5 Year Guaranteed 3.45% Return. What Am I Missing Here???

  |     |   7 posts since 2016

Like most of you, I sleep well at night knowing that my cash is safe and sound in deposit accounts, most of which were opened a couple of years ago in some great CD's thanks to Ken and the Deposit Accounts site (Loving my GTE add-on CD's). But pretty soon I will have some maturing accounts that will need to be moved to something new.... So here's my question; what is the downside to investing some of my cash in MYGA's or Multi Year Fixed Annuities. I follow what's happening with these annuities in my state of New York at immediateannuities.com, and right right now, a 5 year MYGA from A++ rated Mass Mutual or A+++ rated New York Life earn between 3.20% & 3.45% interest.

What am I missing here? I understand that insurers insuring themselves is not the same as FDIC, but these companies are A++ rated. Not shabby Institutions.

I would appreciate some input if possible, specifically I'm interested in the "Mass Mutual Stable Voyage 5 (MVA).


  |     |   42 posts since 2022
You will probably see close to 3.5% 5 yr CDs in a few months if the feds keep going.
  |     |   409 posts since 2020
Well all things being equal I still prefer bank CD's over Annuities but if you are going to get an annuity the MYGA's are definitely the way to go. I call them CD type annuities. Still look very carefully at the fine print and see if there are any fees or loads and what the surrender charges are if any. There are so many insurance companies and their rules may vary. Also just like CD's I would wait until we are near the end of this rate hike cycle to lock in long term as in 5 years or longer. Also make sure it's a better rate than what the banks are paying for dealing with the extra fine print and no FDIC coverage. I'm not knocking them either they can be a good choice depending on the rate and terms just be careful and read all the fine print.
  |     |   659 posts since 2020
See how the interest rate is calculated in the future …several years ago…an insurer wanted to rely upon what was in the policy cover letter to disclose its practices…which was not part of the annuity contract…we went around and they finally came around. The other unrelated aspect was (years ago) was the literature reflected one should only do business with issuers qualified in NY. Good luck!

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