Trends in the gap between what fixed annuity contracts pay holders and what comparable bank certificates of deposit pay are moving in the annuity issuers’ favor, according to AnnuityAdvantage.
(Related: Consider Fixed Annuities for Your Client’s Fixed-Income Portfolio)
The Medford, Oregon-based company runs an annuity sales website. It tracks 290 annuity contracts from 35 insurers.
The highest-paying 3-year contract now offers a 2.1% crediting rate, and the highest-paying 5-year contract offers a 3.15% crediting rate, the firm says.
That compares with top CD rates of 2% for a 3-year CD, and just 2.4% for a 5-year CD, according to BankRate.com.