Best Fixed Annuity Rates for June 2, 2026

Fixed annuities pay a guaranteed interest rate for a set period and are often called “CD-type” annuities for their similarity to certificates of deposit. Compare today’s top MYGA rates from 90+ top annuity companies, then use the guide below to choose a term, a carrier, and the right time to buy.

Best Fixed Annuity Rates by Term

The table below shows the single highest fixed annuity rate available right now for each contract length, from 2 years out to 10 years. Rates update daily from AnnuityRateWatch and reflect the carriers we work with, so the rates you see here are what you’d get if you buy today.

Best 3 Year Fixed Annuity Rates

A 3-year fixed annuity (MYGA) locks in a guaranteed rate for a short commitment, making it a popular choice for savers who want competitive growth without tying up their money for long. It’s often used as a safe parking spot for cash you’ll need in the near term.

Best 5 Year Fixed Annuity Rates

The 5-year annuities are one of the most popular fixed annuity options, striking a balance between a strong guaranteed rate and a reasonable surrender period. 5 year annuities were 37% of My Annuitie Store’s annuity sales in 2025, while 7 year contracts came in second at 22%.

Best 7 Year Fixed Annuity Rates

A 7-year fixed annuity typically offers a higher guaranteed rate in exchange for a slightly longer commitment, rewarding savers willing to lock in their money for the medium term. It’s a solid fit if you want stronger compounding without going all the way to a decade.

Best 10 Year Fixed Annuity Rates

A 10-year fixed annuity locks in today’s rate for a full decade, often delivering some of the highest guaranteed yields available and shielding your money from future rate drops. It’s well suited for savers with a longer time horizon who value certainty above all.

What Is a Fixed Annuity?

A fixed annuity is a contract with an insurance company that pays a guaranteed interest rate for a set term, most commonly 3, 5, 7, or 10 years. Every fixed annuity moves through two distinct phases, and understanding both is the foundation for every other decision you’ll make about the product.

Fixed annuity rates are usually tied to the contract term. A 3-year annuity may offer one rate, while a 5-, 7-, or 10-year annuity may offer a different one. Longer terms often (but not always) pay higher yields.

Key contract features to compare

• Principal protection. Your original investment is shielded from market downturns.
• Tax-deferred growth. You won’t owe taxes on earnings until you withdraw, letting your money compound without annual tax drag.
• Surrender schedule. A surrender charge applies to withdrawals beyond the annual free amount during the surrender period. Schedules vary; some are steep.
• Free withdrawal provisions. Most MYGAs allow up to 10% of account value each year penalty-free.
• Market Value Adjustment (MVA). Adjusts surrender value for early withdrawals based on prevailing rates. Can work for or against you.
• Minimum premium. Some products require $2,500; others start at $25,000 or more.
• Insurer financial strength. Your guarantee is only as strong as the insurer behind it.

Simple Interest vs Compound Interest

Most fixed annuities pay compound interest, which means you earn interst on your interst. A smaller number fixed annuities pay simple interest which means you only earn interest on your initital deposit. This means a lower interest rate can pay you more money over time than an annuity with a higher simple interest rate.

PRO TIP: If you are going to withdraw your interest every month or year, then you can compare a simple interest rate to a compound interest are apples to apples. Depending on market conditions, an annuity with simple interest will likely pay you more if you plan to use free withdrawals of interest. Try our compound vs simple interest calculator here.

$100,000 at 5.90% over 5 years. Compounding produces $3,693 more, a gap that widens significantly over longer terms.

What Affects Fixed Annuity Rates?

Rates are driven by a mix of market conditions, insurer strategy, and product design. The factors below explain why one contract pays 6.50% while another pays 5.20% on the same term.

• Interest rates and Treasury yields. Insurers invest premiums in bonds, so when yields rise, annuity rates rise.
• Contract term length. Longer terms usually pay more, but lock you in longer.
• Insurer pricing strategy. Some carriers compete aggressively on rate; others offer slightly lower yields with stronger ratings.
• Financial strength and risk profile. Lower-rated carriers often lead the rate tables.
• State availability. A contract offered in Florida may not be approved in New York.
• Premium amount. Deposits of $100,000+ typically earn higher tier rates.
• Optional features and liquidity. Enhanced free withdrawals and riders trade base rate for flexibility.

Fixed Annuity Laddering Strategy

One of the smartest ways to maximize your returns while keeping flexibility is through a laddering strategy. Instead of buying a single annuity, you split your investment across multiple contracts with staggered maturities.

A real-dollar example

Jim, age 63, has $150,000 he wants to protect. Instead of locking everything into one 10-year annuity, he splits it into three equal contracts:

When Jim’s first annuity matures in 2029, it has grown to roughly $58,600. He can access this money penalty-free and reinvest, while his other two contracts keep compounding tax-deferred.

How to Pick the Right Annuity Company

Fixed annuities are not FDIC insured. Your guarantee is only as strong as the insurer behind it, which makes evaluating the carrier just as important as comparing rates.

1 · Check the AM Best rating

2 · Understand state guaranty coverage

Every state has a guaranty association covering policyholders if an insurer becomes insolvent. Limits typically run $250,000 to $500,000 per person, per carrier. If you’re investing more than your state’s limit with one carrier, consider splitting between two.

3 · Look past the headline rate

The highest rate means nothing if the contract has punishing surrender charges, a harsh MVA formula, or restrictive withdrawal provisions.

What Companies Have the Best Fixed Annuities?

