Wichita National Life Security 5 Annuity – A Safe, Predictable Option for Retirement Growth

Unlike variable investments tied to market performance, the Security 5 MYGA locks in a declared interest rate for the entire five-year guarantee period. That means your principal is protected from market losses, and your interest rate does not fluctuate during the term. For retirees who cannot afford another 2008-style downturn, this kind of predictability can be invaluable. Interest compounds daily, maximizing accumulation over time, and growth is tax-deferred until funds are withdrawn. Tax deferral allows your money to compound without annual 1099 taxation, which can meaningfully increase long-term results compared to taxable savings vehicles. Our breakdown of Fixed vs. Indexed Annuities can help you determine which structure aligns best with your timeline and risk tolerance if you are still evaluating both approaches.

Wichita National Life Security 5 MYGA: Key Product Features at a Glance

The Wichita National Life Security 5 is structured as a single premium deferred annuity, meaning you fund it with a lump sum deposit and allow it to accumulate over the five-year period. The current minimum premium is $10,000, making it accessible to many retirees, while larger deposits can be accommodated within carrier guidelines. Because this is a MYGA, the interest rate is declared upfront and guaranteed for the full surrender term. There are no participation rates, caps, spreads, or index credits to calculate — just straightforward, predictable compounding. For investors seeking clarity and simplicity, that transparency is a major advantage. Many clients who previously relied on CDs are surprised to learn that MYGAs often offer more competitive yields while maintaining principal guarantees backed by the claims-paying ability of the issuing insurance company.

Liquidity is an important consideration in any retirement strategy. The Security 5 MYGA includes penalty-free Required Minimum Distribution (RMD) withdrawals for qualified accounts, ensuring compliance without unnecessary fees. The optional 10% Free Withdrawal Rider — available for a 0.15% annual reduction in your declared rate — allows you to withdraw up to 10% of the contract value annually after the first year without surrender charges. This rider is not included in the base contract; buyers who anticipate needing periodic access to funds during the guarantee period should evaluate whether the rider’s liquidity benefit justifies the rate reduction it costs. The full mechanics of how surrender schedules work — and when penalties apply — are covered in our Annuity Surrender Charges Explained guide.

Like most MYGAs, the Security 5 includes a defined surrender charge schedule during the five-year guarantee period. Withdrawals above the free amount during that term may be subject to surrender charges and, in certain situations, a Market Value Adjustment (MVA). An MVA can increase or decrease the amount received depending on prevailing interest rate movements at the time of withdrawal — if rates have risen since you purchased, the MVA may reduce your withdrawal value; if rates have fallen, it could increase it. The MVA does not apply to the guaranteed death benefit payout or the guaranteed minimum surrender value. Our full breakdown of the interaction between surrender charges and MVA explains the mechanics in plain terms.

Another important feature of the Security 5 MYGA is its death benefit structure. In the base contract, beneficiaries receive the surrender value at the time of death — the accumulated account value minus any applicable surrender charges and MVA. Buyers who want their beneficiaries to receive the full account value without those deductions should evaluate the optional Enhanced Death Benefit Rider, available for an additional 0.15% annual rate reduction. This rider ensures that the death benefit equals the full accumulated account value regardless of when during the guarantee period the owner passes away. Spousal continuation provisions are standard on all Security 5 contracts, allowing a surviving spouse named as beneficiary or joint owner to step into the contract and continue it as the new owner — maintaining the accumulation strategy and avoiding a forced distribution event.

At the end of the five-year guarantee period, you are not locked into a single outcome. You may renew the contract at a new declared rate, withdraw funds without surrender penalties during the renewal window, or convert the accumulated balance into a structured income stream. For retirees seeking guaranteed income, annuitization can transform accumulated value into predictable payments — the mechanics and planning implications of that conversion are covered in our guide to Annuity Options for Retirees Without Pensions. One critical planning note: if no action is taken during the renewal window, the contract automatically renews for another five-year term at a new declared rate with a new surrender schedule. Mark the maturity date and review renewal terms well in advance.

Tax treatment is another reason many retirees choose MYGAs. Growth inside the contract is tax-deferred, meaning you do not pay taxes annually on interest earned. Withdrawals are taxed on a last-in, first-out (LIFO) basis for non-qualified funds, and qualified accounts follow standard IRA taxation rules. Understanding the annuity exclusion ratio — which governs how much of each non-qualified annuity payment represents taxable interest versus tax-free return of premium — is critical when coordinating withdrawals with Social Security income and other retirement assets. Our overview of Taxation of Annuities Explained provides the complete framework.

