Purchasing MYGAs (multi year guaranteed annuities) - mega thread

[indexfundfan]

There is an option 5 for you -- fixed maturity bond ETFs from iShares

https://www.ishares.com/us/products/304 ... porate-etf

Stinky mentioned this option upthread.

I wouldn't go with the callable options since these are not really comparable to the others with a fixed return. If the CD or bond is called, it will usually be because rates have fallen. You would not be able to find replacement investments to have the same yield.

[Stinky]

Still doing my due diligence on MYGA's for a rollover IRA. While I have voiced my opinion in other threads on index annuities (very poor service and delays with redemption of inherited IRA), this thread has me rethinking my options using MYGA's. Below are some of my considerations and overall thoughts:

Annuity Option - MI Guaranty Limit @ $250K
1) Canvas 5-yr MYGA @ 6.5%. "B++" Rating. 10% annual withdrawal limit.
2) Athene IA 5-yr MYGA @ 6.15%. "A" Rating. Interest only withdrawal limit.
Based upon the impairment rates shared in this thread, the A rating product (1.45%) is ~ 65% less risk than the B++ rating product (4.3%). While not a huge risk, state receivership sounds like a nightmare (Colorado Example provided in thread). The withdrawal limit is a lower concern as I will probably let it ride the duration of term, but it's nice to have options. Additional considerations are the delays in contract creation and redemption delays voice many times here with variety of companies.

Alternate Option
3) 5-yr CD @ 5.65%. Non-Call protected. FDIC Insured.
4) Federal Home Loan Banks Bond @ 6.05% (7-yr @ 6.18%). Non-Call protected. US Gov't backed.
While non-call protected, these options are very interesting given their reduction in risk and ability to re-sell on secondary market.

Overall, I'm thinking the alternative options will be lesser headache for me in the long run and follow a "simplicity" theory, but there is a limited risk of CD/Bond being called. If called, I will just need to find another option. Is my logic correct here, am I missing something else, or am I overthinking?

I'm agreeing with poster "indexfundfan" on a couple of fronts.

First, I'm not a fan of callable instruments. If there is to be an "option" in a financial instrument that I purchase, I'd rather be the one holding the option (for example, to take free partial withdrawals) rather than having the counterparty hold the option (for example, to call the CD or FHLB bond).

Second, I've definitely been looking at the iShares iBonds as a "defined maturity" alternative to MYGAs. For your time horizon, I'd be looking at the December 2028 Term Corporate ETF, ticker symbol IBDT. Per the iShares website, the NAV as of 11/10/23 was $23.98. If you were to purchase at that price, the "Estimated Net Acquisition Yield Calculator" on the website estimates a yield of 5.78%. From that, I'd mentally subtract about 0.10% for future defaults, leading to a yield of 5.68%.

Some comparisons between MYGAs and "Corporate" iBonds -
--- MYGAs compound interest, while iBonds pay a monthly dividend
--- iBonds, and most MYGAs, have a "market value adjustment" if redeemed before their termination date. However, MYGAs also have a steep surrender charge for early termination, which iBonds do not have
--- Most MYGAs have "free partial withdrawals" at book value. iBonds do not have that
--- MYGAs have state guaranty fund protection. iBonds have the benefit of issuer diversification, but no other protection.
--- iBonds can be bought in any denomination, and can be easily traded within a brokerage account. MYGAs may require a large deposit ($100k or more) to get the best rate. Also, it may be inefficient to purchase multiple MYGAs because of the complexity involved with holding lots of insurance company contracts.

If I had a relatively large amount of money (say $100k+) that I was looking to lock up for five years, I'd personally find the MYGAs you quote to be strong contenders, based on the rates you mentioned above. However, I wouldn't fault you for looking at iBonds.

Also, rates change over time, often weekly. So recheck your math whenever you have money that you want to invest.

When I started this thread in late 2020, the rates being offered on MYGAs were very compelling compared to the alternatives. Now, MYGA rates are still interesting, but much less compelling than they were in the 2020-21 timeframe.

Post back if you have questions.

[AllMostThere]

I'm agreeing with poster "indexfundfan" on a couple of fronts.

First, I'm not a fan of callable instruments. If there is to be an "option" in a financial instrument that I purchase, I'd rather be the one holding the option (for example, to take free partial withdrawals) rather than having the counterparty hold the option (for example, to call the CD or FHLB bond).

