The MYGA as a Bond Alternative
January 7, 2025 by Allison Bell
Registered index-linked annuities have been getting a lot of attention lately, but they accounted for just 14% of U.S. individual annuity sales in the third quarter of 2024, according to Wink.
Sales of multi-year guaranteed annuities — contracts from issuers that promise to pay a set interest rate for at least a specified number of years, such as three, four, five or seven years — accounted for about 37% of individual annuity sales.
David Byrnes, chief distribution officer at Security Benefit, an annuity issuer, expects worries about the presidential transition and the geopolitical situation to help keep MYGA sales strong.
Wink’s Moore on the Market: My man David Byrnes of Security Benefit Life Insurance Company suggests multi-year guaranteed annuities (MYGAs) as a bond alternative.
So, in terms of a 60% stocks/40% fixed income strategy, one could allocate 60% of their portfolio to stocks, while reserving 20% for bonds and another 20% to MYGAs. -sjm
