Best 5-Year Fixed Annuity Rates
The best 5-year fixed annuity rate today is 6.50% compounded from Ability, rated B+ by AM Best. $100,000 grows to $137,009 in five years.
Year 5 of 5. Guaranteed interest adds one layer a year.
Loading today's rates.
Change it and the stack rebuilds.
No 5-year contract matches these settings. Try a larger amount or a lower minimum rating.
Best 5 Year Annuity Rates
Among contracts sold in most states, Ability ReliAbility MYGA 5 builds the most on $100,000: $137,009 at 6.50% compounded. Rates updated November 14, 2026.
Compare 5-Year Annuities Side by Side
Up to three contracts, row by row. Choose Compare on any contract in the list above to swap it in.
Loading today's rates.
Rates and availability are updated from our carrier rate feed and can change without notice. Values assume no withdrawals and that the contract is held for the full term. Contracts marked simple interest credit interest on the original premium only. Guarantees are backed by the claims-paying ability of the issuing insurance company. Contracts marked "Not offered by MAS" are shown for comparison only.
Want one of these in writing?
A licensed agent will run the carrier illustration for your exact age, state and amount.
What Is a 5-Year Fixed Annuity (MYGA)?
A 5-year fixed annuity, also called a 5-year multi-year guaranteed annuity (MYGA), provides a guaranteed interest rate for a full five-year term. Your money earns a fixed rate each year, and the insurance company guarantees that rate will not change during the 5 years.
5-year fixed annuities work similarly to certificates of deposit (CDs), but they are issued by an insurance company, not a bank.
- Term. You agree to leave your money in the annuity for the full term.
- Rate. The insurance company credits a fixed interest rate that is locked in for all 5 years.
- Early withdrawals. Withdrawals above any free-withdrawal amount may be subject to surrender charges and possible tax penalties.
- Taxes. Interest grows tax-deferred, so you won't have to deal with a 1099 each year.
- Fees. My Annuity Store does not charge you a fee, and most MYGAs have no annual fees.
What Happens at the End of an Annuity Contract?
There is a 30-day window at the end of an annuity contract in which you will need to make a decision. If you do nothing, your annuity will renew for another term at whatever annuity rate is being offered at that time.
- Roll over. Move the funds into another annuity to continue tax-deferred growth, via a 1035 exchange.
- Start income. Roll over to an income annuity to secure a new income stream.
- Withdraw. Take the money out, systematically or as a lump sum.
Tax consequences vary with your contract and situation. Assess your options carefully and talk with an annuity specialist before the window closes.
What Affects 5-Year Fixed Annuity Rates?
5 year fixed annuity rates can vary based on several factors, including:
- State of residence. Not all products and rates are available in every state.
- Premium amount. Some carriers offer higher rates for larger deposit levels.
- Tax status and product. IRA vs non-qualified funds, and product features such as free withdrawal amounts, can influence the rate offered.
- Carrier pricing. Insurance companies adjust MYGA rates based on interest rates, portfolio yields, and their own business goals.
- Financial ratings. Companies with lower financial ratings usually have higher fixed annuity rates than companies with higher AM Best ratings2.
How to See the Most Accurate Fixed Annuity Rates
- Choose your state in the 5-year rate list to see contracts and rates available where you live.
- Enter your premium amount in the amount box at the top to view any rate breaks or deposit tiers.
- Review the details for each annuity, including surrender schedule, free-withdrawal provisions, and carrier rating.
Comparing Fixed Annuity Rates
When shopping for the best fixed annuity rate, look past the highest rate and consider all features of each annuity. The side by side comparison on this page puts them next to each other, and you can compare MYGA rates side by side for other terms.
- Carrier strength. Check the insurance company's financial ratings.
- Free withdrawal privileges. How much you can take out each year without a charge.
- Surrender charges. What it costs to take out more than that.
- Simple vs. compounding interest. How the rate is actually credited.
Simple vs. Compound Interest
The majority of MYGAs use compound interest. Knighthead Life's Staysail MYGA takes a more straightforward approach with simple interest.
Compare two five-year fixed annuities with an initial deposit of $100,000. The simple interest MYGA pays 5.95%, and the compound interest MYGA pays 5.35% annually. Both reach about the same value after five years, which makes the two rates close to equivalent.
| End of year | Simple interest, 5.95% | Compound interest, 5.35% |
|---|---|---|
| 1 | $105,950 | $105,350 |
| 2 | $111,900 | $110,986 |
| 3 | $117,850 | $116,924 |
| 4 | $123,800 | $123,179 |
| 5 | $129,750 | $129,770 |
The difference shows up if you take interest-only withdrawals each year for income.
| Interest withdrawn | Simple interest, 5.95% | Compound interest, 5.35% |
|---|---|---|
| Each year | $5,950 | $5,350 |
| Five-year total | $29,750 | $26,750 |
- Simple interest: $29,750 of income over five years.
- Compound interest: $26,750 of income over five years.
- Difference: about 11.2% more income from the simple interest MYGA.
Run your own numbers in the simple vs. compound interest calculator.
Free Withdrawal Options
Many 5 year fixed annuities allow you to withdraw the interest earned, or up to 10% of your account value annually, without penalty. Some have no free withdrawal option at all.