Second, I've definitely been looking at the iShares iBonds as a "defined maturity" alternative to MYGAs. For your time horizon, I'd be looking at the December 2028 Term Corporate ETF, ticker symbol IBDT. Per the iShares website, the NAV as of 11/10/23 was $23.98. If you were to purchase at that price, the "Estimated Net Acquisition Yield Calculator" on the website estimates a yield of 5.78%. From that, I'd mentally subtract about 0.10% for future defaults, leading to a yield of 5.68%.

Some comparisons between MYGAs and "Corporate" iBonds -
--- MYGAs compound interest, while iBonds pay a monthly dividend
--- iBonds, and most MYGAs, have a "market value adjustment" if redeemed before their termination date. However, MYGAs also have a steep surrender charge for early termination, which iBonds do not have
--- Most MYGAs have "free partial withdrawals" at book value. iBonds do not have that
--- MYGAs have state guaranty fund protection. iBonds have the benefit of issuer diversification, but no other protection.
--- iBonds can be bought in any denomination, and can be easily traded within a brokerage account. MYGAs may require a large deposit ($100k or more) to get the best rate. Also, it may be inefficient to purchase multiple MYGAs because of the complexity involved with holding lots of insurance company contracts.

If I had a relatively large amount of money (say $100k+) that I was looking to lock up for five years, I'd personally find the MYGAs you quote to be strong contenders, based on the rates you mentioned above. However, I wouldn't fault you for looking at iBonds.

Also, rates change over time, often weekly. So recheck your math whenever you have money that you want to invest.

When I started this thread in late 2020, the rates being offered on MYGAs were very compelling compared to the alternatives. Now, MYGA rates are still interesting, but much less compelling than they were in the 2020-21 timeframe.

Post back if you have questions.

^^^+1. This, this is why I come to this forum to learn and share. Precise detailed information with zero snark! Stinky, thank you for this very insightful post and alternative option. Awesome. I will look into IBDT.

[Skyway]

AllMostThere,
The main benefit that a MYGA has is the tax deferral. You dont need that in an IRA. Thus it makes more sense to consider other options.
And there is no comparison between products backed by the US Government or the FDIC and B++ or even A rated insurance companies.

[Stinky]

^^^+1. This, this is why I come to this forum to learn and share. Precise detailed information with zero snark! Stinky, thank you for this very insightful post and alternative option. Awesome. I will look into IBDT.

Thank you for your kind words.

I try to live in a snark-free zone. I think I succeed (at least most of the time).

Best to you.

[Chardo]

AllMostThere,
The main benefit that a MYGA has is the tax deferral. You dont need that in an IRA. Thus it makes more sense to consider other options.
And there is no comparison between products backed by the US Government or the FDIC and B++ or even A rated insurance companies.

A MYGA is essentially a CD alternative, backed by a state based guarantee against insolvency. And also happens to include tax deferral whether you need it or not. You can buy a MYGA in an IRA, and just ignore the tax deferral. MYGA can and should be considered by anyone looking for a fixed guarantee like a CD.

[WestWorld1986]

Overall, I'm thinking the alternative options will be lesser headache for me in the long run and follow a "simplicity" theory, but there is a limited risk of CD/Bond being called. If called, I will just need to find another option. Is my logic correct here, am I missing something else, or am I overthinking?

I, too, contemplated much the same and ended up opting for 7-year ‘A’ and ‘A+’ rated companies for my MYGAs.

The deciding factor was the eagerness of the Federal Reserve to want to tame down inflation, which “should” raise upside resistance on interest rates.

[krafty81]

See above. I looked at Athene but eventually went with Delaware at 6.15%. (A) I did not like the offshore aspect of Athene.

[Skyway]

Chardo,

I understand what you are saying, but an annuity from a B++ insurance company is not a substitute for an FDIC backed CD or
a treasury bond. Yes there is the guaranty fund, but that is not the same as FDIC insurance. If you think differently maybe you can
explain that to an annuity holder of Colorado Bankers Life.
I am not against MYGA's, I just think putting your money with a B++ or other lower rated insurance company is not wise for a slight amount of higher interest. I feel people in this thread are thinking they are completely safe up to guaranty amounts without understanding the drawbacks.
People should also understand that these are backed by state guaranty funds, not by the state itself.
As for the tax deferral, that is unique to the annuity and why in certain situations make the MYGA a better choice than the CD, but please consider highly rated insurance companies.

