Best 5-Year Fixed Annuity Rates for August 2026
The top 5-year fixed annuity rate today is 6.80% APY, compared with roughly 4.65% for a comparable bank CD. A $200,000 deposit locked in at that rate for five years grows to about $271,000, and the interest compounds tax-deferred1 until you take it out.
Use the live rate table below to filter by state, premium amount, and A.M. Best rating. Rates refresh every 30 minutes through our Annuity Rate Watch data feed2. Want a personalized quote? Call 855-277-8088 or request a quote online.
Key Takeaways
- Top 5-year MYGA rate: 6.80%, vs. roughly 4.65% for a comparable bank CD, and the growth is tax-deferred.
- For example, at 6.30% a $200,000 investment compounds to approximately $271,000 over 5 years.
- Most 5-year MYGAs allow 10% annual free withdrawals after year one, no surrender charge.
- At maturity, you can renew, 1035 exchange, or take a lump sum, no forced decision.
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. For a comparison across all term lengths, see our main fixed annuity rates page, or jump directly to 3-year MYGA rates or 7-year MYGA rates. 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.
My Annuity Store does not charge a fee, and none of the annuities we offer charge a fee; unless you withdraw your funds early, in which case you may be assessed a surrender charge.
- You agree to leave your money in the annuity for the full term
- The insurance company credits a fixed interest rate that is locked-in for all 5 years
- Early withdrawals above any free-withdrawal amount may be subject to surrender charges and possible tax penalties
- Interest you earn in a fixed annuity grows tax-deferred, so you won’t have to deal with a 1099 each year
What Happens at the End of an Annuity Contract?
It is important to note that 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. You will have several options at the end of your annuity contract, and we’ve listed them below.
- You can rollover the funds into another annuity to continue tax-deferred growth (via a 1035 exchange).
- You can rollover to an income annuity to secure a new income stream.
- You can also initiate withdrawals, systematically or as a lump sum.
You should be aware of possible tax implications. Tax considerations and potential ramifications will vary based on your annuity contract and situation. My Annuity Store recommends you carefully assess your options and consult an annuity specialist to align your decision with your financial objectives.
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 specific MYGA 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.
- Insurance Company Financial Ratings – Companies with lower financial ratings usually have higher fixed annuity rates than companies with higher AM Best ratings3.
How to See the Most Accurate Fixed Annuity Rates
For the most accurate and relevant 5-year fixed annuity (MYGA) rates for your situation:
- Filter rates by your state of residence to see products and rates available where you live.
- Enter your desired premium amount to view any rate breaks or deposit tiers.
- Review product details for each annuity, including surrender schedule, free-withdrawal provisions, and carrier rating.
If you’d like help comparing options or confirming your exact rate before you apply, call us at 855-277-8088 or request a personalized quote.
Best 5 Year Annuities by Category
Compare the annuities with the best 5 year fixed annuity rate overall, the best rate with liquidity, and the best rate for a company rated A- or higher.
| Compare | Best Rate Anchor MYGA 5 American Gulf • AM Best: B++ |
Best for Liquidity Mountain Life Alpine Horizon • AM Best: B |
Best A- Rated+ Waypoint 5 MYGA Axonic Insurance Services • AM Best: A- |
|---|---|---|---|
| Annuity rate | 6.30% | 6.15% | 5.70% |
| Free withdrawals | After year 1: 0% free / year | After year 1: 5% free / year | After year 1: 10% free / year |
| AM Best rating | B++ | B | A- |
| Term | 5 years | 5 years | 5 years |
| Minimum investment | $10,000 | $5,000 | $100,000 |
| Brochure | Brochure | Brochure | Brochure |
| Next step | Get a quote Call |
Get a quote Call |
Get a quote Call |
Disclosure: Rates, withdrawal provisions, and carrier ratings are subject to change and may vary by state and issue age.
This table is for educational comparison only and is not a guarantee of availability or approval. Confirm all details before purchase.
Get a Free, Personalized Annuity Quote
Compare rates from 90+ top annuity companies. No obligation, no cost.
We respect your privacy. Your information is never sold.
Comparing Fixed Annuity Rates
When shopping for the best fixed annuity rate, it is important to look past the highest rate and consider all features of each annuity.
