Best Fixed Annuity Rates for 2022

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Fixed annuity rates are up, along with interest rates in general. The best fixed annuity rates currently are 4.10% for a two-year term, 4.95% for a three-year term, 5.30% for a five-year term and 5.20% for a ten-year term.

Here’s what you need to know about fixed annuities: what they are, who should own them and who has the best rates in 2022.

Learn: 5 Things You Must Do When Your Savings Reach $50,000

What Is a Fixed Annuity?

An annuity is a contract made between an insurance company and an investor. In exchange for premium payments from the investor, the insurance company agrees to pay the investor a certain amount of money in the future. That’s the simple definition, but in reality, today’s annuities are complex investments, so it’s important to understand all the components.

Annuity Types

Annuities can be either fixed or variable. This refers to the return on the investment within the annuity contract.

Fixed annuities pay a fixed, guaranteed rate of interest. Variable annuities invest premium payments in equities, mutual funds or other variable investments, so the rate of return can vary. Variable annuities usually have some type of minimum guaranteed return.

Premium Payments

An investor can make one payment into an annuity — known as a lump sum or single-premium — or they can make regular payments over time. Payments are made during the “accumulation phase” of the contract. The other phase is the “payout phase,” during which the insurance company makes periodic payments to the annuitant, usually for the rest of their life.

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Annuity Payouts

Annuities may begin making payments immediately or after a period of time. An immediate annuity, as the name suggests, begins paying out right away, and can only be purchased with a single premium. Deferred annuities begin making payments at some point in the future. In either case, annuities are designed to make payments for the rest of the annuitant’s life. For this reason, many people use annuities to provide them with an income stream in retirement, using the annuity as a sort of “personal pension.”

The amount of the annuity payout depends on a number of factors. It depends on the amount of premium(s) paid into the contract, the rate of return and the age at which the annuitant begins taking payments.

When you begin taking payments, you annuitize the contract. This means that your investment becomes a stream of income, and you will receive payments for the rest of your life. The “lump sum” amount you invested in the contract no longer exists.

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Here are two examples that illustrate how annuitization works. Suppose two investors, Jack and Jill, each have a fixed annuity. They each invested $100,000, and with growth, their contracts are now each worth $125,000.

Jack and Jill are now 70 years old. They both annuitize their contracts. They will each get $500 a month for the rest of their lives — this is for illustration only. Jack would likely get a higher payout because, actuarily speaking, men have shorter life expectancies.

Jack dies two years later. He has received $12,000 in annuity payments. There is no death benefit on an annuitized contract, so that’s all he or his beneficiaries will get from his $100,000 investment.

Jill, on the other hand, lives to age 95. She has received $150,000 in annuity payments, even though her contract had a value of $125,000 when she annuitized it.

Some contracts allow for payments to continue for a “period certain.” This means that payments will be made for a certain period of time or for the rest of the annuitant’s life, whichever comes last. If Jack had selected a “life with 10-year certain” payout option, his beneficiaries would have continued to receive payments for eight more years after he died.

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Best Fixed Annuity Rates for 2022

As the name suggests, interest rates for fixed annuities are fixed but may be only for a certain period of time. And that time period may not coincide with the surrender period, or the time you will hold the contract before annuitizing. Before you invest, make sure you understand when and how your interest rate can change.

Annuity rates change constantly, so when you’re ready to invest, compare the rates at that time. The following rates are accurate as of Oct. 31, 2022, per Annuity Resources.

Two-Year Annuities

Company Product Rate
Aspida Synergy Choice 2 4.10%
Oceanview Harbourview 2 4.10%
Americo Platinum Assure 2 4.10%

Three-Year Annuities

Company Product Rate
American Life American Classic 3 (No Withdrawals) 4.95%
Aspida Synergy Choice 3 4.85%
American Life American Classic 3 4.80%

Five-Year Annuities

Company Product Rate
Nassau MYAnnuity 5X (No Withdrawals) 5.30%
Symetra Symetra Select Max 5 5.20%
Aspida Synergy Choice 5 5.20%
F&G Guarantee Platinum 5 5.20%

Ten-Year Annuities

Company Product Rate
Oceanview Harbourview 10 5.20%
AIG American Pathway Vision MYG 10 5.15%
Oxford Multi-Select 10 5.00%
Clear Spring Preserve 10 5.00%
Guaranty Guaranty Rate Lock 10 5.00%

Advantages of Fixed Annuities

Fixed annuities offer a fixed, guaranteed interest rate so you know what you’ll be earning for the life of the contract. You also know how much money you will receive once you annuitize the contract, and you know that amount will continue for the rest of your life.

Interest in an annuity accumulates on a tax-deferred basis. This means that you don’t pay taxes on the gain until you withdraw the money. This works in much the same way as an IRA — your money grows, but that growth isn’t taxable until it’s withdrawn. Many people use annuities for their IRAs, but understand there is no additional tax advantage to doing this.

If you die before you annuitize your contract, your beneficiaries will receive a death benefit, which is usually equal to the contract value, or the amount you invested plus the interest earned to that point.

Disadvantages of Fixed Annuities

When you purchase an annuity, you are usually committing to keep your money invested for a certain period of time. In fact, annuities have so-called surrender charges, which is a percentage of the premium amount that you will pay if you withdraw your money before a certain amount of time.

Surrender charges can be as much as 10% and can be incurred for as long as 10 years, although they typically decline over time. For example, if your annuity has a seven-year surrender period, you might pay 7% if you withdrew the money in the first year, but only 2% if you withdrew it in year six.

One of the advantages of a fixed rate annuity can also be a disadvantage — the guaranteed rate. You may purchase a fixed annuity that guarantees 3% each year, only to see interest rates rise to 6%, 7% or even more.

Before You Invest

Before you invest in a fixed annuity, make sure you understand all of its features, benefits and drawbacks. Know what your interest rate will be, and if and when that rate can change. Understand what your options are if you need to withdraw the money prior to annuitizing. Make sure you’re purchasing your annuity from a reputable insurance company. Annuities are not FDIC-insured. They are backed by the insurance company’s ability to pay them.

There are many different fixed annuities, and none of them is right for everyone, but one may be right for you. Understanding all the features and constraints, and recognizing that it’s a long-term investment, is critical to finding the right fixed annuity for your needs.


  • What is the highest paying fixed annuity rate?
    • As of Oct. 31, 2022, MYAnnuity 5X (No Withdrawals) from Nassau has the highest available fixed annuity rate at 5.30%, according to Annuity Resources.
  • Who has the best fixed index annuity rates?
    • While Nassau offers the current highest rate, Oceanview, Aspida and American Life also offer high rates for varying terms.
  • Will fixed annuity rates increase in 2022?
    • Fixed annuity rates have been increasing in 2022. If the Fed Rate is increased again, it is likely that fixed annuity rates will also increase.

Information is accurate as of Oct. 31, 2022, and is subject to change.

Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.

Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.

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About the Author

Karen Doyle is a personal finance writer with over 20 years’ experience writing about investments, money management and financial planning. Her work has appeared on numerous news and finance websites including GOBankingRates, Yahoo! Finance, MSN, USA Today, CNBC,, and more.
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