Best MYGA (Multi Year Guaranteed Annuities) Thread 2024 - Please post updates here.

[ShokWaveRider]

When choosing a 5, 4 or 3 year MYGA, should one really be concerned whether they are rated A, A+ or A++? Is there a meaningful difference for these contract periods?

 

[Al18]

There’s an informative and funny video made by Stan the Annuity Man Link

 

[pb4uski]

The difference in credit risk between A++, A+ or A over 5 years is probably negligible. Besides, if the company goes sideways and you're quick enough you can always withdraw everything and pay the surrender charge and limit the bleeding.

 

[ShokWaveRider]

There are some pretty good rates with A++ Companies at the moment. Mass Mutual being one. They allow penalty free withdrawals of 10% Per year and honor RMD withdrawals. Withdrawals can also be set up to pay periodically (Monthly Maybe). Seems like a good deal to me. If one has ~$1m in Laddered MYGAs it could provide a reasonable income.

 

[VanWinkle]

Recently did 3,4,and 5 year MYGA ladder with all of the companies being
A- and above. The rates were comparable with the B rated companies
so the choice was easy.

 

[jazz4cash]

The difference in credit risk between A++, A+ or A over 5 years is probably negligible. Besides, if the company goes sideways and you're quick enough you can always withdraw everything and pay the surrender charge and limit the bleeding.

I agree that the difference is negligible but I think being insurance companies the issuers move at a glacial pace compared to brokers. I would not count on them being very responsive. I only have experience with A rated Americo but it seems like they move at their own pace and follow up calls are routine. I still like MYGAs and I would be OK with a B+ rating.

 

[ShokWaveRider]

Mass Mutual has a great 5 Year MYGA available at the moment. They are A++ rated.

Voyager Plus - 5.55% Annual Rate​

• 5 Years Surrender Fee Period (Duration).
• Tax-Deferred, Compound Interest
• No Stock Market Exposure
• Penalty Free Withdrawals Available
• No Loads, Fees, or Sales Charges

 

[jazz4cash]

I never realized how much MYGA rates vary based on state of residence. On Blueprint Income a 5yr rate of 6.3% is available in Nevada but next door in CA the max is 5.5.

 

[GenXguy]

Also see this thread, some good posts there:

MYGA

I'm an experienced investor but a COMPLETE newbie with MYGAs. Picture someone who's been vacationing in hotels suddenly deciding to get a timeshare...that level of "stuff to learn". I'm realizing that MYGA's are offering superior rates further out, like 5 years plus. I've never bought one...

www.early-retirement.org

 

[teej1985]

If you're sub 59.5, I find the Gainbridge FastBreak product super interesting - not sure why nobody else offers something similar. Solid rate, too. Gainbridge: A better way to grow your money.

 

[hotwired]

Also see this thread, some good posts there:

MYGA

I'm an experienced investor but a COMPLETE newbie with MYGAs. Picture someone who's been vacationing in hotels suddenly deciding to get a timeshare...that level of "stuff to learn". I'm realizing that MYGA's are offering superior rates further out, like 5 years plus. I've never bought one...

www.early-retirement.org

Hey that's me, haha! I've learned a bit since that post, but still digging in...

 

[GenXguy]

Well, I'm attempting to do my first MYGA so that I can earn some decent interest income and delay taxable interest for several years.

I missed the Mass Mutual A++ 5.55% 5 year MYGA annuity mentioned above, so I worked with immediateannuities.com to get an Oceanview (A rating) 5.85% 6 year MGYA instead, for $100,000.

Oceanview Harbourview MYGA 6 Annuity — ImmediateAnnuities.com

This page describes the Harbourview MYGA 6 annuity sold by the Oceanview Life and Annuity Company.

www.immediateannuities.com

In the Oceanview document available online, it lists settlement options:

Life Only; Life with 10-Year Period Certain; Joint and Last Survivor with 10-Year Period Certain (If Annuitized)".

I called backed inquiring about that limitation, and he said that when my MYGA reaches 6 years, I can annuitize it through a different company for a fixed period like 5 years using a 1035 exchange (tax free transfer) and am not bound to the Lifetime options mentioned in the Oceanview document. An online document I had read said that not all annuities had all options such as fixed time period payouts and that you need to check the annuity you're considering purchasing. But apparently, it doesn't really matter since you can exchange out for a completely different company's product to annuitize with more options.

