MYGAs vs. Fixed Annuities

There are many types of fixed annuities and each has their own unique benefits and limitations specific to that product strategy. Multi-Year Guarantee Annuities (MYGAs), Single Premium Immediate Annuities (SPIAs), Deferred Income Annuities (DIAs), Qualified Longevity Annuity Contracts (QLACs), and Fixed Index Annuities (FIAs) all are fixed annuities.

Multi-Year Guarantee Annuities (MYGAs) are the annuity industry's version of a CD.  No annual fees.  No moving parts.  MYGAs guarantee an annual percentage growth for a specific period of time that you choose.  In a non-IRA account, MYGAs grow tax-deferred.

Single Premium Immediate Annuities (SPIAs) are personal pension products that were first  introduced in the Roman Times.  SPIA income is primarily based on your life expectancy at the time payments start, with interest rates playing a secondary role.  Income can start as soon as 30 days from the policy issue date up to a 1 year deferral.

Deferred Income Annuities (DIAs) are the same structure as a SPIA, but the income can start as early as 13 months from the contract issue date to as far out as over 40 years.

Qualified Longevity Annuity Contracts (QLACs) are the same structure as a DIA, but can only be used with qualified funds...like your Traditional IRA or 401k.  You can add a spouse or partner for joint lifetime income, and QLACs have the potential to lower taxes on your RMDs (Required Minimum Distributions).

Fixed Index Annuities (FIAs) are principal protection products that produce CD (Certificate of Deposit) type returns.  Income Rider guarantees can be added to FIA policies at the time of application.

You can contact Stan if you have any questions or want to see quotes on your specific situation.

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