MYGA vs CD | Living Benefits, LLC

What is MYGA and How is it different from CDs?

A MYGA (Multi-Year-Guaranteed-Annuity) is a type of fixed annuity. MYGAs guarantee a fixed interest rate for a set time period — usually two to 10 years. For the past decade, the multi-year guaranteed annuity has sat in the shadows because of low interest rates. But that has changed. Increased interest rates in recent years have allowed the MYGA to shine again, opening opportunities for risk-averse consumers to invest their money in a safe environment with decent rates of return. MYGAs are often compared to Certificates of Deposit (CDs). They both provide safety of principal and the entire principal remains unreduced by commissions. But there are quite a few differences. The chart lists them as well as similarities side by side.

Feature	MYGA	CD
Is it free from market risk and price flactuation?	YES	YES
Are interest earnings tax-deferred?	YES	NO
Is it a creditor-protected product?	YES (in many states)	NO
Does it automatically avoid probate upon owner's death?	YES	NO
Are pennalty-free withdrawals allowed?	YES (most companies)	NO
Does it offer guaranteed lifetime income?	YES	NO
Can withdrawals be made prior to age 59-1/2 without being subject to IRS pennalty?	NO	YES
Is it a "no-load" product?	YES	YES

FORM NAME: Ask Us A Question

First Name

Last Name

Phone Number

Question or Message

Text Paragraph

Your information will not be shared.

If you are a human, ignore this field

As you can see there are many advantages of Multi-Year-Guaranteed-Annuities. However, it is very important to review insurance company's ratings and financial strength before investing. Also, make sure to read the insurance contract entirely in order to understand your policy's provisions.

We work with many different insurance companies. Please contact us for the current MYGA crediting rates and see if it is the right product for you.

What is MYGA and How is it different from CDs?

Retirement Income Planning