What I didn't expect is that they said I need to send a check. They don't do ACH. So I'm having to pull the money via ACH using Vanguard to withdraw from NFCU checking because NFCU only allows you to push an ACH of up to $5,000 per day day. And then I will have to do an ACH push from Vanguard to my personal local checking account so that I have the funds to write check for the Oceanview MYGA. My local checking is setup to pull with ACH from NFCU, but the local account has a limit of $1,000. I tried. Vanguard says they have a 7 day hold on ACH, and then I have the second step to push to the local checking account.

So, I'm concerned about the extra delay between transfers and hold times before I can actually get the funds into my local checking so that I can write a check. Some MYGA rates have dropped in the last few days and more are about to drop, so I hate to miss out on the higher rate. Does this sound like a valid concern for getting the MYGA started at the current rate?

 

[Al18]

Can you send an official bank check from NFCU to the annuity company? You probably want to send this via overnight, registered mail. Check with NFCU.

 

[GenXguy]

Can you send an official bank check from NFCU to the annuity company? You probably want to send this via overnight, registered mail. Check with NFCU.

NFCU has an option to get a cashier's check, but the only option is branch pickup if it's over $2500, possibly for all checks to a third party, which isn't an option for me. I decided to just do the ACH transfer to Vanguard. I thought it wouldn't be over 3 days, but after doing it, I read about the 7 day hold. So, it's already in motion - I did that before posting about it earlier. And then I'll have to transfer to my local checking. I'm just not sure what problem the delay might cause for locking in my interest rate. I'll be following up with immediateannuities.com.

 

[jazz4cash]

That sounds awkward. I didn’t see any option for return of principal + interest at maturity. One of the things I like about MYGAs is they generally lock the rate at the time of application. Also, you get 30 days or more to fund the purchase at the locked rate. THEN you get 30 days or more to cancel (if rates have jumped). Blueprint income does a good job presenting the details for the products they offer. They do offer Oceanview so you should be able to see the details there. I am assuming that most details would be the same even if you use a different broker.

So, I'm concerned about the extra delay between transfers and hold times before I can actually get the funds into my local checking so that I can write a check. Some MYGA rates have dropped in the last few days and more are about to drop, so I hate to miss out on the higher rate. Does this sound like a valid concern for getting the MYGA started at the current rate?

 

[GenXguy]

That sounds awkward. I didn’t see any option for return of principal + interest at maturity. One of the things I like about MYGAs is they generally lock the rate at the time of application. Also, you get 30 days or more to fund the purchase at the locked rate. THEN you get 30 days or more to cancel (if rates have jumped). Blueprint income does a good job presenting the details for the products they offer. They do offer Oceanview so you should be able to see the details there. I am assuming that most details would be the same even if you use a different broker.

OK, thanks, well 30 days should be more than enough to get the $100K into my local checking. I haven't even electronically signed the application because of an error in a beneficiary's name.

Blueprint just linked back to the Oceanview website, but I did check out the Oceanview website regarding the Harbourview MYGA.

As far as the return of principal + interest at maturity, that's related to the maturity options I was addressing in part of my earlier post. It does say on the brochure:

At the end of the Guarantee Period, you will be notified that the contract can be surrendered, transfered, or renewed for another Guarantee Period for the then current renewal rates.

And on the Oceanview website, for Contract Renewal Process, it says:

30 Days Prior to the end of the Contract’s Interest Rate Guaranteed Period, the Agent and Policy Holder will be alerted to the following options:

Surrender Contract (not subject to surrender charges or MVA). If client does not make an election, the Contract renews for the same Guarantee Surrender Charge Period at the declared new money rate (never less than 1%).

Apply for a new Contract Guarantee Period of choice with the declared new money rate with a corresponding new Surrender Charge Period.

Take a partial withdrawal (not subject to surrender charges or MVA), and renew the remaining value to the same Guarantee Period or apply to another Guarantee Period.

1035 Exchange Full or Partial account value

Spousal Continuation <snip>

And the guy from immediateannuities told me you could do a 1035 exchange to another company's annuity for an annuitized payout over 5 years, for example, which is more likely what I would want to do, not a lifetime payout. He said I wouldn't want to leave it at Oceanview at maturity because it wouldn't pay as well.

