The Best Variable Annuities

Annuity.org’s picks for the best income annuities include products from Nationwide, MassMutual and Fidelity Investments. These annuities offer features like guaranteed income riders, broad investment choices and various customization features for any retirement plan.

Stephen Kates, CFP®
  • Written By Stephen Kates, CFP®
    Stephen Kates, CFP®

    Stephen Kates, CFP®

    Principal Financial Analyst for Annuity.org

    Stephen Kates, CFP® is a personal finance expert specializing in financial planning and education. He serves as the Principal Financial Analyst for Annuity.org, where he delves into industry trends to support consumers and financial advisors on wealth management, annuities, retirement planning, and investing.

    Read More
    and John Stevenson, CFF
    John Stevenson, CFF

    John Stevenson, CFF

    Owner and Advisor at Stevenson Retirement Solutions

    John Stevenson, a Certified Financial Fiduciary®️, specializes in securing retirements with tax-free accounts. With a focus on guaranteed retirement, he's ensured none of his clients suffer from market fluctuations. As a renowned educator and podcast host, John empowers thousands weekly, sharing his expertise in minimizing taxes and protecting against financial downturns.

    Read More
  • Edited By Michael Santiago, CRPC™
    Michael Santiago, CRPC™
    Headshot of Michael Santiago, senior editor for Annuity.org

    Michael Santiago, CRPC™

    Senior Financial Editor

    Michael Santiago is a skilled writer and editor with over a decade of experience in various industries. As a senior financial editor, he collaborates with a team of experts to develop compelling and accurate content.

    Read More
  • Reviewed By Aamir M. Chalisa, MBA, LUTCF, MDRT
    Aamir M. Chalisa, MBA, LUTCF, MDRT
    Aamir M. Chalisa, MBA, LUTCF, MDRT

    Aamir M. Chalisa, MBA, LUTCF, MDRT

    General Manager at Futurity First Insurance Group

    Aamir M. Chalisa is the GM at Futurity First, leading Oak Brook's top branch. With 30+ years' expertise, chairs GAMA Global, driving diversity worldwide.

    Read More
  • Updated: December 4, 2024
  • 4 min read time
  • This page features 6 Cited Research Articles

Best Overall Variable Annuity: Nationwide Destination Future

Nationwide Destination Future

Nationwide logo
Product Details
  • Minimum Premium: $15,000 
  • Maximum Premium: $1,000,000
  • Issue Age: 90 y/o maximum age for annuitant and annuitization; Other optional benefits may have age restrictions.
  • Product Fees: 0.95% (0.85% M&E, admin 0.1%) and a $30 annual charge (waived over $50,000 contract value); investments have separate fees. Administration charge waived for over $1M contract value

Pros

  • Base product fees are lower than other comparable variable annuities and can fall further at certain premium tiers
  • Over 100 investment options are available to choose from
  • Five optional riders available for further customization

Cons

  • Rider fees vary depending on the timing of issuance and whether the ownership is single or joint
  • Investment expense ratios are high relative to alternative options available in the typical brokerage account
  • If a GMIB rider is attached, the income is often lower than what a FIA with an income rider would provide

Our Take

The Nationwide Destination Future annuity was selected as the “Best Overall” variable annuity because it offers a blend of premium variable annuity features, including broad investment options and various optional riders for income and death benefits. Some investment-only variable annuities have lower product costs but do not offer any added features or riders for protection which are the heart of why investors should choose a variable annuity over a retirement account like an IRA. 

Product costs for the Nationwide annuity are more affordable than most competitors. Like most variable annuities, the mutual funds available carry higher expense ratios than comparable mutual fund classes in a brokerage account. This can add to the overall cost of the investment and should be incorporated into any cost assumptions before purchase. 

Overall, the Nationwide Destination Future variable annuity is an excellent option for investors seeking tax deferral, growth and optional income or death benefit protection.

Variable annuities for my clients have provided the balance between risk and growth potential while still providing a level of protection, especially using guaranteed minimum income benefit. A variable annuity is a good fit amongst other financial products and I generally include them in the planning process.  

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What is your goal for purchasing an annuity?

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Best Variable Annuity for Lifetime Income: MassMutual Envision

MassMutual Envision

MassMutual logo
Product Details
  • Minimum Premium: $5,000 (qualified) and $10,000 (non-qualified)
  • Maximum Premium: $1,500,000
  • Issue Age: Age 90 with no minimum age; Age 45 to 80 with RetirePay rider
  • Product Fees: 1.30% (1.15% M&E and 0.15% administration fee); $40 maintenance fee on contracts under $100,000

Pros

  • Low $5,000 minimum initial premium for qualified accounts
  • The RetirePay rider offers high payout rates, increasing with each year that income is deferred 
  • Investment earning withdrawals are not subject to the surrender schedule

Cons

  • Product costs are higher than comparable variable annuities
  • Income rider limits investment options and additional premium payments after first year

Our Take

The MassMutual Envision annuity was chosen for its guaranteed income-producing capabilities. Income payout rates increase with each year that income is deferred following the purchase of the contract. Investors who can plan years ahead can expect competitive payouts that rival income-only annuities. 

Product costs for MassMutual are average, but investment costs are below average for similar variable annuities. The costliest fund expense is 1.50% which is well below the costs of other variable annuities. Investors who may be interested in actively managed mutual funds focused on growth, sectors or tactical strategies will find these options less costly within this product than other variable annuities. All annuity costs should be considered holistically, including base product, investments and riders. 

Overall, the MassMutual Envision variable annuity offers a healthy mix of protection, income and strong financial backing from a quality insurer.

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Overwhelmed by Safe Retirement Options?

Compare annuities and CDs to find the best fit for you and your loved ones.

Best Variable Annuity for Cost-Sensitive Investors: Fidelity Personal Retirement Annuity

Fidelity Personal Retirement Annuity

Fidelity logo
Product Details
  • Minimum Premium: $10,000
  • Maximum Premium: Fidelity Discretion 
  • Issue Age: 18 years old
  • Product Fees: 0.25% product fee (0.10% for $1M+). Fund costs average 0.66% and range from 0.09% to 1.48%. 

Pros

  • Low costs are the best reason to choose this investment-only variable annuity
  • Investment options are broad and fund costs are below average compared to the typical variable annuity

Cons

  • The contract offers no riders or additional features

Our Take

No other variable annuity could claim the title of lowest-cost variable annuity. The Fidelity Personal Retirement Annuity starts out with a product cost of only 0.25%, which falls to 0.1% for contracts over $1M. While this annuity offers no riders or additional features, it is perfect for investors comfortable investing in the market without guarantees. This annuity is ideal for investors who want to shield taxable money from investment income or have maxed out all other retirement savings vehicles and want to contribute more. 

Please seek the advice of a qualified professional before making financial decisions.
Last Modified: December 4, 2024
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