When you’re considering an annuity, the agent will sometimes show you an illustration. This is a table of future values and surrender charges.
If you’re considering buying a multi-year guaranteed annuity (MYGA), the illustration is usually straightforward. It will show only guaranteed values because there are no variables, except perhaps for market-value-adjustment penalties for excessive withdrawals during the surrender period. Also called a fixed-rate or a CD-type annuity, a MYGA guarantees a fixed interest rate for a term — for instance, 5.95% annually for five years (as of July 2024).
