Rajsx wrote: Tue Feb 04, 2025 6:30 pm
...I know what I am getting with the MYGA, there are no coulda, wouda or possibly 100 other factors tied to the returns as with BND.
The answer I know nobody knows, but does my thinking make sense & on the right track ?
Our IRAs are all fixed income, if it is not MYGA or BND it is some other fixed income products, there are no equities in our IRAs, we are retired 68 & 63.
Your opinions please .........
One main question I'd ask is: will an MYGA help you achieve your goal?
I'm not sure what your goal is.
If it's simply to beat BND over the next 3 years, I think the MYGA will do pretty well.
However, if your goal is less about 3 years and more about providing income for the next couple of decades, an MYGA may not be the best choice.
Imagine when 3 years is up and interest rates have dropped a couple points. You'll need to invest your MYGA proceeds into something that has a lower yield than what you could've gotten now. And BND will have performed well in a declining rate environment -- its price will go up, making it more costly to buy back in.
That's just one scenario that could unfold. It focuses one kind of risk: picking a term for your fixed income gives you certainty for the term, but you lower yields may await you when the principal matures.
There are other risks with fixed income investing. Alas, there's no perfect investment that deals with them all well.
Perhaps you have a longer-term plan that you haven't presented here.
If so, make sure your MYGA choice fits in with that plan.
If you don't have a longer-term plan, now is a good time to come up with one.
P.S. If you'd rather not think about that, that's okay too

Make a local optimization now and deal with the longer-term problem later.
(As to the lower or higher rated MYGA, I have no opinion.)