The Annuity Truth
Straight Answer

What is a multi-year guaranteed annuity (MYGA)?

A single guaranteed rate for a set term — the annuity closest to a CD in feel.

Short Answer
A multi-year guaranteed annuity (MYGA) is a fixed annuity that guarantees a single interest rate for a specified multi-year term. It functions similarly to a CD in its certainty, but it is an insurance product — not FDIC insured — and its growth is tax-deferred. At the end of the term, you typically take the value, renew, or annuitize.

MYGAs are the simplest fixed annuity for someone who wants a known rate:

  • One guaranteed rate for the full term (e.g., 3, 5, or 7 years).
  • Tax-deferred growth.
  • Surrender charges if you withdraw beyond allowances during the term.
A MYGA differs from a traditional fixed annuity mainly in that the rate is guaranteed for the entire term rather than an initial period followed by a renewal rate.

Potential Advantages

  • A single, known rate for the full term.
  • Tax deferral.
  • No direct market exposure.

Tradeoffs and Limitations

  • No index-linked upside.
  • Liquidity limited during the term.
  • Guarantees depend on the issuing insurer, not FDIC.

Who Might Consider This

Those who want CD-like certainty for a multi-year period and value tax deferral, and who can leave the money in place for the term.

Questions to Ask Before Deciding

  • What is the guaranteed rate and term?
  • What are the surrender terms and free withdrawal allowance?
  • What happens at the end of the term?

Related Questions

Why do some financial advisors say annuities are bad?When might an annuity be the wrong choice?

Sources & References

Last updated: 2026-09-29This content is a draft pending qualified human review.
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Disclosures

The content on TheAnnuityTruth.com is educational and general in nature. It is not individualized investment, legal, or tax advice. Annuities are insurance products; product availability and features vary by carrier and jurisdiction, and guarantees are subject to the terms of the issuing insurance contract and the claims-paying ability of the issuing insurer. Annuity contracts are not FDIC insured, are not bank guaranteed, and are not a deposit or obligation of, or guaranteed by, any bank.