So you're looking for the best MYGA annuity rates? You can find the best MYGA rates at stantheannuityman.com. It has live feeds of the best MYGA fixed-rate annuity rates in the country. And you can filter it by your state of residence.
But with that short answer, that doesn't mean I’ve explained everything. So hold, hold, hold. I will go through a couple of things on MYGAs that you need to know to shop efficiently. I'm licensed in all 50 states, but I am the best educator out there on annuities because people have no idea what annuities are. Most people hate annuities, right? This is crazy because annuities are contracts. Getting down to what we are talking about today, MYGAs and CDs are virtually the same product. The MYGAs are the annuity industry's version of a CD, and they both have a guaranteed percentage that they pay for a specific period.
What makes one better than the other? Well, CDs are backed by the FDIC. State guarantee funds back MYGAs. In my opinion, FDIC is the best coverage because F stands for federal. F stands for; they’re going to tax you to get the money if they need it. In a non-IRA setting, the percentage grows tax-deferred. And that's what separates CDs from MYGAs. Inside of an IRA, it's the same thing. You're just going to get a guaranteed interest rate inside of an IRA. Any money coming out is taxed at ordinary income levels, so you're buying for the guarantee. But outside of an IRA in a non-qualified account, this percentage grows tax-deferred. Now that's fantastic. You do have to pay taxes when you take the money out. But a lot of people just want a guaranteed interest rate. They want no annual fees. They just want the best rate out there for the specific situation, and they don't want to pay taxes with their non-qualified money. MYGAs are the way to go.
Now, we will talk about how to look at MYGAs and possibly ladder a fixed-rate portfolio. So let's talk about a Fixed-rate portfolio. I have an example based on a client who called in the other day and had a lot of money. He had half a million dollars that he wanted to put into CDs or MYGAs; he couldn't decide which one. I don't sell CDs, but CDs are great products. Stan the Annuity Man, not Stan the CD Man. Anyways, nobody can get timed rates, correct? Nod your head. So in this example, and many others, the best thing to do is A, not lock in the long term, and B, ladder the portfolio. So we would go one year, two years, three years, four years, five years. That means you're going to have money maturing and coming due every year, starting at year one, which is good because then we can transfer to hopefully a higher rate.
Now, why did I put company B and company C? The reason is under the state guarantee fund limits; they back policies per company, per owner. So if you're with company A and company B and company C and within his state, there was a $250,000 limit on the state guarantee fund. Then all three of these were covered under the state guarantee fund. And then the two CDs were covered under FDIC, right? So what did I do? I said, hey, let's ladder the portfolio; we’re not going to time the rates. You then have protection with the FDIC on both CDs and state guarantee funds protection on the MYGAs. Plus, then you've laddered the portfolio where you have a guaranteed rate for all of these, but it's a combination CD and MYGA.
Reviewing MYGAs, you have to look for the best MYGA rates, and if you want to buy an MYGA, you can certainly use us to facilitate that. We'd love to have you as a client.
Never forget to live in reality, not the dream, with annuities and contractual guarantees! You can use our calculators, get all six of my books for free, and most importantly book a call with me so we can discuss what works best for your specific situation.