This is the Truth Network. Welcome to Finishing Well, brought to you by CardinalGuide.com, with certified financial planner Hans Shyle, best-selling author and financial planner, helping families finish well for over forty years. On Finishing Well, we'll examine both biblical and practical knowledge to assist families in finishing well, including discussions on managing Social Security, Medicare, IRAs, long-term care, life insurance, investments, and taxes.
Now, let's get started with. Finishing well, but welcome to Finishing Well. Was certified financial planner Hans Shile, and today's show, multi-yeared guaranteed annuity, sometimes referred to as MIGAs, for 2026. And as I was thinking about this one, Noah, you know, in his own way, he was teaching on the idea of MIGAs, of of that guaranteed annuity. In other words, You know Noah was asked to make long-term preparations before he can see the circumstances that would even make that necessary.
In other words, Noah had never even seen rain; didn't even know what rain was. Yet God told him to make preparations and told him specifically how to do that. And you know, in doing that, he got a promise from God on the future, and he acted. On that promise ahead of time was completely faithful and trusted God. Right, he committed to the long-term project, and during the waiting period, you know, he was constantly at work and staying with the provision that God gave him.
So when the storm came, right, the preparation was in place, and there it was. And so we have that opportunity today with looking at these Micahs, Hans. Yeah, I mean, people that once they understand these things, and you know, they're a little put off with it at first. It's with an insurance company. I've not heard of this company.
What happens if the company goes out of business? What happens to my money? Are the FDIC guaranteed? And the answer is no.
So there's a lot of stop signs. A lot of Things that people just have against this from the very beginning, and once we just sit down and take a look at them, and we're not talking about all your money we're throwing in here. We're just talking about a percentage of it or a piece of it, and they really start to understand these. And we typically like to deal with A-rated insurance companies. Just for the reason that they're not guaranteed by the government by the federal government, which they're not like a like a bank CD would be.
So we're going to deal with the higher rated insurance companies, and we've got about thirty of them that offer these MIGAs multi-year guaranteed annuities.
So we're looking at a spreadsheet, and we're picking really based on the interest rate. And the term that you're going to pick, very much like you'd pick a CD. And so, what we were talking a little bit before the show, Robbie Knight, is like we're fixing to way overcomplicate these things.
So I'm going to start at the beginning, and I'm going to just say that you could buy a five-year duration MIGA.
So that means you buy it right now in 2026. In September of 2026, October of 2026, and you're tying your money up for five years, or until 2031. And what you're going to get for that, if you buy it from Knighthead Life, six point zero three percent. If you buy it from a Speed of Life, it's right here in Durham, five point eight percent. And if you bought it from Midland National, five point four five percent, and all of these rates have come up a little bit, so they may even be a touch more than that now.
But in any case, that's what I got on the sheet, and you just earn your interest. You know, if you bought that six percent one, that's just going to interest is compound and compound and compound, and then when twenty thirty one rolls around, you got a decision to make. Do you want to Do you want to take your hundred thousand dollars that you put in here, plus your, I don't know, forty, fifty thousand dollars of accumulated interest? Do you want to just take it and go somewhere else with it? And then if you do that, you're going to have to pay taxes on that forty to fifty thousand dollars of accumulated interest, or do you want to roll it over into another annuity?
And with whatever benefits in it, or just another five-year annuity, it would give an interest rate, and then you'll just postpone the taxes even further.
Now, if that thing was in an IRA, then the taxes really don't matter because it's all tax deferred. If you roll it into another IRA, it'll just continue to be deferred.
So it's it's very much like a CD. It's just not at a bank, and the interest rates are typically pretty attractive.
So Robbie, yeah, the video that you did, you made an awesome point. I thought that you know here's something that the interest rates are certainly better.
However, there's just a teeny weeny more risk to it, which is how you why you're benefited with the interest rate difference between that and a CD, right? That's it, and a couple other points is some of these policies allow you to take out ten percent within any given year, and typically other than the first year.
So if you bought a five year one, and like the one I described, and you're in your six percent, and let's say you put a hundred thousand dollars in there, and then you're rolling along in the second or third year. And you all of a sudden wanted some of your money, you could take ten percent without a penalty, but you can't do that with a CD. You also, with the ones that don't offer the ten percent, the rest of them offer where you could just take the interest, and you could either take it monthly in a check, so. You could just take your six point zero three percent. That's an annual rate, but whatever that produces every month, you could get a check sent to you, give you a little income for five years, and then you just take the principal back at the end.
