 8 Years | 5.65% | EquiTrust Life Insurance Company | Certainty Select | B++ |
| 9 Years | 5.35% | Clear Spring Life and Annuity | Preserve MYGA | A- |
| 10 Years | 6.05% | Wichita National | Security MYGA | B+ |
Lifetime Income Calculator
Case Study: John & Susan
At age 70, John and Susan wanted growth without risk. They placed $150,000 into a 7-year MYGA, securing guaranteed interest while leaving other assets liquid. When the contract matures, they can roll it into a new annuity or use it to fund living expenses. This complements their qualified charitable distributions strategy and retirement income plan.
Who Should Avoid MYGAs?
Not every retiree should choose a multi-year guaranteed annuity. If you need full liquidity, anticipate large unexpected expenses, or want direct market exposure, MYGAs may not be a perfect fit. In these cases, we explore alternatives such as annuities with flexible withdrawal provisions or blended strategies with indexed annuities.
FAQs: Multi-Year Guaranteed Annuity for Retirees
What is the typical term length for a MYGA?
MYGAs usually range from 2 to 10 years, with most retirees choosing 3, 5, or 7-year terms.
How safe are MYGAs?
They are backed by the issuing insurance company and state guaranty associations within legal limits.
Are MYGA rates higher than CDs?
Yes, MYGA rates are often significantly higher than CDs of the same term.
What happens when a MYGA matures?
You can withdraw the funds, renew into another MYGA, or roll into an income annuity.
Can I withdraw early?
Most MYGAs have surrender charges for early withdrawals, but many allow up to 10% free annually.
Do MYGAs offer tax deferral?
Yes, growth is tax-deferred until withdrawals are made, which enhances long-term compounding.
Can I use a MYGA inside an IRA?
Yes, MYGAs can be purchased inside IRAs, but they must align with RMD rules.
How do MYGAs compare to fixed indexed annuities?
MYGAs offer simplicity and fixed rates, while FIAs provide growth potential tied to an index.
Can I leave my MYGA to beneficiaries?
Yes, most contracts include beneficiary death benefits to ensure funds pass directly to heirs.
What happens if the insurer fails?
Policies are covered by state guaranty associations up to statutory limits.
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About the Author:
Jason Stolz, CLTC, CRPC, is a senior insurance and retirement professional with more than two decades of real-world experience helping individuals, families, and business owners protect their income, assets, and long-term financial stability. As a long-time partner of the nationally licensed independent agency Diversified Insurance Brokers, Jason provides trusted guidance across multiple specialties—including fixed and indexed annuities, long-term care planning, personal and business disability insurance, life insurance solutions, and short-term health coverage. Diversified Insurance Brokers maintains active contracts with over 100 highly rated insurance carriers, ensuring clients have access to a broad and competitive marketplace.
His practical, education-first approach has earned recognition in publications such as VoyageATL, highlighting his commitment to financial clarity and client-focused planning. Drawing on deep product knowledge and years of hands-on field experience, Jason helps clients evaluate carriers, compare strategies, and build retirement and protection plans that are both secure and cost-efficient.
