When it comes to planning for retirement or just seeking a safe, predictable return on your savings, multi-year guaranteed annuities (MYGAs) can be a solid choice. These fixed annuities lock in an interest rate for a specific period, which makes them attractive during uncertain market conditions or when youre not comfortable taking on risk. But the real question many ask is, at what age does it actually make the most sense to get one?

The answer isnt as simple as picking a number. It depends on your goals, your stage in life, and how the annuity fits into your overall financial picture.

Understanding the Basics

A MYGA, or multi-year guaranteed annuity, is similar to a certificate of deposit offered by insurance companies. You deposit a lump sum and earn a guaranteed interest rate for a set term, usually between 3 to 10 years. After the term ends, you can withdraw your funds, roll them into another annuity, or start taking income.

Basic multi-year guaranteed annuities are often favored by conservative investors who want stability, especially those nearing or already in retirement. Since MYGAs dont typically offer liquidity beyond limited penalty-free withdrawals, theyre best used with money you wont need right away.

In Your 40s and 50s: Building Stability Before Retirement

People in their 40s and 50s are still in their prime earning years, but theyre also beginning to think seriously about retirement. This is a time when many are maxing out 401(k) or IRA contributions and looking for ways to safely diversify their assets.

Setting up a MYGA in this age range might not be as common, but its certainly not a bad move. If youve got a chunk of cash from a bonus, inheritance, or home sale and you dont want it sitting in a low-yield savings account, a MYGA can offer a better return without market risk.

This is also a good strategy if youre planning to retire early. Locking in a rate now, while interest rates are favorable, could give you a predictable return to draw from before tapping into more volatile investments.

Age 60 to 70: The Sweet Spot

For many people, the most effective time to set up a MYGA is between the ages of 60 and 70. Heres why:

• Youre typically winding down your full-time work life and may be looking for a place to park part of your retirement savings.
  

• You might not need to touch certain assets for several years, especially if you are delaying Social Security or have other income streams.
  

• You want stability, not surprises.
  

At this stage, the risk of major losses in the stock market becomes harder to recover from. A MYGA provides peace of mind by delivering guaranteed growth, which can help balance your portfolios more aggressive parts.

Many retirees use MYGAs as a bridge strategy. For example, if you plan to delay Social Security until 70 to maximize your benefit, a MYGA can fill the income gap with interest earnings or lump-sum access when the term matures.

According to a 2025 LIMRA report , total annuity sales reached $434.1 billion in 2024, marking a 13% increase from the previous year. This surge underscores the growing demand for guaranteed returns, especially among individuals approaching retirement age.

After Age 70: Less Flexible, Still Useful

Once youre past 70, a MYGA can still be a good option, but the reasons for buying shift a little. At this point, youre likely already retired and drawing income from other sources. You may also be subject to required minimum distributions (RMDs) from your tax-deferred accounts.

Because MYGAs are non-qualified in many cases (meaning theyre funded with after-tax dollars), they wont help reduce your RMDs. But they can serve as a way to preserve wealth, pass money to heirs, or just keep earning guaranteed interest without taking on new market risk.

However, older buyers should be cautious of the annuitys surrender charges and limited liquidity. If health expenses rise or unexpected needs arise, having too much tied up in an annuity could become a burden. Thats why its usually recommended to only place part of your savings in a MYGA, leaving the rest accessible.

When a MYGA Doesnt Make Sense

Age aside, there are times when a MYGA simply isnt the right fit:

• If you need regular income now, a MYGA wont provide monthly payments unless you annuitize it later.
  

• If youre unsure when youll need the money, locking it up could backfire.
  

• If you are still many years away from retirement, other vehicles like growth-focused investments may offer better long-term returns.
  

How to Decide If Youre at the Right Age

Theres no perfect formula, but here are a few questions to help you decide:

• Do you have money you wont need for 3 to 10 years?
  

• Are you uncomfortable with stock market volatility?
  

• Do you want to lock in a guaranteed rate now before interest rates shift?
  

• Are you looking for a low-maintenance, tax-deferred growth option?
  

If you answered yes to most of those, your age might not matter as much as your goals. That said, for people in their early 60s, MYGAs can be especially effective as part of a broader retirement income strategy.

A Final Thought

The best age to set up a MYGA is when it aligns with your financial priorities. Whether thats 50 or 70 depends less on the number and more on what role the annuity will play in your plan. For many, its about creating a layer of certainty in a world full of financial unknowns.

If youre nearing retirement, MYGAs can act as a solid anchor for a portion of your portfolio. And if youre younger but have extra cash you want to grow safely, its worth considering even earlier than most people think. Just be sure to look closely at the terms, shop around for the best rate, and confirm the insurance companys ratings before locking in.

Sometimes, timing isnt about age at all. Its about opportunity, and a MYGA can be one worth seizing when the moment is right.