[Chardo]

Chardo,

I understand what you are saying, but an annuity from a B++ insurance company is not a substitute for an FDIC backed CD or
a treasury bond. Yes there is the guaranty fund, but that is not the same as FDIC insurance. If you think differently maybe you can
explain that to an annuity holder of Colorado Bankers Life.
I am not against MYGA's, I just think putting your money with a B++ or other lower rated insurance company is not wise for a slight amount of higher interest. I feel people in this thread are thinking they are completely safe up to guaranty amounts without understanding the drawbacks.
People should also understand that these are backed by state guaranty funds, not by the state itself.
As for the tax deferral, that is unique to the annuity and why in certain situations make the MYGA a better choice than the CD, but please consider highly rated insurance companies.

Of course people should be cautious about investing with low rated insurers. That's why ratings exist. Even though a backup guarantee is there, it's not something you want to deal with. The headache isn't worth the extra pennies of interest you might get. But your post was claiming that MYGAs should be avoided if tax deferral isn't needed. And that's not right. The interest rate is the interest rate. There's no extra charge. If a MYGA rate happens to be attractive and you're satisfied with the carrier, go for it. You don't have to look at other options just because you don't need tax deferral.

[Stinky]

But your post was claiming that MYGAs should be avoided if tax deferral isn't needed. And that's not right. The interest rate is the interest rate. There's no extra charge. If a MYGA rate happens to be attractive and you're satisfied with the carrier, go for it. You don't have to look at other options just because you don't need tax deferral.

I agree with Chardo.

I bought a number of MYGAs in 2020 and 2021 inside my IRA because the interest rates were very attractive compared to the alternatives available at the time.

Even though my 2020 and 2021 MYGA interest rates don’t look so attractive now compared to current market rates, I’ve got a couple of nice benefits. First, I’ve been able to make free partial withdrawals at book value. Second, as the MYGAs mature, I’m getting account value plus accrued interest.

Neither one of those nice features are available on a bond fund. Selling a bond fund now that was purchased in 2020-2021 would entail a significant capital loss.

I’ve kept a spreadsheet tracking my results on the MYGAs compared to what would have happened had I left the money in my preferred corporate bond funds. When all of those 2020-2021 MYGAs have matured, I estimate that I’ll have made an additional return of 5-10% beyond the comparable bond funds on the original invested amount by holding MYGAs in a time of rising interest rates and exercising my contractual options on withdrawals.

[mtmingus]

What not to like when you could get 6+% interests of at least A- rated MYGAs (withdrawal INT or 10%) for 7 years?

[tj]

What not to like when you could get 6+% interests of at least A- rated MYGAs (withdrawal INT or 10%) for 7 years?

For me it s the 10% pre-59.5 penalty. It effectively has to be a 20 year hold to avoid a penalty. I don't think I can realistically do MYGAs until i am at an age where maturity is after 59.5 or reasonably close to that.

[Rajsx]

We bought(DW) a MYGA with Western Southern A+ rating at 5.35% with Fidelity for 3 yrs in a taxable account.

[Chardo]

What not to like when you could get 6+% interests of at least A- rated MYGAs (withdrawal INT or 10%) for 7 years?

For me it s the 10% pre-59.5 penalty. It effectively has to be a 20 year hold to avoid a penalty. I don't think I can realistically do MYGAs until i am at an age where maturity is after 59.5 or reasonably close to that.

Unless you're buying that MYGA in an IRA. Then you're restricted before 59.5 anyway. Even in taxable, there's nothing wrong with allocating some long term money you won't need before 59. You can still roll it to other annuities along the way, just can't pull down and spend.

[AlwaysLearningMore]

See above. I looked at Athene but eventually went with Delaware at 6.15%. (A) I did not like the offshore aspect of Athene.

Would be interesting to learn how AM Best arrived at the "A" rating for Athene given its offshore component (e.g., how reinsurance was evaluated, which documents were checked, verifications, etc.) Also interesting would be to learn how individual states evaluate and monitor this. I've heard that New York State is amongst the most thorough in its evaluation of insurance companies; Athene appears to operate in New York State https://www.annuityadvantage.com/insura ... -new-york/

[Stinky]

See above. I looked at Athene but eventually went with Delaware at 6.15%. (A) I did not like the offshore aspect of Athene.

Would be interesting to learn how AM Best arrived at the "A" rating for Athene given its offshore component (e.g., how reinsurance was evaluated, which documents were checked, verifications, etc.) Also interesting would be to learn how individual states evaluate and monitor this. I've heard that New York State is amongst the most thorough in its evaluation of insurance companies; Athene appears to operate in New York State https://www.annuityadvantage.com/insura ... -new-york/

AM Best (and other rating agencies) do a comprehensive review of all aspects of a life insurance company when they come to a rating. The view includes capitalization, profitability, business profile, quality of management, risk management capabilities, and on and on. One area of focus by the rating agencies were for Athene is likely to be the collectability of reinsurance ceded; that is, what collateral or other security assures that the reinsurance will be available when the claims come in.

