Annuity rates are the percentage your annuity grows each and every year. Whether you’re still in the planning stages or have just recently retired, you’re probably concerned about being able to cover your living, healthcare, and medical expenses. You’ve also probably had many sleepless nights worrying whether you’re going to outlive your savings or not.

While all retirement concerns are valid, there might be a rare one-fix solution to put your mind at ease. And, it’s through an annuity. The key is finding the right annuity for you.

One of the most important decisions you need to make when choosing a variable annuity is which provider to buy it from. Variable annuities are contracts between you and an insurance company, and the quality of the contract depends largely on the financial strength, reputation, and customer service of the provider. Different providers may also offer different features, fees, and investment options for their variable annuities, so it is essential to compare them carefully before making a purchase.

Below, we will discuss some of the factors you should consider when comparing variable annuity providers, and how to find the best one for your needs.

Some of the factors you should consider when comparing variable annuity providers are:

1. Financial ratings. The financial ratings of an insurance company reflect its ability to meet its obligations to policyholders, such as paying out annuity income and death benefits. You can check the ratings of an insurance company from independent rating agencies such as A.M. Best, Standard & Poor’s, Moody’s, and Fitch. You should look for providers that have high ratings, such as A or above, from multiple agencies. This indicates that they have a strong financial position and a low risk of defaulting on their promises.

2. Fees and charges. Variable annuities typically have various fees and charges that can reduce your returns and income. These may include mortality and expense risk charges, administrative fees, surrender charges, investment management fees, rider fees, and sales commissions. You should compare the fees and charges of different providers and look for ones that have low or no fees. You should also be aware of any hidden fees or penalties that may apply if you withdraw money early, switch providers, or cancel your contract.

3. Investment options. Variable annuities allow you to invest your money in a range of subaccounts, which are similar to mutual funds. The performance of your variable annuity depends largely on the performance of the subaccounts you choose. Different providers may offer different subaccounts, with different investment objectives, strategies, risks, and costs. You should compare the investment options of different providers and look for ones that match your risk tolerance, time horizon, and goals. You should also consider the diversification, performance, and fees of the subaccounts.

4. Income options. Variable annuities offer various income options, such as lifetime income, joint and survivor income, period certain income, and income with a guaranteed minimum. Different providers may offer different income options, with different payout rates, guarantees, and features. You should compare the income options of different providers and look for ones that suit your income needs and preferences. You should also consider the impact of inflation, taxes, and market fluctuations on your income.

5. Riders and benefits. Variable annuities may also offer optional riders and benefits, such as death benefits, living benefits, withdrawal benefits, and annuitization benefits. These riders and benefits provide additional protection and flexibility for your variable annuity, but they also come with additional fees and restrictions. You should compare the riders and benefits of different providers and look for ones that add value to your variable annuity. You should also understand the terms and conditions of the riders and benefits, and how they affect your fees and income.

Comparing variable annuity providers can be a complex and time-consuming process, but it is worth the effort. By doing your research and shopping around, you can find the best provider for your variable annuity, and enjoy the benefits of customized investment and income options.

Find the Right Annuity Provider for Your Retirement

Annuities are insurance contracts. They provide a guaranteed lifetime income and protection against losing your initial investment. You may be able to use an annuity to assist you with your long-term costs too. And, you can leave the balance to heirs.

Read Also: Fees and Charges: The Hidden Costs of Variable Annuities

Unfortunately, many people aren’t taking advantage of annuities. Maybe it’s because they’re overwhelmed by them — or overwhelmed by all things about retirement. And, that’s a fair point. After all, annuities come in a variety of flavors — just like ice cream.

For starters, annuity rates can be either immediate (begin paying out now) or deferred (being paid out at a later date). Additionally, they might fall into the following annuity types;

• Fixed annuities promise to pay you a guaranteed interest on your contributions. Rates are often based on the current interest environment. Overall, a fixed annuity is the most straightforward and predictable. 
• Fixed indexed income annuities also offer principal protection like a traditional fixed annuity. However, there is upside potential through index participation (such as S&P 500). Principal protection and growth.
• Multi-year guaranteed annuities (MYGA) offer a fixed rate of return but for a specified period of time.  
• Variable annuities are tied to an investment portfolio. So, payments can increase when the market is performing well and decrease when it’s not. You can expect higher returns, but there’s more risk involved. 
• Registered index-linked annuities are relatively new and are tied to the stock market index. Gains are capped and losses are limited.

Are you feeling comfortable enough with annuities now that you want to buy one? If so, you’ll want to keep the following in mind so that you’ll get the most out of the annuity.

Pick the right type of annuity for you.

If you’re allergic to peanuts, then you should stay far away from peanut butter ice cream. It’s kind of the same thing with annuities. If you’re already in retirement, then a deferred variable annuity probably doesn’t make much sense. Select the annuity that best aligns with your retirement plan and doesn’t exceed your risk threshold. 

