Our Equitable Guaranteed Growth Strategies Annuity Review (Overall)
Equitable Guaranteed Growth Strategies is a multi-year guaranteed annuity (MYGA) that locks in a fixed interest rate for three, five, or seven years. It offers first-year access to a portion of your money and an option to withdraw the interest credited each month.
We like this annuity’s first-year liquidity and the fact that it does not automatically start another multiyear surrender schedule after the initial term. But we would not buy it based on the Equitable name alone. If another strong insurance company pays more for the same term and offers the access you need, why settle for less?
- Insurance company: Equitable Financial Life Insurance Company of America
- Product type: Single-premium fixed annuity
- Initial guarantee periods: Three, five, or seven years
- Minimum deposit: Generally $25,000
- First-year access: Generally up to 10% of your deposit without a withdrawal charge, subject to contract rules
- Early access adjustment: A market value adjustment may apply to withdrawals above the free amount during the initial guarantee period
- After the initial term: The contract renews into a one-year guarantee period with a newly declared rate
Equitable Guaranteed Growth Strategies Annuity Alternatives
Not all fixed annuities pay the same interest or offer the same access to your money. Compare Equitable with the best annuities, fill out the form below, or call us at (770) 755-1565 for a free comparison.
Our Professional Opinion on Equitable Guaranteed Growth Strategies
Equitable Guaranteed Growth Strategies is a straightforward fixed annuity with some features we actually like. The interest rate is guaranteed for the term you choose, and you can generally take a limited withdrawal in the first year. Some MYGAs make you wait for ordinary penalty-free access, so that flexibility is useful.
We also like what happens when the initial guarantee ends. The contract renews annually rather than automatically putting you into another three-, five-, or seven-year surrender schedule. You can reassess the rate and decide what to do with your money without worrying that you missed a short window and got stuck in another multiyear commitment.
But the rate still has to compete. We would not accept a lousy rate just because Equitable is a recognizable name. Compare the guaranteed interest, the term, and the withdrawal rules with other strong companies before choosing it. The 3-year option is particularly unforgiving if you need more than the free amount early: its standard withdrawal charge remains the same in all three years.
Equitable Financial Life Insurance Company of America is a good annuity company with an A (Excellent) financial strength rating from AM Best. The rating is under review with developing implications; that is not a downgrade. Its rating meets our standard, but we would still compare the actual offer with other financially strong insurers.
If you want to take the interest to cover living expenses, compare a guaranteed lifetime withdrawal benefit before making that decision. A fixed interest check is not a paycheck guaranteed to last for life.
What We Like
- Fixed interest for a choice of terms: You know the initial rate for three, five, or seven years.
- First-year free withdrawals: You do not have to wait until year two to access a limited amount under the contract rules.
- No new multiyear surrender schedule at renewal: After the original term, the contract renews annually.
- Interest income option: You can arrange withdrawals based on interest credited in the prior month.
- Health waivers: Qualifying confinement or terminal illness may let you access more of your money without the usual withdrawal charge or MVA.
What We Don’t Like
- A tough three-year surrender schedule: The standard charge does not decline during that term. That stinks if you have to get out early.
- An MVA can reduce an early payout: A withdrawal over the free amount can be affected by interest-rate changes as well as a withdrawal charge.
- The original interest rate does not last forever: The annually declared rate after the initial term could be lower.
- Interest withdrawals are not guaranteed lifetime income: Your rate and available interest can change after the first term.
- The income you spend is not compounding: Taking interest out can be useful, but do not expect the same account growth as leaving it in.
How Equitable Guaranteed Growth Strategies Works
You make one deposit and choose an initial guarantee period of three, five, or seven years. Equitable declares your fixed interest rate when the contract is issued and guarantees it for that initial period. Interest is credited daily, and money you leave in the account can earn additional interest over time.
There is no index to track and no cap or participation rate to figure out. For someone who wants to know the interest rate in advance, that simplicity is a real advantage. Your choice is not just about the rate, though. Pick a term you can live with if you need access to more than the free withdrawal amount.
Equitable offers different initial rate bands based on the deposit. When you compare quotes, use the actual amount you plan to put in the contract. A rate available for a larger deposit does not necessarily apply to a smaller one.
Compare Equitable With Other Fixed Annuity Rates
We would compare Equitable against other fixed annuities for the same term and deposit, starting with insurers rated A− or higher by AM Best. A slightly higher rate is not the whole story if you need first-year withdrawals or dislike the MVA. Compare the complete package, then choose the best offer for the job.
Withdrawals: How Much Can You Take Out?
In the first contract year, you can generally withdraw up to 10% of the original deposit without a withdrawal charge. In later years of the initial guarantee, the free amount is generally based on 10% of the account value at the beginning of that contract year. Amounts already taken reduce the remaining allowance for that year.
You can also arrange systematic withdrawals or elect the Interest Income Plan, which pays an amount based on interest credited in the previous contract month. The plan does not turn interest into a lifetime income guarantee. Withdrawal minimums, available amounts, and contract rules apply.