Choosing the right annuity is not just about rate — it is about fit. At Diversified Insurance Brokers, we compare top-rated carriers nationwide and help clients evaluate product strength, financial ratings, liquidity provisions, and long-term flexibility. Because we represent over 100 carriers, our evaluation of the Security 5 always runs alongside alternatives from A-rated carriers so you can make a genuinely informed comparison. Our breakdown of Best Annuity Companies Compared provides context on how AM Best ratings translate to real-world carrier strength before making a final decision.

The Security 5 Within the Wichita National MYGA Family

The Security 5 is one of four guaranteed-term products in Wichita National Life’s annuity lineup. The full Security series covers terms of three, five, seven, and ten years — each structurally identical in mechanics but differing in the length of the rate guarantee and surrender period, and typically in the declared interest rate itself. Understanding how the Security 5 fits relative to its siblings helps buyers determine whether the five-year commitment is the right duration, or whether a shorter or longer term better matches their accumulation timeline and income planning needs.

The Security 3 is the shortest commitment in the series. A three-year term provides the fastest path to a penalty-free maturity date, making it suitable for buyers with near-term liquidity needs or those who want to reposition funds every few years as interest rates change. Our dedicated page on best 3-year annuity rates shows how a Security 3 compares against A-rated competitors at current rate levels. The trade-off for a shorter term is typically a lower declared rate — carriers that can invest the premium over five or seven years can offer higher crediting than on a three-year commitment.

The Security 7 and Security 10 serve buyers with longer accumulation horizons who can accept reduced liquidity in exchange for a higher locked-in rate over the full guarantee period. A seven-year term aligns well with buyers who are 58–65 and want to lock in today’s rates through the heart of their pre-retirement accumulation phase. Our comparison of best 7-year annuity rates and best 10-year annuity rates provides the market-wide competitive context for those terms at current rate levels. When evaluating the Security 7 or Security 10 specifically, confirming the surrender charge schedule and renewal window timing against a competing A-rated carrier for the same term is an essential step — the longer the commitment, the more important the carrier’s financial strength rating becomes as a factor in the evaluation. For buyers who are new to MYGAs and want to understand how the guarantee structure works before choosing a term, our overview of how multi-year guaranteed annuities work is the foundation.

The Security 5 occupies the middle position in the Wichita National lineup — long enough to typically produce a more competitive rate than the 3-year term, short enough to avoid the extended liquidity restriction of a 7- or 10-year commitment. For buyers who are uncertain about committing longer and who want a rate they can trust for five years while retaining the ability to reallocate at maturity, the five-year term often hits the right balance. The key planning question is always the same: do you need access to these funds within five years? If the answer is yes — even possibly — the surrender charge schedule and the absence of a built-in nursing home or terminal illness waiver on this product make it inappropriate for funds that may be needed on short notice.

The Optional Riders: What They Cost and When They Are Worth It

The Security 5’s rider structure requires careful attention because both available riders reduce your declared interest rate by 0.15% per year each. At first glance that may seem minor, but over a five-year guarantee period, a 0.15% annual reduction compounds to a meaningful difference in accumulated value — particularly on larger premiums. The decision to add either or both riders is not a default; it is a cost-benefit calculation that should be run explicitly before application using the actual current declared rate, the premium amount, and the specific liquidity or death benefit scenario each rider addresses.

The 10% Free Withdrawal Rider is worth its cost for buyers who genuinely anticipate making periodic withdrawals during the guarantee period and cannot otherwise plan around the 10% per year limit. For a $100,000 premium at a current declared rate of, say, 5.50%, adding the free withdrawal rider at 0.15% reduces your effective rate to 5.35% — a difference of approximately $750 in year-one interest on that premium. Over five years, the accumulated cost of the rider on that same premium is meaningful. If you are confident you will not need annual liquidity — because you have separate accessible assets earmarked for near-term expenses — the rider’s cost reduces your net yield for no realized benefit. Our overview of annuities for conservative investors frames the liquidity planning question in broader terms: the right structure keeps enough accessible assets outside the annuity so that the protected accumulation core is never touched during the guarantee period.

The Enhanced Death Benefit Rider is the more important rider to evaluate for buyers with legacy planning priorities. In the base contract, the death benefit is the surrender value — which during the first years of a 5-year term can be significantly below the full account value due to surrender charges and a potential adverse MVA. A buyer who passes away in Year 2 of a 5-year contract with a $200,000 premium could have their beneficiaries receive considerably less than $200,000 plus two years of accrued interest if surrender charges and MVA apply. The Enhanced Death Benefit Rider eliminates that risk for 0.15% per year — the beneficiaries receive the full account value regardless of when death occurs. For buyers who are older, in declining health, or who have dependents counting on the full accumulated value as a legacy asset, the 0.15% annual cost of the death benefit rider is typically a straightforward value. Spousal continuation — which is standard and free — addresses a related but distinct scenario: a surviving spouse who wants to continue the annuity without triggering a distribution event, rather than claiming the death benefit.