So you've got a lot of options with these things that you don't have with a CD. Yeah, yeah, and I love the the whole idea that. You know that those things they just they bake, and then you know here comes this larger sum. But so if you if if you're taking IRA money and you're doing that, it's it's still staying within the IRA and still is a MIGA. Absolutely.
So so so in fact, most of the MIGAs are most more than not. They are IRAs, so you would just take. Let's say you got an IRA with six hundred thousand dollars in it, and you just you you're you're not making much on your bonds inside of there.
So you say, I really want to make a hundred thousand dollars safe. We would just roll a hundred thousand out of the IRA and send it to Nighthead Life and. It would just go custodian to custodian transfer, and now your hundred thousand would be in an IRA, over at Knighthead Life. It have all the same IRA rules, but it would be just tied up for five years. Right, and so I I know that for a lot of people, or if you watch.
All the crazy videos that people do on annuities—you know—one of their biggest fears on annuities is fees, and how does that correlate to the CDs? On the Miga, there is no, there are no fees. Really, zero. It just people say they can't be. Like, how how do you get paid?
How how do I make money?
Well. The insurance company pays us.
So, if you took this Nighthead Miga, and you put a hundred thousand dollars in there, at the end of the first year, you would have around a hundred and six thousand dollars. I mean, I don't want to calculate it to the penny. Interest rates calculated, you know, like the insurance company does it, but you you'd have a hundred six thousand dollars in there, and you wouldn't have One hundred six thousand minus because there are no fees, zero.
Well, that is impressive, right?
So it really, really does compare to the CD in all regards because the interest rate's a bit higher, and there are no fees, and so. You know the the risk. What you said in the video was that a CD is backed by the FDIC. If there's some kind of absolute catastrophe, where the Meiga is backed, you know, if the insurance company was to fail. But you're most of the time, you said people are using A-rated companies.
But if it were to fail, it's it's there's something called an insurance bureau or something backs it. Insurance Guarantee Association.
Okay, and we're prohibited. From discussing that, unless the consumer brings it up, because the insurance departments do not want us promoting people to buy an annuity, because if the insurance company fails, you'll just go to the guarantee association, which is set up by the insurance department.
So they don't want us using that to promote annuities.
So I don't really want to do that on this show. It's fine if the customer brings it up, then we explain it to them. Yeah, and I don't think I'm breaking any rules today, but I don't really want to go any further with that.
So there is a there is a safety net for these things, but we'll leave that to another day.
Okay. Yeah.
So the really important factor is these these are A-rated companies. I mean, they are really trustworthy. I guess financially sound. And that's rated by AM Best, and you know you can go in and research about them. And AM Best rates the financial stability and the claims paying ability of an insurance company.
And they have several layers of ratings, and we we pretty much stick in the A category. There's some exceptions to that. We have a few B plus companies. That we do business with, but we're going to give you awareness of all that. And in this video, all the things that are on the chart, all the different choices, are all A and above companies.
So, and I want to give you an idea about the duration, so you can buy these. What we showed on the video was a three-year term, a five-year term, a seven-year term, and a ten-year term. But there's actually, if we sit down and we want to create a ladder, we can set them up as a two-year, a three-year, a four-year, a five-year, all the way up to ten years, and we use different companies for each section, so that we spread your risk around a little bit.
Well, this would be a great point to remind you that this show is brought to you by Cardinal Guide, CardinalGuide.com. And if you go to CardinalGuide.com, you're going to find the seven worries tabs. And today's show was under the income and investment worry tab. Again, under this exact same title, multi-year guaranteed annuity, 2026.
So you're going to see a great deal of discussion on the video, as well as show notes and a board, and lots of things to look at. It's all there at cardinalguide.com, as well as Hans's book, The Complete Cardinal Guide to Planning for and Living in Retirement, and of course the ever-famous contact Hans or Tom Page, because there's a lot of different. Kind of annuities, a lot of questions I would have if I was looking at these strategies. And again, easy enough, just reach out there and contact them at CardinalGuide.com. We'll be right back with a whole lot more on multi-year guaranteed annuity 2026 investment advisory services offered through Brookstone Capital Management LLC, abbreviated BCM, a registered investment advisor.
BCM and Cardinal Advisors are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents. Cardinal Advisors is not affiliated with or endorsed by the Social Security Administration or any other government agency. Welcome back to Finishing Well with Certified Financial Planner Hans Shile in today's show, multi-year guaranteed annuity MIGA for 2026, and these things are awesome way to, you know, add some diversity to your portfolio, right, Hans? Yeah, and so look, we wouldn't even be talking about them.
