What is a MYGA?

Multi-Year Guaranteed Annuities (MYGAs) are a simple and safe way to grow your money for a predetermined length of time. You deposit a lump sum of money, then an insurance company holds your money and credits your account with a guaranteed interest rate for the entire term of the contract.

Who should consider getting a MYGA?

  • People who want a better return on their money than a bank can provide
  • People who won't need the money they deposit for a few years
  • People who want to make sure their money and interest will definitely be there at the end of the guaranteed term
  • People who want to set aside money for a specific future purpose 
  • People who hate losing money
  • People who are skeptical of the stock market or the economy

More Information about MYGAs

In many ways, a MYGA works like the Certificates of Deposit (CDs) that are offered by banks and credit unions. A MYGA is a safe way (backed by insurance companies instead of banks) to grow your money at a safe rate for a specific length of time. MYGAs generally offer better rates than CDs can provide, but like CDs, there can be penalties for early withdrawal. MYGAs are also generally purchased with a single payment, though a few of them will allow a person to add more money to their account at a later point if certain criteria are met. MYGAs allow you to lock in current interest rates, so if rates go down your money can continue to earn the previous amount. It should also be noted that if rates go up, your money may already be committed. Most MYGAs will allow you to withdraw a portion of your money early without penalty. This amount can be anywhere from 2% of the account value all the way up to 20%. If you think you might need to use some of the money in your MYGA account before the end of the term, please mention this to us so we can make sure our recommendations align with your thoughts and goals.

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