Edit: Actually Blueprint does have some additional info on their website along the left side when viewing details of the MYGA, including this:

You will have a 30 day window leading up to maturity to withdraw the money invested, reinvest it in another fixed annuity, or turn it into guaranteed income via annuitization.

 

[ShokWaveRider]

I am not interested in long term tax deferral anymore. At the end of my MYGA contracts I will just withdraw the cash and look for someplace else to park it. I do take advantage of their 10% per year free withdrawals too, saves me taking money from my IRA stash. I use them just like a bank CD. Invest under $250k so it is covered by my states guarantee fund. I have an Oceanview MYGA and it has been fine. I ACH the funds from Schwab to My CU, then send the check FedEx using Blueprint's provided FedEx envelope. All done in less than a week, no complaints here.

 

[GenXguy]

One thing on the application says

We deduct premium taxes, if applicable, imposed on us by a federal, state, local, or other government agency. Some states collect these taxes on premium payments; others collect at the time of Annuitization. Since we pay premium taxes when they are required by applicable law, we may deduct them from your contract when we pay the taxes, when you withdraw your contract value, when you start to receive income payments or when it pays a death benefit to your beneficiary. The premium tax rate varies by state or municipality, and currently ranges from 0 - 3.5%

I couldn't find anything indicating there was a premium tax on annuities in Illinois, neither at purchase or annuitization. Actually, I don't recall annuity premium taxes being mentioned before.

Edit: agent called back and confirmed there is no annuity premium fee for Illinois.

 

[jazz4cash]

Blueprint just linked back to the Oceanview website, but I did check out the Oceanview website regarding the Harbourview MYGA.


Edit: Actually Blueprint does have some additional info on their website along the left side when viewing details of the MYGA, including this:

Yeah, I use that Blueprint “Details” page all the time so you had me scratching my head! The link to the insurer is frequently their brochure/marketing page but Blueprint lists details in a consistent format across all their providers. They even show their commission. I did note a wrinkle on the mobile site that there is an “Additional Details” dropdown option to get to the rate lock, banding, days to fund, etc.

Heck some of those rates look pretty juicy but I think I’m done with MYGAs for now.

 

[GenXguy]

Yeah, I use that Blueprint “Details” page all the time so you had me scratching my head! The link to the insurer is frequently their brochure/marketing page but Blueprint lists details in a consistent format across all their providers. They even show their commission. I did note a wrinkle on the mobile site that there is an “Additional Details” dropdown option to get to the rate lock, banding, days to fund, etc.

Heck some of those rates look pretty juicy but I think I’m done with MYGAs for now.

Yeah, I clicked the brochure right away the first time instead of scrolling down where the other details were visible (Windows PC).

immediateannuities.com & stantheannuityman showed 5.85% while blueprint showed 5.70% for the 6 year Oceanview Harbourview MGYA. I went with immediateannuities.

The agent confirmed that I could withdraw principal + interest at maturity as well. And no premium tax for Illinois.

 

[jazz4cash]

Yeah, I clicked the brochure right away the first time instead of scrolling down where the other details were visible (Windows PC).

immediateannuities.com & stantheannuityman showed 5.85% while blueprint showed 5.70% for the 6 year Oceanview Harbourview MGYA. I went with immediateannuities.

That’s a significant difference. Could it be a difference between withdrawal pilicy? I was planning to use immediatannuities.com but then Blueprint came along and I went with them. I have not noticed any vsriation between brokers but can’t say I really looked. I would ask them to match if I was interested. Also, Blueprint was acquired by Mass Mutual so I’ve been curious to see if they favor the parent company’s peoducts.

Reply function acting odd.

 

[GenXguy]

That’s a significant difference. Could it be a difference between withdrawal pilicy? I was planning to use immediatannuities.com but then Blueprint came along and I went with them. I have not noticed any vsriation between brokers but can’t say I really looked. I would ask them to match if I was interested. Also, Blueprint was acquired by Mass Mutual so I’ve been curious to see if they favor the parent company’s peoducts.

Reply function acting odd.

It looks like the withdraw policies allow for all the usual options. It appears the rate set date may be the difference. I think immediateannuities said the rate would be 5.7% on the 21st. Stan annuity man shows rate was set on April 22. Blueprint says rate was set on May 16. So, on May 22, they may all match at 5.7%.