When it comes to retirement planning, there are a lot of options to consider. One important decision you’ll need to make is whether to purchase an annuity. Annuities can be a great way to ensure a steady stream of income in retirement, but not all annuities are created equal. This guide will discuss the three best short-term annuities for your retirement planning needs!
What Is A Short-Term Annuity?
A short-term annuity is a deferred annuity with a surrender charge period of five years or less. This type of annuity can be a great option for someone who wants the security of an annuity but doesn’t want to be locked in for the long term.
The Best 2-Year Annuity
A deferred annuity allows you to grow your money over time while still having access to the funds if you need them. The best 2-year deferred annuity is a multi-year guaranteed annuity (MYGA).
- This annuity offers a guaranteed fixed interest rate, similar to a certificate of deposit, usually higher than a CD rate.
- After the two years are completed, the funds become completely liquid, allowing you to access them if needed.
- Additionally, the annuity provides a death benefit, ensuring that your loved ones will receive the money if you pass away before the maturity date.
With its guaranteed rate and death benefit, the MYGA is an ideal option for those looking for a secure way to grow their money.
The Best 3-Year Annuity
When it comes to annuities, there are many different options to choose from. However, the best 3-year deferred annuity is a fixed annuity.
- A fixed annuity offers a guaranteed interest rate that is similar to a certificate of deposit.
- Additionally, the money in a fixed annuity grows tax-deferred, so you won’t have to pay taxes on the interest until you withdraw the money.
- After the three years are up, the funds in a fixed annuity become completely liquid, which means you can access the money without any penalties.
- Additionally, most fixed annuities come with a death benefit, which ensures that your loved ones will receive the money if you pass away before the maturity date.
Overall, a fixed annuity is a great option for anyone looking for a safe and secure investment with guaranteed returns.
The Best 5-Year Annuity
If you’re looking for a safe investment that will give you a chance to earn some market-based gains, a 5-year deferred annuity is a good option.
- With a fixed indexed annuity, your original investment is protected from loss, but you also have the opportunity to earn interest based on the performance of a stock market index.
- At the end of the five years, the funds become fully liquid, so you can access them if necessary.
- Additionally, the annuity provides a death benefit, which can be useful if you pass away before the maturity date.
Overall, a fixed indexed annuity is a great option for anyone who wants to earn some market-based gains without putting their principal investment at risk.
Next Steps
So, what are the best short-term annuities for retirement planning? Contact us for a quote, and we’ll help you find the right one for your needs. With so many options available, it can be difficult to know where to start. But with our help, you can feel confident that you’re making the best decision for your future. Thanks for reading!
Request A Quote
Get help from a licensed financial professional. This service is free of charge.