Rating agencies give their highest ratings to companies that have a balance of business (life insurance and annuities). I don’t expect to see many, if any, companies that are almost entirely annuity writers (like Athene) to rise above the A level from Best.

State regulators analyze many of the same things that rating agencies look at. They definitely focus on reinsurance ceded. Major related-party transactions like affiliated reinsurance require pre approval.

Many companies that write business in New York do so through a separate, NY-only company. I expect that Athene does that. I believe that the primary Athene company is domiciled in Iowa, who then becomes that company’s primary regulator. I expect that Athene is writing its NY business through a different legal entity, domiciled in NY.

If my supposition is true, then the NY regulators would have authority only over business in the NY company. They would have no enforcement power over the much larger Iowa company.

I don’t have an easy way to check out the Athene New York business. But I do note that Athena’s rate in NY for amounts of $100k or more is 0.70% lower than the rate in most other states. I suspect, but don’t know for sure, that the difference in rate is because of (a) NY’s generally more conservative regulations, and (b) little or no offshore reinsurance of NY business.

[AlwaysLearningMore]

See above. I looked at Athene but eventually went with Delaware at 6.15%. (A) I did not like the offshore aspect of Athene.

Would be interesting to learn how AM Best arrived at the "A" rating for Athene given its offshore component (e.g., how reinsurance was evaluated, which documents were checked, verifications, etc.) Also interesting would be to learn how individual states evaluate and monitor this. I've heard that New York State is amongst the most thorough in its evaluation of insurance companies; Athene appears to operate in New York State https://www.annuityadvantage.com/insura ... -new-york/

AM Best (and other rating agencies) do a comprehensive review of all aspects of a life insurance company when they come to a rating. The view includes capitalization, profitability, business profile, quality of management, risk management capabilities, and on and on. One area of focus by the rating agencies were for Athene is likely to be the collectability of reinsurance ceded; that is, what collateral or other security assures that the reinsurance will be available when the claims come in.

Rating agencies give their highest ratings to companies that have a balance of business (life insurance and annuities). I don’t expect to see many, if any, companies that are almost entirely annuity writers (like Athene) to rise above the A level from Best.

State regulators analyze many of the same things that rating agencies look at. They definitely focus on reinsurance ceded. Major related-party transactions like affiliated reinsurance require pre approval.

Many companies that write business in New York do so through a separate, NY-only company. I expect that Athene does that. I believe that the primary Athene company is domiciled in Iowa, who then becomes that company’s primary regulator. I expect that Athene is writing its NY business through a different legal entity, domiciled in NY.

If my supposition is true, then the NY regulators would have authority only over business in the NY company. They would have no enforcement power over the much larger Iowa company.

I don’t have an easy way to check out the Athene New York business. But I do note that Athena’s rate in NY for amounts of $100k or more is 0.70% lower than the rate in most other states. I suspect, but don’t know for sure, that the difference in rate is because of (a) NY’s generally more conservative regulations, and (b) little or no offshore reinsurance of NY business.

Thank you for the insights, especially that primarily annuity writers are not likely to be rated above A. For "Bermuda triangle" associated insurers, one can only hope that the efforts of Best, and all of the various state insurance agencies, will be diligent in picking up any "irregularities" with reinsurance. They must have their work cut out for them, especially auditing foreign jurisdiction. It would be interesting to know the basics of what levers are available to them regarding the safety and strength of the reinsurance agreements.

[WestWorld1986]

Just curious, but is anyone aware of any annuity companies that have a rating below B++ ? I wouldn’t think they exist, but anything is possible.

[Stinky]

Just curious, but is anyone aware of any annuity companies that have a rating below B++ ? I wouldn’t think they exist, but anything is possible.

SILAC is the only B+ company that writes in my state on Blueprint Income. No companies rated lower than that on Blueprint

[retireIn2020]

Just curious, but is anyone aware of any annuity companies that have a rating below B++ ? I wouldn’t think they exist, but anything is possible.

Check the comdex rankings. This is a ranking that includes more information than just A.M. Best. Example is Fidelity only uses annuity companies rated at the top of this list.

Anyway, if you look at the comdex report, you can see there are many non-rated companies as well as B+ (moody's). The lower the comdex ranking the higher the risk.

https://assets-global.website-files.com ... Report.pdf

[WestWorld1986]

Just curious, but is anyone aware of any annuity companies that have a rating below B++ ? I wouldn’t think they exist, but anything is possible.