The maximum useful rider combination is both riders, at a combined cost of 0.30% per year in declared rate reduction. Whether that combination is appropriate depends on the individual’s liquidity needs, age, health outlook, and legacy goals. For buyers who need neither the liquidity provision nor the enhanced death benefit on a given five-year commitment, the base contract with no riders delivers the highest net yield on the Security 5. Our independent comparison process evaluates the rate-adjusted illustration — base contract vs. with each rider vs. with both — alongside competing A-rated MYGA products from other carriers so you can see exactly where the Security 5’s net yield falls in the full competitive set before committing. The highest guaranteed annuity rates available today provides the real-time benchmark for that comparison.

MYGA Laddering: How the Security 5 Fits Into a Multi-Term Strategy

One of the most effective uses of MYGAs in retirement planning is a laddering strategy — allocating a pool of savings across multiple annuity terms so that a portion of the assets matures every few years rather than all at once. The Security series from Wichita National is particularly well-suited to laddering because the same carrier offers 3-, 5-, 7-, and 10-year terms with structurally identical mechanics, making cross-term comparison straightforward. Our dedicated resources on laddering annuities and the fixed annuity ladder strategy cover the full approach in depth; here is how the Security 5 typically fits within it.

A basic three-rung ladder using the Security series might allocate equal portions to the Security 3, Security 5, and Security 7. The Security 3 matures first, giving the buyer penalty-free access — or a renewal decision — at the three-year mark. The Security 5 matures two years later. The Security 7 matures two years after that. This rolling maturity structure means no more than two years pass without at least one tranche of assets reaching a penalty-free exit point. The practical benefit: the buyer never has to wait the full five or seven years to access any portion of the total allocation without a penalty, and each renewal window presents an opportunity to redeploy into whatever the current rate environment offers — whether that is another MYGA term, a fixed indexed annuity, or an income product. The broader framework for this approach — including how to phase into income from laddered MYGA maturities — is covered in our guide to laddering fixed annuities for retirement income.

One planning consideration specific to Wichita National is state availability — the Security series is licensed in a limited number of states. If you are using a laddering strategy that includes the Security 5 alongside products from other carriers, confirming that Wichita National is licensed in your state of residence is an essential first step. If it is not, the same five-year term at competitive rates is available from A-rated carriers whose products are available in all 50 states. Our independent process confirms state availability before presenting any illustration so that no time is wasted evaluating a product that cannot be issued in your state. The tax-deferred compounding that makes MYGA laddering powerful — each rung growing without annual taxation while accessible assets handle near-term income needs — is explained in full in our resource on how tax deferral creates compounding advantages over time.

Repositioning Assets Into the Security 5: Rollovers, Transfers, and 1035 Exchanges

Many buyers of the Security 5 are not funding it with new savings — they are repositioning assets from an existing qualified account, an old employer plan, or a legacy annuity that is no longer competitive. Getting those transfers done correctly protects the tax-advantaged status of the funds and avoids triggering unnecessary tax events. The process differs depending on the source of funds.

For IRA and qualified account transfers — including Traditional IRA, IRA Rollover, and SEP IRA — the correct mechanism is a direct trustee-to-trustee transfer. Our guide to transferring an IRA to an annuity covers the distinction between a direct transfer and a 60-day rollover, and why using the wrong approach can inadvertently trigger a taxable distribution event. For buyers moving funds from an employer-sponsored 401(k) or 403(b), transferring a 401(k) to an annuity involves additional employer plan rules — vesting schedules, outstanding loan balances, and plan distribution timing — that differ from a standard IRA transfer.

For non-qualified funds currently sitting in an older, lower-yielding annuity contract, a 1035 exchange allows the repositioning into the Security 5 without triggering a taxable event. The mechanics of a 1035 exchange require that both the sending and receiving contracts qualify under IRS rules — annuity-to-annuity exchanges generally qualify, but life insurance-to-annuity exchanges carry restrictions. Timing the 1035 exchange to land during the Security 5’s rate lock window — so that the rate you are quoted is the rate applied to the repositioned funds — is part of the application coordination our team manages on your behalf. Buyers who are repositioning from a CD at maturity have the simplest transfer path: funds are released at maturity, transferred directly, and funded into the Security 5 within the same calendar event. For those evaluating whether to exit a current annuity before its own surrender period ends, the calculation of break-even — comparing the Security 5’s higher rate against the surrendered carrier’s remaining charges — is part of our pre-application analysis.