The best annuity for you will depend on your own goals and objectives, but Athene sold the most(2025), New York Life Insurance and Mass Mutual are the highest rated, and American Gulf has the highest compounding rate.

Is Now a Good Time to Buy a Fixed Annuity?

For most savers, the best time to buy a fixed annuity is when you have money you want to protect and grow without market risk, and right now rates remain attractive compared to much of the past decade. Because a fixed annuity locks in your rate for the entire term, buying while rates are strong means you keep that guaranteed yield even if rates fall later. Waiting for a “perfect” rate often backfires, since you give up months of guaranteed earnings chasing a peak no one can reliably predict.

That said, timing matters less than fit. The right move is to match the term to when you’ll actually need the money, then secure the most competitive rate available for that term. If you’re holding cash that’s earning little in a savings account or sitting idle, locking in a guaranteed fixed annuity rate today is often a smarter use of those dollars than waiting on the sidelines.

After bottoming out at historic lows in 2021, 5-year MYGA rates rebounded sharply and have stayed elevated in the years since. For buyers looking to lock in guaranteed long-term returns, today’s rates mark one of the most favorable windows in recent memory.

What Happens at Maturity?

When your fixed annuity reaches the end of its guarantee period, you typically have four options:

• Renew with the same carrier. Most insurers offer a renewal rate for another term. Watch for automatic 1-year renewals at lower rates if you don’t act.
• Transfer via 1035 exchange. Move funds tax-free to a new carrier offering a better rate.
• Take a lump-sum withdrawal. Owe ordinary income tax on the gains; no IRS penalty if you’re over 59½.
• Annuitize for lifetime income. Convert to a stream of monthly, quarterly, or annual income payments based on age and account value.

If a different carrier offers a better rate, a 1035 exchange moves the money tax-free, and we handle that paperwork for clients at no cost.

Understanding Surrender Charges

Surrender charges are the trade-off for the higher rates that fixed annuities offer. The carrier guarantees your rate for the full term, and in return expects your money to stay put.

Representative surrender schedule. Actual charges vary by carrier and contract. Most MYGAs let you withdraw up to 10% of account value each year penalty-free.

Fixed Annuities vs CD Rates

Fixed annuities (MYGAs) are often compared to bank CDs because both guarantee a fixed rate for a set period and protect principal.

A CD is issued by a bank and insured by the FDIC up to $250,000 per depositor. A fixed annuity is issued by an insurance company, backed by that carrier’s financial strength and claims-paying ability and by your state’s guaranty association. On rate alone, MYGAs have generally paid 1.0% to 1.75% more than top CDs at the same term over the last 24 months, and the gap widens as the term lengthens.

Tax treatment is the bigger story. A CD issues a 1099-INT every year and you owe ordinary income tax on the interest even if you never touch the money. A fixed annuity defers that tax until you withdraw, so every dollar of interest compounds untouched for the full term. On a $100,000 deposit in the 24% bracket, that deferral alone is worth roughly $1,200 to $1,500 over three years compared to a CD at the same rate.
For a full breakdown, see our fixed annuity vs CD comparison guide or run your numbers through our CD vs annuity calculator.

Who Should Buy a Fixed Annuity?

A fixed annuity tends to fit a few specific situations:

• You want a guaranteed rate for a defined period. Pick the term that comfortably outlasts your need for the money, then lock in today’s rate for the entire window.
• You are laddering. Splitting funds across 3-, 5-, and 7-year contracts smooths out reinvestment risk and keeps a portion maturing every two years.
• You are parking matured annuity funds. A 1035 exchange moves money tax-free into a new MYGA at today’s rates, with no taxable event.
• You are over age 59½ and want a tax-deferred alternative to a CD. The rate premium plus tax deferral compounds in your favor for the full term.
• You are in a high tax bracket. Tax deferral compounds harder the higher your bracket.

A fixed annuity is less attractive if you need liquidity inside the term, are under age 59½ with no other reserves, or want exposure to market upside (in which case a fixed indexed annuity may fit better).

How Are Fixed Annuities Taxed?

Inside the contract, interest compounds tax-deferred. You do not receive a 1099-INT each year. You owe tax only when you withdraw.

When the term ends, you have four tax-relevant options:

• Withdraw everything. The interest portion is taxed as ordinary income in that year; principal comes back tax-free.
• Renew for a new term. Tax deferral continues, with no taxable event.
• 1035 exchange to another annuity. A tax-free transfer under IRS Section 1035, common for buyers who want a different carrier or term.
• Annuitize. Convert the balance into a stream of payments. Each payment is partly taxable (the interest portion) and partly a return of principal, using the exclusion ratio.

If you withdraw gains before age 59½, the IRS adds a 10% penalty on top of ordinary income tax. Qualified money (IRA-held annuities) follows IRA rules, not annuity rules, on the pre-59½ penalty.

How to Buy a Fixed Annuity

The process takes 15 to 30 minutes and looks roughly the same at every carrier:

• Step 1: Compare live rates. Use the table above or request a personalized rate report with your state, age, and deposit amount.
• Step 2: Review carrier financials. Check AM Best, S&P, and Moody’s ratings. We recommend A- or better.
• Step 3: Complete the application. Most carriers offer e-application. You will need ID, beneficiary info, and a funding source.
• Step 4: Fund the contract. Transfer from a bank, another annuity (1035), or an IRA rollover.
• Step 5: Free-look period. Every state gives you 10 to 30 days to review the issued contract and cancel penalty-free.

My Annuity Store works with 90+ top annuity companies and does not charge a fee for our service. You work directly with a licensed employee, never a call center.