Check the comdex rankings. This is a ranking that includes more information than just A.M. Best. Example is Fidelity only uses annuity companies rated at the top of this list.

Anyway, if you look at the comdex report, you can see there are many non-rated companies as well as B+ (moody's). The lower the comdex ranking the higher the risk.

https://assets-global.website-files.com ... Report.pdf

Interesting…. Thanks for the info. In looking at codex, I’m delighted to see that my MYGAs were all issued by companies having high scores.

[Skyway]

Stinky,
Corporate bond funds aren't the only alternatives to a MYGA and of course during rising interest rates bond funds will not perform well.
As I have said, I don't have a problem with MYGA's, just ones issued by low rated insurance companies. I feel like you are downplaying how poor some of these ratings are. A B++ rating is not reasonably good as you said early on in this thread.

mtmingus,
One thing not to like is the A- rating.

Rajsx,
That is an example of a great use of an MYGA. You got a reasonable rate from a solid company, as well as tax deferral that no other product could give you.

retireIn2020,
Thank you for that list. It puts in perspective how far away from the top companies some of these lower rated companies are.

[bog007]

Canvas up to 6.5% 5 year. About to buy my 2nd myga. First was Gainbridge

[soretired]

Canvas up to 6.5% 5 year. About to by my 2nd myga. First was Gainbridge

It's been 6.5 for a while. I've bought two.

[bog007]

ok I see the 3 and 7 year went up

3-YEAR TERM 6.30%
5-YEAR TERM 6.50%
7-YEAR TERM 6.35%

[soretired]

ok I see the 3 and 7 year went up

3-YEAR TERM 6.30%
5-YEAR TERM 6.50%
7-YEAR TERM 6.35%

That's good news. Thank goodness for the state's Guarantee Assoc.

[ReadyOne]

Is using an IRA to fund the an annuity the definition of a QLAC (close enough)? Or is a QLAC a specific product which happens to be funded by an IRA?

Thanks!

[Stinky]

Is using an IRA to fund the an annuity the definition of a QLAC (close enough)? Or is a QLAC a specific product which happens to be funded by an IRA?

Thanks!

A QLAC is a specific “payout annuity” product which is funded from an IRA.

Here’s a nice summary of the product. You can find a lot more if you google “QLAC”.

https://blog.massmutual.com/retiring-in ... %20annuity.

[krafty81]

By pure luck, I locked in Delaware LIfe MYGA at 6.15%. Today they dropped to 5.85%. 5 year MYGA.

[krafty81]

Just curious, but is anyone aware of any annuity companies that have a rating below B++ ? I wouldn’t think they exist, but anything is possible.

Check the comdex rankings. This is a ranking that includes more information than just A.M. Best. Example is Fidelity only uses annuity companies rated at the top of this list.

Anyway, if you look at the comdex report, you can see there are many non-rated companies as well as B+ (moody's). The lower the comdex ranking the higher the risk.

https://assets-global.website-files.com ... Report.pdf

Canvas (Purtitan) is b++

[WestWorld1986]

I’m struggling with the thought of buying into Ibexis. The monthly income stream from the 6.7% interest rate would sure be nice. It’s that A- rating that’s giving me pause.

[rich126]

I’m struggling with the thought of buying into Ibexis. The monthly income stream from the 6.7% interest rate would sure be nice. It’s that A- rating that’s giving me pause.

Their history kind of goes back to 1937 according to their website (which you probably have seen):

1937 Sunset Life Insurance Company of America (SSL) -> 1975 Kansas City Life -> 2021 SSL was purchased by an insurance-focused investment platform to operate as a free-standing entity -> SSL was rebranded as Ibexis Life & Annuity Insurance Company with a new, exclusive focus on fixed annuities

But yeah, I'd much prefer to use CDs or Treasuries than dealing with insurance companies. My first MYGA that matured was pretty easily transferred to Fidelity. My next one is from another company and matures in Feb. Hopefully that one goes well. I don't know why but I just seem like it is a fight to get your money back which is why I did not roll it into another MYGA.

[WestWorld1986]

I don't know why but I just seem like it is a fight to get your money back which is why I did not roll it into another MYGA.

This concerns me as well. I’m constantly worrying about the struggle that I might encounter once my MYGAs mature.

[Stinky]

I don't know why but I just seem like it is a fight to get your money back which is why I did not roll it into another MYGA.

So far I've had two MYGAs mature. I exchanged both of them into new MYGAs at different companies. No problems, minimal amount of time that my money was out of the market (just USPS time).

