What is a Deferred Fixed Annuity?

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

What is a Deferred Fixed Annuity?

A deferred fixed annuity, also known as a Multi-Year Guaranteed Annuity (MYGA), is a type of annuity contract that guarantees a fixed interest rate for a set period. It’s an investment vehicle primarily used for retirement planning.

Our retirement calculator can guide your long-term financial planning.

Key Features of Deferred Fixed Annuities

  • Guaranteed Interest Rate: MYGAs offer a fixed interest rate for a specified period, usually ranging from 3 to 10 years.
  • Tax Deferral: The interest earned is tax-deferred until withdrawals are made.
  • Withdrawal Penalties: Early withdrawals may result in penalties.


  1. 5-Year MYGA: Offers a fixed 3% interest rate for 5 years.
  2. 10-Year MYGA: Guarantees a 4% interest rate for 10 years.

Deferred Fixed Indexed Annuity

This is a variant of the deferred annuity. It differs in that its returns are tied to a stock market index, like the S&P 500, but still offers some guarantees.

Key Features

  • Linked to a Market Index: Returns are based on the performance of a specific index.
  • Downside Protection: Offers a guaranteed minimum interest rate, protecting against market downturns.
  • Growth Potential: Provides potential for higher returns than MYGA, based on market performance.

Secure your future with precise calculations from our annuity income calculator.

Comparison Table

FeatureDeferred Fixed Annuity (MYGA)Deferred Fixed Indexed Annuity
Interest RateGuaranteed Fixed RateLinked to Market Index, with Minimum Guarantee
Risk LevelLowModerate
Potential ReturnLower, StableHigher, Variable
Suitable forRisk-averse InvestorsInvestors Seeking Balance between Risk and Return


Deferred fixed annuities and deferred fixed indexed annuities offer different approaches to retirement savings, balancing safety and growth potential. Understanding your financial goals and risk tolerance is key to choosing the right one. Contact us today for a free quote.

Need Help Buying a Deferred Annuity?

Get help from a licensed financial professional. This service is free of charge.

Contact Us

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

Scroll to Top