Multi-Year Guaranteed Annuities (MYGA) in Nevada

A MYGA and a bank CD both guarantee a fixed interest rate for a specific term, but there are key differences. MYGAs typically offer rates 0.50% to 1.50% higher than comparable CDs. MYGA interest grows tax-deferred (you pay no tax until withdrawal), while CD interest is taxed annually — even if you do not withdraw it. CDs are FDIC-insured up to $250,000, while MYGAs are backed by the insurance carrier's financial strength and state guaranty fund protections. For conservative investors in higher tax brackets, the tax-deferral advantage of MYGAs can result in significantly more accumulated wealth over a 5-10 year period.

Nevada residents can access MYGAs with guarantee periods ranging from 2 to 10 years, with the most popular terms being 3, 5, 7, and 10 years. Longer terms generally offer higher guaranteed rates to compensate for the extended commitment. Some carriers also offer short-term MYGAs of 2 years for investors who want guaranteed returns without a long commitment. Your Nevada-licensed agent can compare current rates across all available terms to help you select the optimal term — or combination of terms in a laddered strategy — for your retirement timeline.

A MYGA ladder involves purchasing multiple MYGAs with staggered maturity dates — for example, a 3-year, 5-year, 7-year, and 10-year contract purchased simultaneously. This strategy provides regular liquidity windows (as each MYGA matures, you can access funds penalty-free), diversifies your interest rate risk (you capture rates at multiple points on the yield curve), and reduces the risk of reinvesting all your funds at a single potentially unfavorable rate. Each maturity event gives you the option to withdraw for income, reinvest at current rates, or convert to a different retirement vehicle.

At maturity, you typically have several options: withdraw all funds (paying income tax on the earnings portion), renew with the same carrier at their current renewal rate, transfer to a new MYGA with a different carrier via a 1035 tax-free exchange, or convert the proceeds into a lifetime income annuity. Most carriers provide a 30-day window at maturity during which no surrender charges or penalties apply. If you take no action, many contracts automatically renew at a one-year rate, which is often lower than multi-year rates. Planning your maturity strategy in advance ensures you maximize the value of your MYGA proceeds.

MYGA rates have fluctuated significantly over the past decade, closely tracking prevailing interest rates set by the Federal Reserve. As of recent years, MYGA rates have been competitive relative to historical averages, with 5-year MYGAs frequently offering rates between 4.50% and 5.50%. However, rates change regularly based on market conditions. The best approach is to work with a Nevada-licensed agent who monitors rates across multiple carriers in real time and can help you lock in competitive rates when they are available. A laddered approach also mitigates the risk of timing the market.

Yes, you can fund a MYGA with qualified retirement account money through a direct rollover from an IRA or 401(k). This is a common strategy for pre-retirees who want to protect a portion of their retirement savings from market risk while earning a guaranteed rate. The MYGA is held inside the IRA wrapper, maintaining its tax-deferred status. Required minimum distributions (RMDs) can be taken from the MYGA without surrender penalties (most carriers waive charges for RMD withdrawals), though RMDs are taxed as ordinary income. Nevada's lack of state income tax makes this particularly advantageous compared to states that tax IRA distributions.