Next maturity is 3rd quarter 2024. Tentatively planning to return the money to my Vanguard IRA.

[WestWorld1986]

I don't know why but I just seem like it is a fight to get your money back which is why I did not roll it into another MYGA.

So far I've had two MYGAs mature. I exchanged both of them into new MYGAs at different companies. No problems, minimal amount of time that my money was out of the market (just USPS time).

Next maturity is 3rd quarter 2024. Tentatively planning to return the money to my Vanguard IRA.

Always grateful for the reassurance

[BarbK]

I don't know why but I just seem like it is a fight to get your money back which is why I did not roll it into another MYGA.

This concerns me as well. I’m constantly worrying about the struggle that I might encounter once my MYGAs mature.

I have done 1035 exchanges and fully cashed out MYGAs and neither presented a problem or took very long. Actually, I was pleasantly surprised how easy it was to get my money.

My next two are due in May / June. One of them is an IRA which I plan to send back to the IRA. That was my first and only IRA MYGA.
The other in taxable will probably do a 1035 exchange depending on rates.

[WestWorld1986]

I have done 1035 exchanges and fully cashed out MYGAs and neither presented a problem or took very long. Actually, I was pleasantly surprised how easy it was to get my money.

My next two are due in May / June. One of them is an IRA which I plan to send back to the IRA. That was my first and only IRA MYGA.
The other in taxable will probably do a 1035 exchange depending on rates.

Thank you for posting this information. Please keep us posted as to the outcome of your next two maturities.

[Wrench]

I have attempted three MYGA purchases. All were 1035 exchanges from old life insurance policies. One failed completely - the company attempted to exchange, it did not go through, and refused to follow-up. When i tried to follow up, the sending company said the receiving company had to do it. Since they would not and the broker did not help, I cancelled the transaction. The second went "smoothly" I guess, but took ~3 weeks to complete with multiple back and forth emails involved. The third is in process - one week and counting and no idea when or if it will go through. So based on my limited experience I would say that purchasing a MYGA is among the slowest, most painful financial transactions I have ever done. The only one worse is obtaining a mortgage. Stock, bonds, options, credit cards, bank accounts, moving IRAs or funds from one brokerage to another, personal loans are all a piece of cake in comparison. The insurance companies have (mostly) set up a structure using brokers as middle men, then required paper applications that have to be manually completely (by someone), signed, then sent to the company, reviewed, approved and then (usually, or at least often) paper checks sent. Then the receiving company goes through some similar manual process. The whole MYGA process is mired in the 20th century circa 1950s. Some of that may be government regulations. I don't know. Bottom line, if you are buying a MYGA, just be aware of the arcane, slow process that may or may not require your constant attention over many weeks. If MYGAs were not the only tax-efficient way I could get out of these old life insurance policies I would never buy another one. YMMV

Wrench

[indexfundfan]

So based on my limited experience I would say that purchasing a MYGA is among the slowest, most painful financial transactions I have ever done. The only one worse is obtaining a mortgage. Stock, bonds, options, credit cards, bank accounts, moving IRAs or funds from one brokerage to another, personal loans are all a piece of cake in comparison. The insurance companies have (mostly) set up a structure using brokers as middle men, then required paper applications that have to be manually completely (by someone), signed, then sent to the company, reviewed, approved and then (usually, or at least often) paper checks sent. Then the receiving company goes through some similar manual process. The whole MYGA process is mired in the 20th century circa 1950s. Some of that may be government regulations. I don't know. Bottom line, if you are buying a MYGA, just be aware of the arcane, slow process that may or may not require your constant attention over many weeks. If MYGAs were not the only tax-efficient way I could get out of these old life insurance policies I would never buy another one. YMMV

Good summary. I have similar experience as well and I have stopped purchasing new MYGAs. To me, only one carrier (Gainbridge) stands out in terms of offering better / faster processing.

[Jazz4cash]

First post here, I think.
Thanks to Mr. Sticky and the other experts for starting and maintaining this thread. I was referred here from another forum, and I just finished reading all 39 pages. I must also offer kudos to all participants for staying on topic! Curiously I bought my first MYGA from Americo through Blueprint in Dec of 2020. That's about the same time this thread was started! I finally overcome an irrational belief that annuity = bad. At the time I had maturing CDs and the renewal rates were unattractive. I was never into bond funds.

My experience with Blueprint has been very good and Americo has been "OK". I chose Blueprint because of their excellent website but Stan Annuity Man and ImmediateAnnuities.com were very good also. I knew right away in the application process the MYGA was not at all like buying a CD or bond when they kept asking questions related to "suitability". That was confirmed when the 60 pg contract was delivered. I did try to read it!

