Disclaimer: Interest rates change often. This article will be updated on a quarterly basis, but rates may change between those updates. At any time, you can review current annuity rates here, and you can download our 5-Year Annuity Tip Sheet, which is updated regularly, here.
Not much has changed since last quarter, and I'm honestly very thankful to be saying that. In our world, steady is great news. We're in a nice place right now, especially just learning that Equitable is holding their rates for another month.
A lot of agents have been asking me... "are those tip sheets still up-to-date?" Because some say February as the last update, but it's true – nothing has changed. It's great news.
Last quarter, I mentioned that annuity interest rates are the highest they've been for well over 5 years, and that's thankfully still the case today.
What's Hot Right Now In 5-Year MYGAs
The product I'm seeing come across my desk the most from agents right now is Equitable's 5-year MYGA. Last quarter, it was Sentinel, and that has shifted a little bit over to Equitable, though both are still hot right now.
The Equitable 5-year plan is at 4%, and it's probably the frontrunner for all the volume we get. It has the 5% free withdrawal after Year 1 included. You can also get your interest after 30 days. You also get full account value at death, and it's RMD-friendly.
That's a lot of extras that are included in a 4% rate for 5 years.
Our second most popular 5-year right now is Sentinel, which is also at 4%, but they have some rider deductions. It's basically a la carte. If you want a 10% free withdrawal, you take off .08%.
I will point out that when you compare the .08% deduction to no deduction, it's really not much of a difference:
|4% Interest Rate||3.92% Interest Rate|
|$2,000 earned in year 1||$1,960 earned in year 1|
With Sentinel, you also don't have to do the suitability, which saves the agent a lot of time and headache. Sentinel also has the e-app, which is another plus.
The third one would be Atlantic Coast Life. It's the same rate, even though they pay 4.8% in Year 1, they pay 3.8% in Years 2-5. So that averages out to 4% as well.
They also have the same rider deductions as an a la carte option.
So those are the big 3 right now – Equitable, Sentinel, and Atlantic Coast Life.
When we talk about MYGAs that are less than 5 years, there are two that immediately come to mind as being very popular and competitive.
The first is from Liberty Bankers Life with the Banker's Elite 3, which is now at a 3.05% interest rate. There are no withdrawal features with this one, though. You have to keep your money in there for the 3 years.
It's a pretty high comp, too – the comp is comparable to a 5-year MYGA even though it's a 3-year.
Secondly, Equitable has a 2-year plan at 2.85%. Sometimes, people don't want to get too far down the road, you know? This is a great option for them.
Investor's Heritage Update
Investor's Heritage was one of the top options last quarter, but they've fallen off for now as they're lowered their rate from 4% to 3.5%.
They had more volume than they knew what to do with, and the best way to decrease volume is to lower your interest rate.
It's too hard to predict... more than anything, we're just thankful that we have such great rates for our clients. For seniors who want to stabilize, this is hard to beat.
Just as a little reminder, make sure you're asking those additional questions. It all goes back to the CNA.
If they have money in the turbulent market and want to steady the ship, that's a MYGA sale. In the bank accumulating no interest? Let's explore.