Check the annuity rates and terms.

Before committing to a contract, carefully review the rates and terms. It should be clearly stated when you can access your money, how much you’ll be receiving, and the fees associated with the annuity. For example, if you withdraw any money before you’re permitted, you’ll be subject to surrender charges. 

Choose your salesperson wisely.

Since your broker has to put food on the table, they’ll earn a commission from annuity sales. Often, these costs aren’t disclosed. Find out how much they’re making off the sale. And, more importantly, they’re not selling the wrong annuity just to cash in on a commission. 

Select a financially strong insurance company.

Annuities aren’t backed by institutions like the FDIC. They’re also supposed to last you a lifetime. As such, you need to make sure that you’re working with an insurance company that’s in it for the long haul. You can make sure that they’ve received a high rating from third parties like A.M. Best, Moody’s, Standard & Poor’s (S&P), and/or Fitch, etc.

Some other considerations? How easy it is to sign up and fund the annuity, as well as access your money. Customer service and what you expect your payments to be should also be factored in. Also, look at the interest rates for payout.

But, since your time is valuable, we’ve gone ahead and listed the 25 best annuities that you should purchase. Each has met the criteria above. And, we’ve even broken the list down into the best fixed, fixed indexed growth, MYGA, variable, and registered index-linked annuities so that you can quickly find the right type of annuity for you.

Top Annuity Rates

1. Due Fixed Annuity

When it comes to fixed annuities, Due has quickly established itself as a market leader. Founded by entrepreneur serial and annuity expert John Rampton, the company has already secured over 12,000 registered users. Those who sign up for a Due account can anticipate a guaranteed annuity rate of 3% return. And, on average, users are receiving $2,100 in retirement income per month.

But what makes Due the nation’s top retirement app? Easy. It’s incredibly accessible and easy to understand.

Due was designed for the average person to finally grab a piece of that guaranteed income ice cream cake. As such, it’s one of the most straightforward and transparent annuities on the market. And, here’s how it works. Just apply for a Due account. Don’t worry. It’s free and will take you under 10 minutes. Once you’re set-up, you’ll get 3% on every dollar deposited.

And, if you’re uncertain on how much you’ll need to save each month, there’s also a handy annuity calculator to determine this amount. And, all of your hard money is deposited into a Charles Schwab account. It’s then managed by Blackstone (NYSE: BX), and ATHOS Private Wealth. If you’re unaware, both have impeccable reputations as two of the best investment firms in the country.

2. American National Single Premium Immediate Annuity (SPIA)

Since 1905, American National has been providing insurance products and services, including annuities. The company has three annuity options; a fixed deferred annuity, index deferred annuity and an SPIA.

Because American National has an A rating from A.M. Best you can be certain that the company is financially strong and will be sticking around. That makes all of their offerings appealing. But, their SPIA is the superstar of the bunch.

With this annuity, you can convert a lump sum of money into a predictable income stream. In fact, a “joint life” option has an average annual income of $10,609 and an annual payout rate of 5.30% — but it changes with what the current percentages are at the time of payout. You can spread this income out over a number of years, making your taxes more manageable, and there are several cash-out options. That makes it easier to withdraw your money in case there’s an emergency — but as with all annuities, there are fees with early withdrawal.

3. CUNA Mutual Group MaxProtect Fixed Annuity

Issued by the CMFG Life Insurance Company, the MaxProtect Fixed Annuity offers a guaranteed and competitive rate. That means you don’t have to sweat market volatility. But, at the same time, your annuity will grow faster than other taxable investments like CDs.

CUNA also gives you the option to lock in your interest rate for 3, 5 or 7 years. Afterward, you have several options to turn your savings into a series of income payments. And, there are no contract, administrative or upfront fees.

A.M. Best rated CUNA “A,” Standard & Poor’s (S&P) gave it an “A+” and Moody’s gave it an “A2.” That means you should have no concerns over CUNA’s financial future.

4. New York Life Secure Term Choice Fixed Annuity II

In general, you can’t go wrong with any New York Life annuity. After all, the company has a long and rich history dating back to 1845. It also has an A++ from A.M. Best, and has been the top provider of fixed deferred annuities since 2010. The company has also received the highest score among individual annuity providers in customer service by J.D. Power.

But, we’ve selected the New York Life Secure Term Choice Fixed Annuity II as our favorite annuity offering from the company. It requires a $5,000 premium amount to begin, but there aren’t any annual charges. Annuity rates are subject to and depend on the length of the contract, but the Guaranteed Minimum Interest Rate (GMIR) is 0.05% (except in New York where it is 1%). And, you also have the option to go with a 3, 4, 5, 6, or 7-year policy.

5. American Equity GuaranteeShield

Online reviews for American Equity have noted that American Equity delivers outstanding customer service. And, as far as financial strength goes, it’s earned an A- (Excellent) from A.M. Best. Furthermore, the company has several different annuity options.