I bought a second MYGA from Americo in 4/2022 and a third in 4/23. I took 10% free withdrawals from the 1st two MYGAs to fund the 3rd. Americo "lost" one of the withdrawal checks so there was a delay. Then, it took forever to issue the 3rd contract. This was about the time Americo was no longer displayed on the Blueprint website. I even asked the Blueprint rep if they had dropped Americo but he said "No, they are just swamped". I was
even able to take a free withdrawal on a MYGA contract within the first year. Americo dropped the free withdrawal to 5% for my 3rd contract.

i have another credit union CD that just matured and I am looking at the 5yr Canvas Freedom Fund as I am comfortable with B++. I would prefer an A rated company but I would like to have a rate close to 6%. It is easy for me to justify B++ because the contracts are tiny and I have generally higher rated Fixed Income assets including CDs, bonds and treasuries.

[Jazz4cash]

First post here, I think.
Thanks to Mr. Sticky and the other experts for starting and maintaining this thread. I was referred here from another forum, and I just finished reading all 39 pages. I must also offer kudos to all participants for staying on topic! Curiously I bought my first MYGA from Americo through Blueprint in Dec of 2020. That's about the same time this thread was started! I finally overcome an irrational belief that annuity = bad. At the time I had maturing CDs and the renewal rates were unattractive. I was never into bond funds.

My experience with Blueprint has been very good and Americo has been "OK". I chose Blueprint because of their excellent website but Stan Annuity Man and ImmediateAnnuities.com were very good also. I knew right away in the application process the MYGA was not at all like buying a CD or bond when they kept asking questions related to "suitability". That was confirmed when the 60 pg contract was delivered. I did try to read it!

I bought a second MYGA from Americo in 4/2022 and a third in 4/23. [EDIT; When I bought the 4/22 contract the rates went up right after I applied. Blueprint said I could fill out some forms once the contract was issued to get the higher rate but Americo gave me the higher rate without even asking.] I took 10% free withdrawals from the 1st two MYGAs to fund the 3rd. Americo "lost" one of the withdrawal checks so there was a delay. Then, it took forever to issue the 3rd contract. This was about the time Americo was no longer displayed on the Blueprint website. I even asked the Blueprint rep if they had dropped Americo but he said "No, they are just swamped". I was
even able to take a free withdrawal on a MYGA contract within the first year. Americo dropped the free withdrawal to 5% for my 3rd contract.

i have another credit union CD that just matured and I am looking at the 5yr Canvas Freedom Fund as I am comfortable with B++. I would prefer an A rated company but I would like to have a rate close to 6%. It is easy for me to justify B++ because the contracts are tiny and I have generally higher rated Fixed Income assets including CDs, bonds and treasuries.

EDIT: Upon further review.......Americo's 5yr MYGA is listed on Blueprint Income at 5.75 going to 5.95 soon. That qualifies for the "close to 6%" criteria I mentioned above. While I would prefer to diversify away from Americo I am still well below SGA limit for my state.

[Stinky]

First post here, I think.
Thanks to Mr. Sticky and the other experts for starting and maintaining this thread. I was referred here from another forum, and I just finished reading all 39 pages. I must also offer kudos to all participants for staying on topic! Curiously I bought my first MYGA from Americo through Blueprint in Dec of 2020. That's about the same time this thread was started! I finally overcome an irrational belief that annuity = bad. At the time I had maturing CDs and the renewal rates were unattractive. I was never into bond funds.

My experience with Blueprint has been very good and Americo has been "OK". I chose Blueprint because of their excellent website but Stan Annuity Man and ImmediateAnnuities.com were very good also. I knew right away in the application process the MYGA was not at all like buying a CD or bond when they kept asking questions related to "suitability". That was confirmed when the 60 pg contract was delivered. I did try to read it!

I bought a second MYGA from Americo in 4/2022 and a third in 4/23. I took 10% free withdrawals from the 1st two MYGAs to fund the 3rd. Americo "lost" one of the withdrawal checks so there was a delay. Then, it took forever to issue the 3rd contract. This was about the time Americo was no longer displayed on the Blueprint website. I even asked the Blueprint rep if they had dropped Americo but he said "No, they are just swamped". I was
even able to take a free withdrawal on a MYGA contract within the first year. Americo dropped the free withdrawal to 5% for my 3rd contract.

i have another credit union CD that just matured and I am looking at the 5yr Canvas Freedom Fund as I am comfortable with B++. I would prefer an A rated company but I would like to have a rate close to 6%. It is easy for me to justify B++ because the contracts are tiny and I have generally higher rated Fixed Income assets including CDs, bonds and treasuries.

