I had posted this in the Ask a Question section, and someone referred me here. I hope this is the right spot.

My grandmother left me a fixed annuity about 8 years ago. She had used all the principal from it. There is still a sizable amount, and I've withdrawn from it once or twice (emergencies) and paid the extra 10% penalty for not being at least 59 1/2 (another 20 years away).

Every year I get a statement from the annuity company telling me what the interest rate is for the coming year (this year 6.6%). I think I would do better to surrender the annuity, take the tax bite, and invest the difference myself. Am I right? Would I do better to take a little each year to invest, and spread out the tax pain?

Any information/comments are appreciated. Thanks.