If You Plan to Take Withdrawals
If you plan to live off the interest, compare the actual guaranteed paycheck from an annuity with a guaranteed lifetime withdrawal benefit. Equitable’s fixed rate eventually resets; a qualifying lifetime withdrawal benefit is designed to keep paying under its terms even if permitted withdrawals exhaust the account.
If you want withdrawals but do not need income guaranteed for life, compare an annuity that adds a bonus to the account up front. A larger starting balance may help offset withdrawals and provide more money to compound, even with a lower interest rate. It is not automatically better, so compare the actual contract terms and projected account values.
If you are in poor health or planning for a shorter retirement, compare an annuity with a bonus that is available to your beneficiaries at death. An up-front or vested death benefit may leave your family more than a fixed rate that has had little time to grow. Check the death-benefit, vesting, and withdrawal rules before assuming the bonus will be paid.
Surrender Charges
Take more than the available free amount during the initial guarantee period and a withdrawal charge may apply. The standard schedules are shown below; state and contract variations may apply.
| Contract year | 3-year term | 5-year term | 7-year term |
|---|---|---|---|
| 1 | 7% | 7% | 7% |
| 2 | 7% | 7% | 7% |
| 3 | 7% | 7% | 7% |
| 4 | 0% | 6% | 6% |
| 5 | 0% | 5% | 5% |
| 6 | 0% | 0% | 4% |
| 7 | 0% | 0% | 3% |
| After initial term | 0% | 0% | 0% |
The three-year schedule is our biggest complaint. A 7% charge in each of the three years is not a minor detail if your plans change. Keep your emergency fund somewhere else.
Market Value Adjustment
Equitable applies a market value adjustment (MVA) to certain withdrawals during the initial guarantee period. For a partial withdrawal, it generally applies to the amount above the remaining free allowance. It can increase or decrease what you receive, and a withdrawal charge can also apply.
The MVA applies during the initial guarantee period, not the later annual renewal periods. Ask Equitable for the actual amount you would receive before taking a large withdrawal or moving the annuity.
What Happens After the Initial Guarantee?
After the three-, five-, or seven-year guarantee, the contract automatically renews into a one-year guarantee period. Equitable declares the renewal rate, and it can be higher or lower than the original rate, subject to the contract’s guaranteed minimum.
We like the annual renewal design because the original withdrawal charge and MVA periods end with the initial guarantee. But do not ignore the renewal notice. Compare the new rate with what other strong insurers offer and decide whether to keep the annuity or move your money. There is no prize for leaving it in a lousy renewal rate out of habit.
Required Minimum Distributions and Health Waivers
A required minimum distribution from this contract, calculated by Equitable and taken through its Automatic RMD Withdrawal Service, is not subject to a withdrawal charge under the applicable rules. Do not assume every withdrawal labeled an RMD gets identical treatment; confirm how the service and any MVA apply to your request.
The contract can also waive withdrawal charges and the MVA for qualifying nursing home or hospital confinement, or a qualifying terminal illness. The confinement provision requires the specified consecutive period, and other contract and state conditions apply. These waivers give access to your money; they do not create a separate pool of long-term care insurance benefits.
What Happens When You Die?
The death benefit is generally the greater of the account value or the contract’s nonforfeiture value when Equitable receives the required beneficiary information. Withdrawals you took while alive reduce the amount left in the account. Your beneficiaries should understand their available payout choices under the contract.
If your spouse is your beneficiary, ask whether spousal continuation is available and how it affects the interest guarantee and access to the money.
Pros and Cons Compared With Other Annuities
- Compared with other MYGAs: First-year access and annual renewal after the initial term are features we like. Another contract may pay a better fixed rate, have a shorter surrender schedule, or avoid an MVA.
- Compared with a fixed indexed annuity: Equitable locks in its initial interest rate. A fixed indexed annuity offers index-linked interest potential, which may be higher or lower, and may offer a lifetime withdrawal rider for an additional charge.
- Compared with a RILA: A registered index-linked annuity can expose your account to market losses beyond its buffer or floor. We think taking that risk while accepting limits on upside is a lousy trade when protecting savings is the priority.
- Compared with a variable annuity: A variable annuity offers investment choices that can rise or fall. Equitable’s fixed annuity provides a guaranteed initial rate rather than direct investment gains and losses.
Who Should Consider Equitable Guaranteed Growth Strategies?
We would consider it for someone who wants a fixed rate for three, five, or seven years, values first-year access, and gets a competitive quote from Equitable. The one-year renewal design is useful if you want to reassess the annuity after the initial term.
We would look elsewhere if a stronger insurer offers a better rate and comparable access, if you cannot tolerate an MVA, or if you may need most of the money before the initial term ends. If your priority is a paycheck for life, compare the guaranteed income available through a lifetime withdrawal rider instead of assuming interest withdrawals will do the same job.
What We Recommend
Equitable has built a MYGA with useful liquidity and a renewal feature we like. Whether it deserves your money comes down to the actual rate and how well the term fits your plans. Compare it with other strong insurers before committing, and do not ignore that stubborn three-year surrender schedule.
Contact The Annuity Expert for a free, no-obligation comparison. We can compare fixed rates, withdrawal options, and guaranteed lifetime income based on what you want your money to do. Call (770) 755-1565 or use the form below.
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