Key Features to Consider:
- Insurance Company’s financial ratings
- Free withdrawal privileges
- Surrender charges
- Simple vs. compounding interest
Simple vs Compound Interest
When evaluating the best 5 year fixed annuity rates, you will likely see that the majority of MYGAs, or multi-year guarantee annuities, offered by insurance companies use compound interest. Knighthead Life’s Staysail MYGA takes a more straightforward approach with simple interest.
Let’s compare two five-year fixed annuities with an initial deposit of $100,000.
The simple interest MYGA pays a rate of 5.95%, and compound interest MYGA pays a crediting rate of 5.35% annually. As you can see from the table of values below, both individuals have the same accumulated value after five years, making the products rate-equivalent.
The Difference: Income
What if you’d like to use your MYGA for income purposes and take interest-only withdrawals annually to cover certain living expenses? See how the compound and simple interest MYGAs compare over five years of annual, interest-only withdrawals. Use our simple vs. compound interest calculator
The simple interest option generates $29,750 versus the compound interest total of $26,734. That’s 11.5% more income. When it comes to income, the simple interest MYGA provides more value.
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. While some fixed annuities have no free withdrawal options. Example: If you have $100,000 in your annuity, you could withdraw up to $10,000 in year two without facing surrender charges.
If you do not want or need any free withdrawal options, it may be wise to consider annuities with no free withdrawal provisions because they typically pay a higher guaranteed rate.
Surrender Charges
A surrender charge is a fee applied by an insurance company4 when you withdraw money from an annuity during the “surrender period,” which is during the 5 year annuity contract.
Surrender charges are applied as a percentage of your annuity’s account value and decrease over time.
They reduce the total cash value you receive and are typically highest at the start, often becoming zero after 7-8 years, with some contracts allowing small penalty-free withdrawals annually.
Fixed Annuities vs. CDs vs. Bonds
Fixed annuities, bonds, and CDs are all worth considering if you are looking for a safe and steady way to grow your retirement savings. They each offer predictable returns and safety of principal, but there are differences among them.
The table below compares and contrasts the differences.
| Feature | 5 Year Fixed Annuity | 5 Year Bank CD |
|---|---|---|
| Current Rates | 5.50% - 6.30% | 3.50% - 4.50% |
| Tax Treatment | Tax-deferred growth | Taxed annually on interest |
| FDIC/State Protection | State guaranty association* | FDIC insured up to $250K |
| Early Withdrawal | Surrender charges apply** | Penalty (typically 3-6 months interest) |
| Best For | Long-term savers, retirement funds | Emergency funds, short-term goals |
Fixed Annuity Advantages:
- Higher rates: 1.5-2% more than CDs
- Tax-deferred growth: Pay taxes only when you withdraw
- No annual 1099s: Unlike CDs and bonds
- Competitive with bonds: Without interest rate risk
When to Choose CDs Instead:
- Need FDIC insurance specifically5
- Want maximum liquidity
- Uncomfortable with the insurance company backing annuities
When to Choose Bonds Instead:
- Want government backing
- Need to sell before maturity (secondary market)
- Building a bond ladder
2026 Annuity Rate Trends
What’s Happening Now: The Fed began cutting rates in late 2024. While annuity rates have held strong, they’re starting to edge downward. 2026 Outlook: Most projections show continued Fed rate cuts. Waiting could mean locking in rates 1-1.5% lower than today. Bottom Line: Today’s rates remain historically attractive. If a rate meets your goals, locking in now beats gambling on a downward trend. When analyzing your options, the best 5 year fixed annuity rates should be at the forefront of your considerations.
Who Should Consider a 5 Year Fixed Annuity?
A 5-year fixed annuity isn’t right for everyone. Here’s who benefits most from these products.
Pre-retirees in their 50s and early 60s who want to protect a portion of their retirement savings from market volatility while earning guaranteed returns. If you’re five to ten years from retirement, you don’t have time to recover from a major market crash. Putting some of your portfolio in a 5 year fixed annuity creates a safety net.
Recent retirees who need to preserve capital while earning more than savings accounts offer. If you’ve just retired with a lump sum from a 401(k) rollover, placing a portion in a 5 year guaranteed annuity ensures that money will be there when you need it, grown by a predictable amount.
Conservative investors who lose sleep over market fluctuations. If checking your investment balance during market downturns causes anxiety, fixed annuities offer peace of mind. The guaranteed rate means you never see a negative return, which is psychologically valuable for risk-averse individuals.
