www.privateairny.com Private Air | Spring 2022
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INVESTMENT
By: Ken Nuss
Each has distinct pros and cons;
compare before investing
F
ixed-rate annuities act much like bank certificates of
deposit but usually pay much higher rates than CDs of
the same term.
How can insurers afford to do that? After all, both banks and
insurers pay a set rate. Before we answer that question, let's cover
the basics of how each works.
A very popular type of fixed annuity, the multi-year guarantee
annuity, pays a guaranteed rate of interest for a period of two to
10 years. ere's no sales charge. is is why they're often referred
to as "CD-type annuities," but there are key differences between
them and CDs.
WHY FIXED-RATE
ANNUITIES
PAY MORE THAN
BANK CDS