- Example. With $100,000 in your annuity and a 10% provision, you could withdraw up to $10,000 in year two without surrender charges.
- Trade-off. Annuities with no free withdrawal provision typically pay a higher guaranteed rate.
To rank only contracts that allow them, tick "Only show contracts with free withdrawals" in the rate list above.
Surrender Charges
A surrender charge is a fee applied by an insurance company5 when you withdraw money during the surrender period, which is the 5 years of the contract.
- How it is charged. As a percentage of your annuity's account value.
- How it changes. It is typically highest at the start and decreases over time.
- What it does. It reduces the total cash value you receive.
Fixed Annuities vs. CDs vs. Bonds
Fixed annuities, bonds, and CDs are all worth considering if you want a safe and steady way to grow retirement savings. Each offers predictable returns and safety of principal, but they differ in the details.
| Feature | 5 Year Fixed Annuity | 5 Year Bank CD |
|---|---|---|
| Current Rates | Up to 6.50% compounded | 3.50% to 4.50% |
| Tax Treatment | Tax-deferred growth | Taxed annually on interest |
| FDIC/State Protection | State guaranty association | FDIC insured up to $250K4 |
| Early Withdrawal | Surrender charges apply | Penalty (typically 3-6 months interest) |
| Best For | Long-term savers, retirement funds | Emergency funds, short-term goals |
- Choose a fixed annuity for a higher rate, tax-deferred growth and no annual 1099.
- Choose a CD if you need FDIC insurance specifically, want maximum liquidity, or are uncomfortable with an insurance company backing the contract.
- Choose bonds if you want government backing, need to sell before maturity, or are building a bond ladder.
To see what a rate is worth on your amount, use the MYGA calculator.
Fixed Annuity Pros and Cons
Potential pros
- Guaranteed contract rates
- Tax-deferred growth where applicable
- Principal protection, subject to insurer guarantees and contract terms
- Potential 1035 exchanges
- Relatively straightforward product structure
- Withdrawal options, depending on the contract
- Accessible minimum premiums on some products
- Death benefits specific to each contract
Potential cons
- Potential 10% additional federal tax on taxable distributions before age 59½, subject to exceptions
- Surrender charges
- Possible market value adjustments
- Limited liquidity
- No direct stock-market participation in a traditional fixed annuity
- Inflation risk
- Income limitations specific to each product
Free Annuity Quote
Tell us a little about your plans. A licensed annuity specialist will follow up with 5-year rates that fit your state and amount. No obligation.
Request received. Thanks. A licensed annuity specialist will contact you about 5-year options for your state within one business day. Check your inbox for confirmation.
We use your information to respond to this request and will never sell it. See our privacy policy for details. Submitting does not sign you up for marketing.
Best Annuity Rates by Term
If five years is not the right fit, each guarantee period has its own rate page.
- 5.25%2-year rates
- 6.50%3-year rates
- 6.05%4-year rates
- 6.20%6-year rates
- 7.65%7-year rates
- 6.20%8-year rates
- 6.20%9-year rates
- 6.35%10-year rates
Each figure is the highest guaranteed rate we track for that term on $100,000. For every term in one table, see all fixed annuity rates, then weigh them against the best 5-year fixed annuity rates above.
Frequently Asked Questions
What is the best 5-year annuity rate?
The best 5-year fixed annuity rate today is 6.50% compounded from Ability, rated B+ by AM Best. $100,000 grows to $137,009 in five years. Some contracts quote a higher number: 7.15% simple interest from Knighthead, sold in California only. Rates vary by state, premium and availability, so compare the full fixed annuity rate table before you apply.
What is a 5-year annuity?
Usually a multi-year guaranteed annuity (MYGA) that credits one fixed rate for 5 years, with a surrender schedule over the same period. At the end of the term you can typically renew, move the money through a 1035 exchange, annuitize, or withdraw. Our guide to what happens when an annuity matures walks through each option.
How do I buy an annuity at My Annuity Store?
It takes three steps. First, compare guaranteed rates, terms and insurer ratings on this page, or request a quote. Second, talk with a licensed annuity specialist about your goals, your state's availability and the contract terms, with no obligation. Third, if you choose a product, we help you complete the insurer's annuity application and fund the contract.
How does My Annuity Store get paid?
The insurance company pays us a commission after a contract is issued. It is built into the product's pricing rather than deducted from your premium, so the rate you see is the rate the carrier credits. Our process explains every step.
Do you charge any fees?
No. You pay no fees and no commissions to us. Annuity contracts can carry their own costs: surrender charges for early withdrawals, possible market value adjustments, and charges for optional riders. Each contract's disclosure lists them.
Are annuities FDIC insured?
No. Annuities are issued by insurance companies, not banks, and are not FDIC insured. Guarantees depend on the issuing insurer's financial strength and claims-paying ability. Your state guaranty association provides limited protection if an insurer fails, and limits vary by state.
Do you sell my information?
No. We never sell your information. We use what you send us to prepare your quote and follow up, as described in our privacy policy.
Written by Jason Caudill, MBA, Founder, My Annuity Store
Jason founded My Annuity Store in 2020 to help people compare annuities from many insurers and buy with full information. He brings more than 20 years of annuity industry experience and works with clients on MYGAs, income annuities, and fixed index annuities.
Reviewed by Bill Cardwell, CFP®.