People with large cash positions exceeding FDIC insurance limits who want safe alternatives to spreading money across multiple banks. If you have $500,000 in cash, you could put $250,000 in FDIC-insured accounts and $250,000 in highly-rated fixed annuities for similar safety with potentially better returns.
Those seeking CD alternatives who want higher rates and tax deferral. If you’re already comfortable with CDs, fixed annuities are a natural next step, offering better returns in exchange for similar commitment.
On the flip side, 5-year fixed annuities probably aren’t right for you if you’re young with decades until retirement (you can afford more market risk for higher returns), if you might need the money before five years (liquidity is limited), or if you’re comfortable with market volatility and want maximum growth potential.
5-Year Fixed Annuity vs. 5-Year CD: Which Pays More?
The most common alternative to a 5-year MYGA is a 5-year bank CD. Both lock in a rate for five years. But they are taxed differently, insured differently, and pay differently – and right now the rate gap is unusually wide.
| Feature | 5-Year MYGA | 5-Year Bank CD |
|---|---|---|
| Current top rate (August 2026) | 6.80% | 4.65% |
| Rate advantage | Higher per year | – |
| Annual tax on interest | No (tax-deferred) | Yes (1099-INT every year) |
| FDIC insured | No (state guaranty association) | Yes (up to $250,000) |
| IRS early withdrawal penalty | 10% on gains if under age 59½ | None |
| Contribution limit | None | None |
| Free partial withdrawals | Typically 10% per year | Usually none |
| At maturity options | Withdraw, renew, 1035 exchange, annuitize | Withdraw or renew |
On a $100,000 deposit, the after-tax difference is significant. At the 24% bracket, a 5-year CD at 4.65% grows to roughly $122,400 after taxes. A 5-year MYGA at 6.30% grows to approximately $135,970 gross – after paying taxes on the $35,970 gain at withdrawal, you keep about $125,161. That’s $2,700 more in your pocket, and the gap widens at higher tax brackets or larger deposits.
The CD makes more sense if you are under 59½ (the IRS 10% penalty eliminates the MYGA’s advantage) or if you need absolute FDIC certainty on amounts under $250,000. For everyone else, the math generally favors the MYGA.
What $200,000 in a 5-Year Fixed Annuity Actually Looks Like
Concrete numbers make this easier. Robert is 64, recently retired, and has $200,000 sitting in a savings account earning 4.3%. He is in the 22% federal tax bracket and does not need this money for at least five years.
Option A – Keep it in the savings account at 4.3%:
- Annual interest: $8,600, taxed at 22% = $6,708 net per year
- After 5 years (net, after annual taxes): approximately $233,500
Option B – 5-year MYGA at 6.30%:
- Annual interest compounds tax-deferred – no 1099 each year
- Balance after 5 years: $270,700
- Taxes owed at withdrawal on $70,700 gain (22%): $15,554
- After-tax value: $255,146
Robert keeps $21,646 more with the MYGA. He also has the option to roll it into a new annuity via 1035 exchange at maturity – continuing to defer taxes – rather than taking a taxable lump sum.
How Do 5-Year MYGA Rates Compare to Fidelity Fixed Annuities?
Fidelity offers fixed deferred annuities through its platform, displaying rates from several major carriers. Their available rates are competitive but come from a curated set of insurers Fidelity has vetted and chosen to feature – not the full independent market.
As of August 2026, Fidelity’s 5-year fixed annuity offerings typically range from 5.00% to 5.65% from carriers like MassMutual, New York Life, and Western National. Those are solid rates from highly-rated companies.
The difference: independent brokerages like My Annuity Store access the full independent market – including carriers like Midland National, Athene, American Equity, and others that consistently appear at the top of rate comparisons but do not distribute through Fidelity’s platform. That is how independent agents are frequently able to quote rates 0.50% to 0.75% higher on equivalent quality products.
The best approach: use Fidelity’s rates as a benchmark, then compare to the broader market through an independent source. If you are already a Fidelity customer, that convenience has real value – but it is worth knowing what you are leaving on the table.
Are 5-Year Fixed Annuity Rates Going Up or Down?
5-year MYGA rates peaked in late 2023 and have gradually declined as the Federal Reserve began cutting rates in the second half of 2024. However, the decline has been slower than many expected – rates that hit 6.50% in late 2023 remain elevated today, only modestly below their peak.