Welcome to the Forum! And thank you for your kind words.

I’m glad to hear that you’ve had an OK experience with Americo. They were removed from the Blueprint website a while back due to continuing service problems, but were later reinstated. I purchased a contract from Americo a few months ago and got good turnaround.

If you’re looking for another new contract, Canvas has just about the highest rates out there. You can also look at Gainbridge.io, and look back at Blueprint Income too.

Thanks for sharing your perspective. Best to you.

I also have an annuity t

[Jazz4cash]

Right now I've been looking at the following options....
Canvass B++ 6.5 for 5 yrs
Clear Spring A- 5.9 for 5 yrs
Gainbridge A- 5.75 for 5 yrs
Americo A- 5.95 for 5 yrs

A bit of an anomaly here. Gainbridge is the direct sales channel for Group 1001 Insurance LLC and Clear Spring is their broker channel product. We've been seeing the direct sales product having higher rates than the broker product (makes sense, right?) but now we have a Clear Spring product with a higher rate than their directs sales cousin. Am I missing something?

[Stinky]

Right now I've been looking at the following options....
Canvass B++ 6.5 for 5 yrs
Clear Spring A- 5.9 for 5 yrs
Gainbridge A- 5.75 for 5 yrs
Americo A- 5.95 for 5 yrs

A bit of an anomaly here. Gainbridge is the direct sales channel for Group 1001 Insurance LLC and Clear Spring is their broker channel product. We've been seeing the direct sales product having higher rates than the broker product (makes sense, right?) but now we have a Clear Spring product with a higher rate than their directs sales cousin. Am I missing something?

Strange stuff.

If you’re going with Gainbridge/Clear Spring, I’d pick the higher rate.

[jimishooch]

FYI,
I'm in the 30 day look back period with the Canvas 3 year. Called in yesterday and requested the rate increase of 6.3%. My account was updated within 24 hours and retroactive to issue date.

[soretired]

FYI,
I'm in the 30 day look back period with the Canvas 3 year. Called in yesterday and requested the rate increase of 6.3%. My account was updated within 24 hours and retroactive to issue date.

Sweet. Kudos to them.

[Stinky]

FYI,
I'm in the 30 day look back period with the Canvas 3 year. Called in yesterday and requested the rate increase of 6.3%. My account was updated within 24 hours and retroactive to issue date.

They did the same thing for me when I purchased from them early this year, and they increased the rate within the month after I purchased. No hassle, no muss, no fuss.

The only hassle that I had was getting them to confirm that rate increase in writing. While the website showed that the rate was increased, the contract still said the original rate. I didn’t want a problem down the road, so I called customer service. Nothing happened. Called again. Nothing happened.

I finally wrote a letter to the president of the company. Within a week or so, there was a letter in the portal confirming the higher rate. That was good enough for me.

[jimishooch]

FYI,
I'm in the 30 day look back period with the Canvas 3 year. Called in yesterday and requested the rate increase of 6.3%. My account was updated within 24 hours and retroactive to issue date.

They did the same thing for me when I purchased from them early this year, and they increased the rate within the month after I purchased. No hassle, no muss, no fuss.

The only hassle that I had was getting them to confirm that rate increase in writing. While the website showed that the rate was increased, the contract still said the original rate. I didn’t want a problem down the road, so I called customer service. Nothing happened. Called again. Nothing happened.

I finally wrote a letter to the president of the company. Within a week or so, there was a letter in the portal confirming the higher rate. That was good enough for me.

Rep did mention confirmation of rate change via email PDF...

[Stinky]

FYI,
I'm in the 30 day look back period with the Canvas 3 year. Called in yesterday and requested the rate increase of 6.3%. My account was updated within 24 hours and retroactive to issue date.

They did the same thing for me when I purchased from them early this year, and they increased the rate within the month after I purchased. No hassle, no muss, no fuss.

The only hassle that I had was getting them to confirm that rate increase in writing. While the website showed that the rate was increased, the contract still said the original rate. I didn’t want a problem down the road, so I called customer service. Nothing happened. Called again. Nothing happened.

I finally wrote a letter to the president of the company. Within a week or so, there was a letter in the portal confirming the higher rate. That was good enough for me.

Rep did mention confirmation of rate change via email PDF...

I’d like to think that my letter to the President drove a procedure change at the company.

But more likely, you just got a better trained rep than the two that I talked to.

Oh well…..