If the interest rates were not substantial, so let's just go like what we got here on the board. The three-year duration, five point seven six percent, is the best we got from an A-rated company. The five-year duration, six point zero three percent. The seven-year duration, six point two five percent, and the ten-year duration, five point eight percent.
So. You know, when we're the most people that buy these, or the they've already got the money invested, and then a lot of people at retirement and after are at sixty forty portfolios. You know, they're at sixty percent stocks or equities, and they're at forty percent bonds, fixed income, safe safer money. And so, when you start looking at your bond portion of your portfolio, and people find that they're not really making a lot of money on their bonds, they're not supposed to. And a lot of bonds these days, after they deduct the fees out, you know, are going to be yielding about four percent.
Some of them less than that, maybe some a little more, where there's some risk thrown in there. And when you can take that money. That you have in bonds, it's just already in there in your IRA or in your regular money, and you can move it to Amiga or take a piece of it and move it to Amiga and get interest rates beyond five and a half, a couple of them over six, and you can improve your return by a couple of percentage points. That's worth doing.
So, and then you can you can put several things where you affect the duration, and a lot of people go for this three-year duration, and we we write a lot of those. And the thing I want to caution them is interest rates are so good right now. Is if you think they're going to be about the same in 2029 when this thing comes due, and you have it, but what if the interest rates in 2029 are three and a half percent? Like they were a few years ago. I mean, so all of a sudden you're going to say, "Boy, I wish I had taken a longer term." So, you know, with the duration, it's just something to look at.
That interest rates, in my opinion, are, you know, on the on on the high side. Just looking historically, and I think that, you know, locking up some of your money for a longer period of time. To get even more interest rate, kind of makes sense, but everybody's different.
So it seemed like what I saw on the board. Are there some of them that are ten year? Yeah, yeah, and we we we've got a lot of people lock them in for ten years, just for the reason I was just talking about. Is pretty savvy investors that have most of their money in stocks, and then those stocks have done really well. And then it makes them a little nervous.
They're wondering, like, you know, should I be diversifying a little bit? Should I get a little more of my percentage now into fixed income? But then they look at the low interest rates on the fixed income, or the low yields, or whatever you want to call them, and they they want to protect some of their gains, is what it really amounts to.
So they'll. We've had a number of people that'll, you know, on our advice, that'll take like ten percent, twenty percent of their portfolio, and then they'll lock it up for ten years. And you know, it's just, it's a small part of the whole thing. And then they have a known. It doesn't matter what interest rates do in the next ten years, because this is what they got.
Okay, and then. Other people say I don't want to go to that extreme, and then we kind of spread it out.
So, and you can do less than a hundred thousand. You're going to get a little smaller interest rate than I'm quoting here, but you know, just call us up if you've got some money that you'd like to make a little more yield on, and we're not going to sell these to everybody. I mean, if they're appropriate for you, we'll recommend them, and then we'll sell it to you. Yeah, that's because, like you say, that you know, there's a different interest rate for all the different kinds, and there's different ratings, and you know, a lot to talk about. But you know, it's it's undoubtedly a an idea a lot of folks you know had not really explored in the past.
So I love it.
Okay, so let's let's go over a few bullet points here. Number one, you can put IRA money, or you can put regular savings. And if you put regular savings in here, just understand that the interest earnings, as long as you don't pull them out, are tax deferred.
So this is a good way to move taxable money around. If somebody's before retirement, you know they they and they're paying taxes on the earnings inside of their money market account. Or even if they're in retirement, and that's driving up their Irma charges or whatever, they don't really need the money right now.
So we're going to take some of that money, put it in a MIGA, get a better interest rate, and then postpone the taxes. And then we'll bring it in as taxable money in a year that's a little more favorable in the future.
So the interest can be paid out monthly. That's another thing that.
Some people like if you had a hundred thousand dollars that you put in one of these things for five years and you're earning six percent interest, and you know that's about six thousand a year or five hundred bucks a month.
So you could you could set this thing out, put your hundred thousand in the MIGA, and they'll send you a check for five hundred bucks every month for five years.
Now you're gonna have to pay taxes on that. Six hundred bucks or five hundred bucks every month, or six thousand a year, but it's not going to change. It's not going to go up. Not going to go down. And then at the end of the thing, you take your hundred thousand dollars out.
Pretty simple.
Some of your money market funds. We have a lot of people that are sitting on cash. There's a lot of retirees that don't spend. As much as they could, and you know that's a good thing. But we have a lot of people that they come in and we're doing financial planning, and they're just holding too much cash.
