Annuity guide
Annuity rates by type and term
Annuity rates change weekly and differ by state, deposit size and insurer, so a single 'best rate' figure is misleading. What follows is a dated snapshot of the ranges we have verified for each product type, with the questions that decide whether a headline rate is actually a good deal for you.
Last updated September 19, 2026 · Reviewed against our editorial methodology
Rate snapshot
| Product | Typical range | What the number means |
|---|---|---|
| Fixed / MYGA, 2–10 years | 4.00% – 6.00% | Guaranteed annual interest for the whole term |
| Fixed index annuity, S&P 500 annual cap | 8% – 11% | Maximum credited interest in a positive index year |
| Fixed index annuity, participation rate | 40% – 90% | Share of index gain credited, often with a spread |
| Immediate annuity, age 65 single life | 7.0% – 7.8% | Annual income as a % of premium — includes your capital |
| Variable annuity | No rate | Return depends on subaccount performance minus fees |
Fixed (MYGA) rates by term
A multi-year guaranteed annuity locks one rate for the whole term, which makes it the easiest annuity to compare — see our fixed annuity guide for the mechanics.
| Term | Competitive range | Top of market | $100,000 grows to |
|---|---|---|---|
| 2 years | 4.10% – 4.90% | ~5.15% | $110,560 at 5.15% |
| 3 years | 4.30% – 5.30% | ~5.60% | $117,760 at 5.60% |
| 5 years | 4.50% – 5.60% | ~5.85% | $132,860 at 5.85% |
| 7 years | 4.55% – 5.65% | ~5.90% | $149,660 at 5.90% |
| 10 years | 4.40% – 5.50% | ~5.75% | $174,340 at 5.75% |
Notice that ten years does not pay the most. When the yield curve is flat, the three-to-seven year range is often the sweet spot — committing for a decade to earn less than a five-year contract is a common and avoidable mistake.
Fixed index annuity caps
Index annuities do not have a rate in the same sense. The cap, participation rate and spread together decide what you are credited, and the insurer can usually reset them annually within contractual limits. Details in our fixed index annuity guide.
| Crediting design | Typical current terms | What to check |
|---|---|---|
| S&P 500 annual point-to-point, capped | 8% – 11% cap | The guaranteed minimum cap, not just today's |
| S&P 500 annual point-to-point, participation | 40% – 70%, sometimes with a 1%–3% spread | Whether a spread applies on top |
| Proprietary volatility-controlled index | 100% – 150% participation, often uncapped | The index's own expected return and live track record |
| Two-year point-to-point | Higher cap, no credit in between | What happens if you surrender mid-period |
| Declared fixed account inside the FIA | 3.00% – 4.50% | Useful as a floor comparison against a MYGA |
Immediate annuity payout rates
A payout rate is not an interest rate. Most of an immediate annuity payment in the early years is your own premium coming back — see immediate annuities. Illustrative single-life, level, no-refund quotes on $100,000:
| Age | Monthly income | Annual payout rate |
|---|---|---|
| 60 | $525 – $585 | 6.3% – 7.0% |
| 65 | $580 – $650 | 7.0% – 7.8% |
| 70 | $650 – $730 | 7.8% – 8.8% |
| 75 | $790 – $900 | 9.5% – 10.8% |
| 80 | $960 – $1,100 | 11.5% – 13.2% |
Model your own figures with the annuity payout calculator, then collect live quotes.
Comparing rates fairly
- Compare like maturities. A five-year MYGA belongs next to a five-year CD and a five-year Treasury, not next to a ten-year contract.
- Adjust for tax. MYGA interest is deferred; CD and Treasury interest is taxed annually. In a high bracket, deferral can be worth a meaningful part of a percentage point.
- Never compare a cap with a rate. An 11% cap is not an 11% return — it is the most you can be credited in a good year, and 0% is the floor in a bad one.
- Never compare a payout rate with a rate. A 12% payout rate at 80 mostly returns your own money.
What moves annuity rates
Insurers back these contracts with bonds, so the rates they can offer follow the bond market and the Federal Reserve's effect on it. Practically:
- Rising Treasury and investment-grade corporate yields lift MYGA rates within weeks.
- Index annuity caps rise with yields too, because a higher bond yield gives the insurer a bigger budget for the options that fund index crediting.
- Immediate annuity payouts rise with yields as well, and separately with your age. A quote locked at high yields keeps paying at that level for life.
- Credit spreads and competition matter at the margin, which is why smaller insurers frequently top the tables.
Why the top rate isn't always the best deal
- Free withdrawal allowance. A 5.85% contract allowing nothing out for five years may serve you worse than a 5.60% contract allowing 10% a year.
- Market value adjustment. Check whether early surrender is adjusted for rate moves, and in which direction.
- Issuer strength. Prefer AM Best A- or better, and keep each contract within your state guaranty limit.
- Renewal behaviour. If it is not a true multi-year guarantee, ask for the guaranteed minimum and the renewal history.
- State availability. Many top-of-table products are not filed in every state, notably New York.
Rate-shopping checklist
- Decide the term you can genuinely commit to.
- Collect at least three current quotes for that exact term.
- Confirm the rate is guaranteed for the full term in writing.
- Read the surrender schedule, the free withdrawal allowance and any MVA.
- Check the issuer's rating and your state's guaranty limit.
- Compare against a same-maturity CD and Treasury on an after-tax basis.
- Diary the maturity date so a poor auto-renewal never happens by default.
Frequently asked questions
- What are the best annuity rates right now?
- Multi-year guaranteed annuities have recently topped out in the mid-5% to low-6% range for terms of three to seven years, with the highest rates generally offered by smaller insurers. Because rate sheets change weekly and vary by state, treat any single published figure as a starting point and confirm with a current quote.
- Which annuity gives the highest rate?
- Among principal-protected products, a multi-year guaranteed annuity usually offers the highest stated rate. Immediate annuities show higher headline payout rates — 7% to 12% a year — but those include the return of your own capital, so they are not comparable to an interest rate.
- Are annuity rates going up or down?
- Annuity rates track bond yields rather than the stock market. When Treasury and investment-grade corporate yields rise, fixed annuity rates and index annuity caps follow within weeks; when yields fall, they are cut. Watching the 5- and 10-year Treasury yield is a good proxy.
- Does a bigger deposit get a better annuity rate?
- Often yes. Many insurers publish a rate band with a bonus at a threshold, commonly $100,000. The difference is typically 0.1 to 0.35 percentage points, so it is worth asking whether crossing a band changes your quote.
- Is a 6% annuity rate good?
- For a multi-year guaranteed annuity it is at the strong end of what has been available recently, and it is worth checking why — usually a longer term, a smaller insurer, or a strict withdrawal allowance. Compare it against a Treasury or CD of the same maturity, and check the issuer's rating before committing.
Sources
- Insurer published rate sheets and multi-insurer annuity quoting services, checked at the date shown at the top of this page.
- U.S. Department of the Treasury — daily Treasury par yield curve rates (for comparison maturities).
- AM Best — financial strength ratings.
- National Organization of Life & Health Insurance Guaranty Associations — state coverage limits.
- FINRA and SEC Investor.gov — annuity fee, cap and surrender charge disclosure guidance.