"Good annuity rate" is a moving target — it depends on the term you lock, the type of annuity, the carrier's financial strength, and what the bond market is doing the week you buy. Here's where the numbers actually sit in early 2026, and how to tell whether a quote in front of you is competitive or quietly below market.
What's a good annuity rate right now?
As of early 2026, a competitive MYGA (multi-year guaranteed annuity, the fixed type) rate runs about 5.4% to 6.5% for 3- to 10-year terms, and a strong fixed indexed annuity (FIA) offers caps around 9% to 11% on a one-year S&P 500 cap strategy — anything meaningfully below the top of those ranges is leaving money on the table.
That's the headline. But "good" is relative to what else is on the shelf the same day. The best 5-year MYGAs in our rate data are paying north of 6%, while the median 5-year sits closer to 4.8%. The gap between a top-of-market contract and a middle-of-the-pack one — on the *same* term, with similar guarantees — can easily be a full percentage point. On $200,000 over five years, that's roughly $10,000 of forgone interest. Shopping isn't optional.
What counts as a good rate by term?
Fixed annuity rates move with the term you commit to and with the broader interest-rate environment. The table below shows where the top of the market sits versus a more typical "middle" rate in early 2026, based on our live MYGA rate data. Use the top column as your benchmark — that's what a competitive quote should be near.
| Term | Competitive (top-of-market) | Typical (middle) | What "good" looks like |
|---|---|---|---|
| 3-year | 5.5% – 6.0% | ~4.6% | At or above 5.5% |
| 5-year | 5.8% – 6.4% | ~4.8% | At or above 5.7% |
| 7-year | 5.9% – 6.5% | ~4.9% | At or above 5.8% |
| 10-year | 5.5% – 6.0% | ~4.6% | At or above 5.5% |
A few things this table is telling you:
- The 5- and 7-year terms usually pay the most. That's the sweet spot where carriers compete hardest. Going longer than 7 years often doesn't add much rate — you're mostly just locking your money up longer.
- A 3-year and a 10-year can pay nearly the same. When the yield curve is flat (as it has been), there's little reward for the extra seven years of commitment, so a shorter term can be the smarter trade.
- Bonus rates and teaser rates muddy the picture. Some contracts advertise a high first-year rate that drops sharply after year one. Always ask for the *guaranteed rate for the full term*, not the headline number.
You can see current rates broken out by term on our 3-year, 5-year, 7-year, and 10-year rate pages, and compare them carrier-by-carrier on the carrier rates page.
Why do annuity rates vary so much by carrier and state?
Two annuities with identical terms can be priced almost a percentage point apart. A few reasons:
- Financial strength. Higher-rated carriers (A++ or A+) often pay a bit less, because they don't need to compete on rate to attract money. Some of the very top rates come from smaller or newer carriers with lower ratings. That's not automatically bad — annuities are also backed by your state's guaranty association up to a limit — but the rating is part of what you're trading for the extra yield.
- How the insurer invests. Carriers fund annuity payouts mostly with bonds. A company holding higher-yielding assets can pass more of that yield through as a higher rate.
- State availability. The same product is often filed at different rates in different states, and some products aren't approved in your state at all. New York, in particular, frequently sees lower rates and fewer available products because of stricter regulation.
- Premium bands. Many contracts pay a higher rate above a deposit threshold — often $100,000. A quote that looks low might just be the small-deposit tier.
Because of all this, the rate you're quoted is only meaningful next to what *other* carriers would give you for the same term and deposit. You can check what's available where you live on our rates-by-state page.
Fixed vs. indexed: what rate should you expect from each?
These are two different products that get lumped together, and they don't quote rates the same way.
A fixed annuity (MYGA) quotes a flat, guaranteed interest rate for the term — like a CD, but issued by an insurer and tax-deferred. The 5.4%–6.5% range above is your benchmark. What you see is what you get; there's no upside beyond the stated rate, and no downside either.
A fixed indexed annuity (FIA) doesn't quote a single rate. Instead it credits interest based on a market index (usually the S&P 500), limited by a cap, participation rate, or spread. A "good" FIA in early 2026 might offer a one-year cap around 9%–11%, or a participation rate of 50%–70% on an uncapped index strategy. Your principal is protected in a down year (you earn 0%, not a loss), but your average return over time typically lands somewhere between a MYGA and the stock market — not the cap number you see advertised.
The honest framing: don't compare an FIA's cap to a MYGA's rate as if they're the same thing. A 10% cap is not a 10% guaranteed return. If you want a known number, a MYGA's rate is the apples-to-apples figure. If you want some market upside with downside protection and can accept a variable result, an FIA is a different bet. Our explainers on fixed indexed annuities and caps, spreads, and participation rates walk through how the crediting actually works.
If you'd rather see how these products are rated head-to-head rather than just quoted, our fixed annuity reviews and fixed indexed reviews score them on more than rate alone.
How do you actually lock in the best rate?
Rates change frequently — sometimes weekly — so "the best rate" is whatever's available the day you fund the contract. A few practical moves:
- Compare at least 5–6 carriers on the same term and deposit. This is the single highest-value step. The spread between top and median is real money.
- Confirm the guaranteed rate is for the full surrender term, not a first-year teaser that resets lower. Ask to see it in writing.
- Match the term to when you'll need the money. A great 7-year rate is worthless if you need the cash in year three and pay a surrender charge to get it out.
- Weigh the carrier's rating, not just the rate. The top rate from a weakly rated carrier and a slightly lower rate from an A-rated one is a judgment call worth making consciously.
- If you already own an annuity, check whether a tax-free [1035 exchange](/education/1035-exchanges) into a higher rate makes sense — but only after accounting for any surrender charge on the old contract.
One more comparison worth making before you commit: annuity rates against CD rates. MYGAs frequently beat comparable CDs *and* defer the taxes, but CDs stay FDIC-insured and fully liquid at maturity. We break that trade down in Annuity vs. CD: Where Should Your Safe Money Go?.
A note on freshness
Every rate in this article is an early-2026 snapshot. Annuity rates track the bond market and are repriced often — by the time you read this, the specific numbers may have shifted up or down, and availability varies by carrier, state, and deposit size. Treat the ranges here as a benchmark for *what a competitive quote looks like*, not a guarantee of what you'll be offered. Always pull a current quote before deciding, and never assume the first rate you're shown is the best one on the market.