Both fixed annuities and bank CDs offer principal protection and a guaranteed interest rate for a set term. Key differences: fixed annuities grow tax-deferred (CDs are taxed annually on interest earned), fixed annuities are not FDIC insured (CDs are), and fixed annuities often offer higher rates for comparable terms. Fixed annuities pass to beneficiaries outside of probate; CDs typically do not. Both carry early-withdrawal penalties, though the mechanics differ.