Hurry: Lock in the Interest Before It Goes Away
“The end of the Federal Reserve’s campaign to raise interest rates is approaching, according to Morgan Stanley strategist Michael Wilson.” Bill Broich
Example of what is currently available:
5-year guaranteed interest of 5.2% or higher
3- year Guaranteed interest of 4.5% or higher (subject to change and state approval)
Multi Year Guaranteed Annuities (MYGA) are hot! The reason? Thanks to the current attitude of the Federal Reserve, interest rates are well above any Safe Money guaranteed product.
- Tax-free interest earned for the duration of the three or five-year contracts
- Penalty-free withdrawals of interest earned throughout the contract
- MYGAs are free from market risk
Like most people, you are always looking for ways to make your money work harder. With a MYGA, you can do just that. This type of annuity offers safety, security, and guaranteed growth. A MYGA is an excellent option for those looking for a safe investment. With this type of annuity, you are guaranteed a fixed interest rate for a set period. Multiple-year periods are available, from 2 years to 10, all with guaranteed interest rates for the entire period. If you are looking for a safe and secure investment that also offers growth potential, then the MYGA is an excellent option. Grab the interest while it is still available and make your money work harder.
When you purchase a MYGA, you agree to leave your money untouched for a set period, typically 2 to 10 years. The longer you agree to keep the funds on deposit, the more likely you will earn a higher interest rate.
What is the Difference Between MYGAs and CDs?
- A CD is issued by a bank, financial institution, or broker; a MYGA is a contract with an insurance company.
- MYGAs are insured by the financial strength of the insurance company issuing the annuity. A CD is FDIC-insured.
- A CD usually penalizes a depositor if they access the funds in a CD before the maturity date. Many MYGA products allow some access to your funds without a penalty. The allowable percentage is usually 5% to 10% of the account value annually.
- The taxation is different; a Bank CD’s earned interest is taxed even if it is left on deposit. A MYGA offers tax-deferred growth.
You could use a MYGA as a substitute for a CD or incorporate both into your financial plan.
Safety, Security, and Market Risk-Free