9-Year Fixed Annuity Rates

Current 9-Year Fixed Annuity Rates

Case Study: Buying a 9-Year Fixed Annuity

Jack has saved well for his retirement and feels good about his financial situation in the coming years. But the thought that plagues him, and many retirees, is, what will happen if he lives many more years and depletes his savings?

He is interested in finding a way to grow the money he already has and combat the risk of outliving his savings, but he’s well past the age of being interested in serious risk.

For this reason, Jack becomes interested in a 9-year fixed annuity offering a guaranteed interest rate of 5.2%. This product will allow him to grow his money in a tax-deferred way, has little to no risk and — unlike a CD — will give him the ability to convert his money into guaranteed monthly payments that will last the rest of his life.

Jack purchases the annuity with $100,000. After the 9-year term, his money will grow to nearly $160,000. He can then convert that cash into monthly payments, which will continue for as long as he is alive, operating as a purchased pension.

9-Year Fixed Annuities vs. Other Term Products

Nine-year fixed annuities hold many advantages. They are safe products that don’t risk your principal, they are tax-deferred and they can result in lifetime payments.

But one of their biggest selling points currently is their guaranteed interest rates, which can offer a significant amount of return given the low level of risk involved. 

“Fixed interest rates of around 5% to 5.50% can still be found,” Ken Orenstein, FRC, told Annuity.org “I work with one particular fixed index annuity that is still — for the time being, anyway – paying a first-year fixed interest rate of 8%, with a second-year guarantee of around 4.50%.”

In the current market, 9-year fixed annuities may outpace the rates of other similar safe options like certificates of deposit or bonds.

On top of the potential rate differences, fixed annuities also offer unique advantages. Tax deferral can be a major feature, allowing you to not owe taxes until you take money from your annuity and possibly take advantage of a lower tax bracket if you purchase your annuity before retirement.

But if liquidity is a major concern for you, then be familiar with the rules surrounding early withdrawals. Fixed annuities generally allow for up to 10% of the contract to be withdrawn without penalty. But you may face steep charges if you attempt to take out more than that before your agreed-upon term is complete.

CDs may offer much lighter penalties if you unexpectedly need your money.

Having maximum liquidity is important when it comes to annuities and many annuities have options to access the entire amount in the case of terminal illness or if you become confined to nursing care. I have clients who are in their 80s where this is a particular concern for them and they want the peace of mind knowing that they can access their money if they need it in these situations. There are companies that offer this feature and there are some who do not. It is important to consult with an expert who can show you both.

John Stevenson, CFFOwner and Advisor at Stevenson Retirement Solutions

John Stevenson, a Certified Financial Fiduciary®️, specializes in securing retirements with tax-free accounts. With a focus on guaranteed retirement, he’s ensured none of his clients suffer from market fluctuations. As a renowned educator and podcast host, John empowers thousands weekly, sharing his expertise in minimizing taxes and protecting against financial downturns.

How We Get Our Rates Data

Annuity.org supplies fixed annuity rates through Cannex — an independent company that provides access to a database of updated annuity products.

We synchronize and update our rates information several times each week using the newest Cannex data to help ensure you have access to the most recent interest rates available.

Annuity.org features rates for fixed annuities from one- to 10-year terms. In addition, we list the carrier that offers the rate and its respective AM Best financial strength rating.