What is a MYGA?
A MYGA, or multi-year guaranteed annuity, is a fixed annuity from an insurance company that pays a guaranteed interest rate for a set number of years, often 3 to 10. It works much like a CD, but it is an insurance contract, not a bank deposit.
Interest grows tax-deferred. At the end of the term you can usually withdraw, renew, or move the money. Withdrawals above the free amount during the term may incur surrender charges and market value adjustments, and withdrawals before age 59½ may face a 10% IRS penalty.
See best 5-year MYGA rates or compare MYGA vs CD.
Frequently asked questions
How does a MYGA work?
You put in a single amount, the insurer guarantees a fixed rate for the term, and interest compounds tax-deferred. At the end of the term you choose what to do next.
What is the minimum for a MYGA?
Minimums vary by insurer and product, often from $5,000 to $100,000.
Are MYGAs safe?
A MYGA is backed by the financial strength and claims-paying ability of the issuing insurance company, not the FDIC. That is why we show each insurer's AM Best financial strength rating. Every state also runs a life and health insurance guaranty association that provides limited protection, with limits that vary by state.
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