The Ways a 5-Year Multi-Year Guaranteed Annuity (MYGA) Benefits You
October 20, 2022
There are many options when choosing your retirement strategy, but a multi-year guaranteed annuity (MYGA) benefits you in plenty of ways. With a 5-year MYGA, you make a short-term commitment to keep those funds secure while receiving a guaranteed return on that fund at the end of the 5-year period. A MYGA has many benefits for those planning for their retirement.
A 5 Year-MYGA
How does a 5-Year MYGA benefit you? Here is an outline of reasons you should consider a 5-Year MYGA.
Safe Solution
An MYGA is a safer investment solution than many of the market-driven funds. You receive a guaranteed rate of return. Ultimately, it means you have an exact idea of how much money you earned during the fund period. If your strategy to retire is based more on long-term, slow fund growth, MYGAs are a consistent, trustworthy solution.
Flexible Options
Unlike some long-term investment funds, you are not without options for accessing your MYGA funds when absolutely necessary. You often pay a surrender fee on the amount you withdraw early, but that isn’t always the case. Many providers permit the withdrawal of a certain percentage of the fund early without penalties. You may also avoid penalties if you withdraw for a a serious medical diagnosis.
Tax Deferral on an MYGA
If you aren’t familiar with the tax deferral rules of retirement funds, it may surprise you to learn that your MYGA funds are exempt from taxes until withdrawal.
No Limits on a MYGA
Many retirement funds come with contribution limits for each year. You may only contribute a certain amount or percentage of your income each year. It can affect your retirement strategy negatively because it limits how much you can save in those funds. You won’t have those restrictions with an MYGA.
When you purchase it through your insurance provider, you determine the amount you wish to invest. The insurance company dictates the rate of return, but you can contribute the amount you see fit. It makes it easier for you to bolster your retirement savings as needed. Remember only to contribute what you can afford to be without for that time period.
An MYGA fund is an ideal means for consistent, reliable retirement fund growth. When your retirement strategy needs stability and guarantees to help offset any risky funds, an MYGA may be the right solution. The plan allows you to earn a return on your money without a long-term commitment, allowing you to re-invest afterward if you’re happy with the fund performance.
About 1891 Financial Life
At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.
Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.