What tax deferral is actually worth
Most people compare MYGAs to bank CDs by looking at the headline rate. The honest comparison is what hits your account after the IRS gets its share. Move the sliders.
Why CDs lose ground
A CD pays interest each year, and that interest gets taxed each April — even if you don’t touch it. The IRS’s bite shrinks how much is left to compound the next year.
How MYGAs sidestep it
Interest inside a MYGA stays inside the contract, untouched by taxes until you withdraw. Every dollar of growth keeps compounding on itself.
The retirement angle
Many MYGA buyers wait to withdraw until they’re retired and in a lower bracket. That widens the after-tax gap further — the calculator above assumes today’s bracket throughout.
Illustrative only. Actual outcomes depend on the carrier’s contract, surrender charges, market value adjustments, and tax treatment of your specific withdrawal pattern. Annuity gains withdrawn before age 59½ may be subject to an additional 10% federal penalty. State tax treatment varies. Not tax advice — consult your CPA.
See the after-tax gap on your own money
Get a free, no-pitch Second Opinion — we’ll run the after-tax MYGA-vs-CD comparison for your bracket and the deposit you have in mind, and send you a plain written take. You decide what to do with it.
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