And we ask them why, and they say, "Well, I just like that it's there." Well, and so that's good reason for an emergency fund.
Some of them are too large, and they still like that it's there. They like that it's in cash. They like that it's not invested in stocks. You can't go up and down. And they're not making much interest on it.
Well, maybe sometimes we take half of it. You know, so somebody has three hundred thousand dollars in various money market accounts and their checking account.
Well, then we take one hundred and fifty thousand of that and put it in a in a short term MIGA where they've got some limited access.
Now they're not paying taxes on the interest. And they're getting a much better interest rate. We talked about the MIGA ladder earlier, which is just a a system of setting up the duration or the term. And you know, a lot of people have set up CD ladders before, where they're taking an equal amount of money and buying a two-year, a three-year, a four-year, a five-year, and a six-year. And it's all around the five-year MIGA.
And so, starting in two years, you got money coming at you or available to you every year. And if they don't need the money, which they probably won't, that's why they have it in the first place. They just keep rolling those things forward, and they're getting a much higher interest rate than they would on just sitting on cash that they got in the bank. You know, there's an early surrender penalty on these things, and it usually goes under a schedule of if you surrender the whole thing in the first year, it'd be an eight percent penalty. The second year, seven percent; third year, six percent; fourth year, five percent; fifth year, four percent.
And then you spread. If you took the money at the end of the thing, there is no penalty.
So you play by the rules; you'll never pay a penalty. But if you all of a sudden say, "I want my money back," you're going to pay a pretty stiff penalty. For terminating the thing early, but you still get ten percent if you want it every year, right? On some of them, okay.
Some of them you get ten percent.
Some of them you have to buy the ten percent.
So some of them are going to. You have to take a little lower interest rate, and then you have the right to the ten percent.
Some of them don't give you that option. But you can always take the interest. The ones that don't give you the ten percent rule, they'll let you take the accumulated interest out without penalty.
Well, so those are more the good questions to ask when you're setting yours up based on, you know, your possibility of need of the money that was in there. Again, another reason why you don't put all your money in that basket, right? Yeah, and you know the thing to understand is the insurance company themselves—they're taking very little risk on these things.
Okay, I mean, so so they're not like a real exciting product to talk about. That it pays out all this amount if you die, and it pays out all this amount if you get sick. None of that. It's just what you got is exactly. Clear is you put in the money, that's principal.
This is the interest rate you're going to get, and you're going to get it for as long as the term that you set up. And there's really not much more to it than that. And so we seldom sell these to people just all by themselves. Just one thing. I mean, these are usually part of an overall financial plan where we're taking part of a person's money and putting in there.
Yeah, that's beautiful. And again, I, I love the idea that they're so flexible in so many different ways. Like, like you said, you can get the interest every month if you need it. You can set up in different increments, you know, based on your need. And again, play the the idea of what the interest rate is going to do to some extent as well, right?
Well, it is, and a lot of these. What's happening now is we've been real active in the MIGA, selling MIGAs to clients for years, and so we have a lot of these five-year MIGAs coming due, you know. And so we go out and see the people, and a lot of times people are rolling them into another annuity at the end of five years. That's going to do something specific like long-term care, or like income.
So there's all kinds of things we can do at the end of the term, where we can take the money if you don't need it, and you just don't really get too excited about just buying another five year and just postponing it even further. Perhaps we could roll it into a long-term care annuity. Then that then that would provide. Long-term care benefits for you. In the future, we want to remind you.
You can find all this information at CardinalGuide.com. If you go to CardinalGuide.com, you're going to find the Seven Worry's tab, and the Seven Worry's tab today is under Income Investment. You click on that, you're going to find a video along these same lines. Show notes. You know, it's got all the things that we talked about.
Plus, oh, you can go to CardinalGuide.com and get Hans's book as well, the Complete Cardinal Guide to Planning for and Living in Retirement. And a workbook that goes with that, and the contact Hans or Tom Page, and so it's all there at CardinalGuide.com. Thanks, Hans. Great show. Thank you, and God bless you.
Any comments regarding safe and secure products and guaranteed income streams refer only to fixed insurance products. They do not refer in any way to securities or investment advisory products. Fixed insurance and annuity product guarantees are subject to the claims paying ability of. The issuing company and are not offered by Brookstone. The opinions expressed by Hans Shile and guests on this show are their own and do not reflect the opinions of this radio station.
All statements and opinions expressed are based upon information considered reliable, although it should not be relied upon as such. Any statements or opinions are subject to change without notice. Investments involve risk, and unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results. Any strategies mentioned may not be suitable for everyone.
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