For our money, though, we like the GuaranteeShield series. It checks all the boxes for a fixed annuity, including;

• Principal protection
• Guaranteed income
• Tax-deferred growth
• Liquidity
• May avoid probate

You can also access up to 10% of your contract’s value each year and add on a market value adjustment and death benefit rider. Interest rates may vary each contract year. But, the GMIR will never drop below 1%.

Top Fixed Indexed Growth Annuities

6. AIG – Assured Edge Income Builder

With the Assured Edge Income Builder from AIG, you can reap the benefits of a fixed annuity. Additionally, your guaranteed lifetime income amount (GLIA) will increase based on a 7% income growth rate each year until you begin receiving payments. And, according to the company, the annual income credit is a dollar amount calculated by multiplying the initial GLIA by the 7% income growth rate.

But, there are a couple of other features that make this a highly coveted annuity. There’s also a market value adjustment and a flexible guaranteed withdrawal benefit (GLWB). For example, being able to take multiple withdrawals of up to 10% of your contract value as of the previous anniversary, with no withdrawal charge or market value adjustment (MVA).

You’ll need a $25,000 minimum deposit. And, you should also know that AIG has received an A from A.M. Best, A2 from Moody’s, A+ from S&P, and A+ from Fitch.

7. Nationwide – New Heights 9

Going back to 1926, Nationwide offers insurance, retirement, and annuity products. What makes Nationwide a top annuity company is that its products are flexible. For example, you can purchase a premium through a series of payments or just one lump sum.

In particular, the company’s New Heights 9 Fixed Indexed Annuity deserves a shoutout. As stated on the company’s site, “New Heights 9 tracks your potential strategy earnings also known as earnings, daily, and does not limit the amount of index performance used to calculate your earnings.” You also might be able to snag higher long-term accumulation depending on the performance of the underlying index and declared percentage or rate component.

Additionally, your money is protected from potential market risk. And, you can also tack on optional riders. One such rider worth considering is guaranteeing a lifetime income for you, your spouse, or heirs.

Additionally, Nationwide has landed high financial ratings. A.M. Best rated it an A+ (Superior), S&P gave it an A+ (Extremely Strong), and Moody’s rated it an A1 (Upper-Medium Grade).

8. Protective Indexed Annuity II

Protective has been in business since 1907. And, throughout the years they’ve garnered an A+ rating from A.M. Best, AA- from S&P, A1 from Moody’s, and A+ from Fitch. They also just so happen to be one of the top-selling registered-index-linked companies.

With that in mind, we would be remiss if we didn’t mention its Indexed Annuity II. The company promises protection on your principal, a lifetime stream of guaranteed income, and the potential for higher growth based on the performance of the S&P 500 Index. One of the most appealing features, however, is that you’re able to access your money penalty-free if you become unemployed, terminally ill, or have to relocate to a nursing facility.

There’s a $10,000 minimum. But, you don’t have to be concerned with an annual contract fee.

9. Global Atlantic ForeIncome II

Global Atlantic offers several different annuity products including a fixed, variable, income, or fixed index annuity. And, it’s the latter that we want to focus on.

It turns out the Global Atlantic has five different fixed index annuities, FIAs for short. The purpose of these is that you’ll have greater growth potential than traditional deposit products, tax-deferred growth, and no market losses. Also, you can pass the balance on to your beneficiaries.

Specifically, the ForeIncome II stands out the most. It aims to provide you with a “retirement paycheck” for life. And, this is an extra income that you can’t outlive. What’s more, you have two withdrawal options;

• The Guaranteed Income Builder Benefit offers a steady, predictable income for your entire life. 
• The Income Multiplier Benefit provides a steady income, but it grows by being tied to the S&P 500.

And, there’s no need to stress over Global Atlantic’s financial strength. The company has earned an A from A.M. Best, Fitch, and Moody’s, along with an A- from Standard & Poor’s.

10. Lincoln Financial OptiBlend

Lincoln Financial has been in existence since 1905. The company offers a wide range of products including annuities, life insurance, retirement plan services, and group protection. But, obviously, we want to highlight the company’s annuities — specifically the Lincoln OptiBlend.

This is a fixed-indexed annuity. It has flexible premium annuities and offers a set interest rate for one year. Interest rates are declared annually. Another key feature includes a 5-year, 7-year or 10-year surrender charge schedule.

But, the standout is that your portfolio is tied to the performance of four different indexed accounts; the 1 Year Fidelity AIM Dividend Participation, 1 Year S&P 500 5% Daily Risk Control Spread, 1 Year S&P 500 Cap, and 1 Year S&P 500 Participation.

There’s a $10,000 minimum. But, no annual contract fees.

Finally

Overall, while variable annuities can be an excellent investment option for certain people, it is critical to carefully weigh all aspects of this form of investment before making a decision. You may make an informed decision that is consistent with your financial condition and goals by considering your risk tolerance, investment goals, fees, and understanding the constraints.