MYG 7-Year with ROP (NY) review

Yes, for the right buyer. This is a good annuity for a New York resident who wants a guaranteed fixed rate for seven years, no market exposure, and the reassurance that a full surrender during the charge period will return at least the original premium. It is less appealing for anyone who wants a shorter commitment, a product available outside of New York, or features that go beyond basic guaranteed accumulation.

The main reason to buy this annuity is certainty. You lock in a multi-year rate at issue — the brochure shows 4.45% for deposits below $100,000 and 4.80% for deposits of $100,000 or more, though those figures are from February 2018 and current rates will differ. The secondary reason is the Return of Premium guarantee, which removes one of the common concerns about a long surrender period: the possibility that a forced early exit would leave you with less than you started. The confinement waiver adds a practical safety valve for health-related liquidity needs.

I think this is best for a New York resident in or approaching retirement who has a defined seven-year time horizon for a portion of their assets, wants a guaranteed return without any index or market exposure, and values the ROP feature as peace of mind rather than an expected outcome. It can work well inside a qualified account given the favorable RMD treatment. It is less suited for someone who wants to stay flexible, expects to rebalance within the surrender window, or is primarily shopping for lifetime income.

You are buying a contract where the insurer guarantees a specific interest rate for the full 7-year term. That rate applies to the Multi-Year Fixed Strategy and is locked at issue — it does not reset annually, it does not fluctuate with an index, and it does not depend on market performance. When the term ends, the rate resets or the contract can be surrendered at full accumulated value with no charge. The Return of Premium feature is not a crediting method; it is a surrender floor that means the minimum you can walk away with during the charge period is your net premium invested, even if surrender charges would otherwise reduce that amount.

The Multi-Year Fixed Strategy credits a single guaranteed rate for the full 7-year contract term. That rate is set at issue, not annually — so what you see at the start is what you get for the life of the surrender period. Additional premiums received after issue go into the 1-Year Fixed Strategy, not the Multi-Year strategy, and that annual rate renews each year at or above the contractual minimum. The rate banding is straightforward: deposits below $100,000 earn the lower band rate, while deposits of $100,000 or more earn the higher band rate. The difference between bands (35 basis points in the 2018 brochure) is worth knowing before you decide on a deposit amount near the threshold.

The Return of Premium benefit is the distinguishing feature here. On full surrender during the withdrawal charge period, the owner receives the greater of the cash surrender value or the return of net premium — meaning initial and additional premiums less prior net withdrawals. That matters because surrender charges on a 7-year MYGA can be substantial in early years (9% in year one). Without ROP, an early exit in year two or three could cost real money. With it, the floor is your original deposit. This is not a reason to buy with the intent to surrender early, but it does change the risk profile of the decision.

This annuity is designed as a 7-year commitment. Free withdrawals of up to 10% of accumulated value (measured at the most recent contract anniversary) are available starting in contract year one, which is more accessible than products that restrict free withdrawals until year two. RMDs attributable to the contract are treated as part of the free withdrawal amount even if they exceed 10%, which makes the product workable inside a traditional IRA or other qualified account.

Withdrawals above the free amount are subject to a surrender charge schedule that starts at 9% and steps down to 3% in year seven:

There is no Market Value Adjustment on this product, which removes one layer of uncertainty in a rising-rate environment. The confinement waiver allows access to 100% of accumulated value after the first contract year if the owner is confined to a qualified care facility for 60 or more consecutive days. The terminal illness waiver similarly provides full access after the first anniversary if a terminal diagnosis carries an expected death within one year.

There are no base contract fees and no rider fees on this product. That is straightforward — what the rate sheet shows is what you get, with no annual drag.

The main tradeoff is the commitment length. Seven years is on the longer end for a guaranteed-rate product, and the surrender schedule does not reach single digits until year seven. The rate banding creates a mild decision point around the $100,000 threshold. And because the brochure materials are from 2018, current rates will differ from the figures cited — the structure is the same, but the specific yield you can lock in today will reflect current market conditions and should be confirmed directly with the issuer or your advisor.

Legal Entity: Athene Annuity & Life Assurance Company of New York

Parent: Athene Holding Ltd.

A.M. Best Rating: A+

Athene is a large, well-capitalized annuity carrier backed by Apollo Global Management. The A+ A.M. Best rating reflects strong financial stability. The New York entity is a separate legal issuer from the national Athene carriers, which is required to sell annuities in New York under the state's insurance regulations.