The reason rates have held: insurance companies invest predominantly in investment-grade corporate bonds with 7-12 year durations. Those bond portfolios are rolling over slowly, which means the higher-yield bonds purchased in 2022-2023 are still generating strong returns – and carriers are passing some of that through to MYGA crediting rates.
The projection: most rate forecasts suggest 5-year MYGA rates will decline another 0.25% to 0.75% over the next 12-18 months as older bond positions mature and get replaced at lower current yields. If you are considering a 5-year MYGA, the window for the current rate level is narrowing – not closing, but narrowing.
That said, nobody times annuity markets perfectly. A guaranteed rate in today’s range for five years is objectively strong by any historical standard. Waiting for a hypothetical return to prior peaks while rates drift lower would likely cost you more than you would gain.
Have Questions? Talk to a Licensed Agent
Our licensed agents compare 90+ top annuity companies at no cost to you. No obligation, no pressure.
Frequently Asked Questions: 5-Year Fixed Annuity Rates
What is the best 5-year fixed annuity rate available right now?
As of August 2026, the best 5-year fixed annuity rate is 6.80% from a top-rated carrier (AM Best B+ or higher). Rates change daily – the live table at the top of this page reflects current best-available pricing from our carrier network.
How safe is a 5-year fixed annuity?
Your principal and earned interest are guaranteed by the issuing insurance company, not the federal government. State guaranty associations provide backup protection6 – typically $250,000 per carrier per owner – if the insurer becomes insolvent. For amounts above $250,000, split across two or more top annuity companies. Sticking with AM Best A- or higher ratings significantly reduces credit risk. See our insurance company ratings guide to compare financial strength scores.
Can I take money out of a 5-year fixed annuity early?
Most 5-year MYGAs allow a free partial withdrawal each year – typically 10% of the account value – without a surrender charge. Withdrawals beyond the free amount trigger surrender charges, which start at 7-9% in year one and decline each year, reaching zero at the end of the 5-year term. If you are under 59½, any earnings withdrawn are also subject to a 10% IRS penalty on top of ordinary income tax.
What happens to my 5-year fixed annuity when it matures?
At maturity, you typically have a 30-day window to choose your next step: withdraw the full amount (and pay taxes on the gains), renew for another term at current rates, or execute a tax-free 1035 exchange to a different annuity carrier or product. Missing the window usually triggers automatic renewal at whatever rate the carrier offers – which may or may not be competitive. Set a calendar reminder 60 days before maturity.
Do 5-year fixed annuity rates vary by state?
Yes. Not all products are approved in every state, and some carriers offer slightly different rates by state due to state-specific filing requirements. The table above filters automatically based on what is available in your state. A product showing a given rate nationally may show a lower rate or be unavailable entirely in your state of residence – always verify with the carrier or your licensed agent before applying.
How do 5-year MYGA rates compare to Fidelity’s fixed annuity rates?
Fidelity offers fixed annuities through a curated carrier panel, with 5-year rates typically in the 5.00% to 5.65% range from highly-rated carriers like MassMutual and New York Life. Independent brokerages access a broader market that includes carriers distributing exclusively through independent channels – which is why independent rates are frequently 0.50% to 0.75% higher on comparable quality products. We recommend comparing both before committing.
Is a 5-year fixed annuity the same as a 5-year MYGA?
Yes. A 5-year MYGA (multi-year guaranteed annuity) is a specific type of fixed annuity where the interest rate is locked in for the full 5-year term. Some older “traditional” fixed annuities reset their rate annually rather than locking in for the full term. When most people search for 5-year fixed annuity rates today, they are looking for MYGAs – the rate-locked version.
Who Is Behind This Page?
My Annuity Store is an independent licensed annuity brokerage, not a content site. Everyone on our team who answers the phone or responds to a quote request is a licensed insurance professional who can execute your transaction from quote to issued contract.
We earn a commission from the issuing carrier when you purchase – the same commission structure used by every licensed annuity agent in the country. That commission does not change your credited rate, your guaranteed value, or any contract term. It comes from the carrier’s distribution budget, not your account.
We do not sell leads. When you submit a quote request or call us, your information goes to our licensed agents – not to a network of agents who paid to receive your contact details.
We represent over 40 carriers independently, which is how we can show you the full competitive market rather than a curated list tied to one distribution relationship. If a carrier has a better rate for your situation, we will tell you – even if it means a smaller commission for us.
Plan Your Income
Sources
This page draws on primary industry and regulatory sources. Figures are current as of the last update.
