There are a wide range of insurance and annuity products available through Liberty Bankers Life, including fixed and immediate annuities, Medicare supplemental health insurance and whole life insurance. The company can trace its history back to 1958, when it was originally founded under the name Royal Oak Life Insurance Company.
Annuities are a complicated topic, so don’t be afraid to ask for help if you don’t know what’s best for you. If you have questions, SmartAsset’s financial advisor matching tool can pair you with knowledgeable advisors in your area.
| Annuity | Fees | Annuity Type | Minimum Initial Premium | More Information |
|---|---|---|---|---|
| Bankers Elite Series Find an Advisor |
| Fixed annuity | $10,000 | Annuity TypeFixed annuityMinimum Initial Premium$10,000 |
| Liberty Bankers Life SPIA Find an Advisor |
| Single premium immediate annuity | $25,000 | Annuity TypeSingle premium immediate annuityMinimum Initial Premium$25,000 |
| Liberty Select Find an Advisor |
| Fixed annuity | $5,000 | Annuity TypeFixed annuityMinimum Initial Premium$5,000 |
| Bankers 5 Premier Plus Find an Advisor |
| Fixed annuity | $10,000 | Annuity TypeFixed annuityMinimum Initial Premium$10,000 |
As part of their evaluation processes, insurance companies receive financial strength ratings from outside sources. A.M. Best, one of the top ratings companies on the market, recently rated the company’s strength at a B++, which is the fifth-highest score on its scale and corresponds to “Good-Excellent.”
Bankers Elite Series
The Bankers Elite Series comes in four variations: Bankers Elite 3, Bankers Elite 5, Bankers Elite 7 and Bankers Elite 9. Each of the numbers associated with these annuities refers to the length of the interest rate guarantee period for the contract, as well as the withdrawal charge schedule. These work similar to certificates of deposit (CDs).
All four contracts have a $10,000 minimum initial premium, but the maximum issue ages vary:
- Bankers Elite 3 & 5: 90 years old
- Bankers Elite 7: 85 years old
- Bankers Elite 9: 80 years old
The death benefit for this contract is equal to your account’s value at the time of your passing. If you have a surviving spouse, they can elect to carry on your contract as the new annuitant.
Fees
While this series of annuities doesn’t have any annual fees, there are withdrawal charges if you take out any money before the conclusion of your interest rate guarantee period:
| Withdrawal Fee Schedule | |||||
| Product | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
| Bankers Elite 3 | 7.9% | 7% | 6.2% | 0% | |
| Bankers Elite 5 | 7.9% | 7% | 6.2% | 5.3% | 4.4% |
| Bankers Elite 7 | 7.9% | 7% | 6.2% | 5.3% | 4.4% |
| Bankers Elite 9 | 7.9% | 7% | 6.2% | 5.3% | 4.4% |
| Withdrawal Fee Schedule | |||||
| Product | Year 6 | Year 7 | Year 8 | Year 9 | Year 10+ |
| Bankers Elite 3 | |||||
| Bankers Elite 5 | 0% | ||||
| Bankers Elite 7 | 3.5% | 2.7% | 0% | ||
| Bankers Elite 9 | 3.5% | 2.7% | 1.8% | 0.9% | 0% |
If you withdraw from your annuity before age 59.5, you’ll incur a 10% income tax penalty. This is in addition to your standard income tax rate.
Realistic Return Expectations
The longer the contract you choose, the better the interest rate you’ll receive. Here’s what Liberty Bankers Life is offering as of Feb. 2021:
- Bankers Elite 3: 2.15%
- Bankers Elite 5: 3.00%
- Bankers Elite 7: 3.00%
- Bankers Elite 9: 3.00%
Liberty Bankers Life SPIA
The Liberty Bankers Life SPIA offers regular income payments based off a minimum initial premium of at least $25,000. At contract issue, you can pick from monthly, quarterly, semi-annual or annual payment schedules.
This contract comes with a few different income options, including:
- Period certain: You or your beneficiaries will receive payments for a period ranging from 5 to 30 years, with beneficiaries continuing to receive payments after your death for the remainder of the period.
- Life income: Keep getting payouts for the rest of your life, or for the rest of your life with a backup period certain of 5, 10, 15 or 20 years.
- Joint income/qualified joint income: This allows you, your spouse or both of you (depending on who’s alive) to receive payments.
Annuitants who go with the period certain option will have a maximum issue age of 90, whereas all other options come with an 80-year-old maximum issue age.
Fees
As this is an annuity built around income, there are no annual fees or withdrawal charges.
If you’re under 59.5 years old and you make a withdrawal from your contract, the IRS will levy a 10% income tax penalty on you. You will be on the hook for standard income taxes as well.
Realistic Return Expectations
The size of your payments will depend on your premium amount, the income option you select and the frequency with which you’d like to receive them. Therefore, it’s difficult to pinpoint the kind of returns you’d receive without knowing specifics.
Liberty Select
The Liberty Select fixed annuity is fairly accessible even for those without a lot of money, as its minimum initial premium is just $5,000. Prospective annuitants up to age 85 are eligible to open an account.
Like any fixed annuity, your contract will grow based on a predetermined rate that’s chosen by Liberty Bankers Life. A major benefit of this annuity, though, is that annuitants receive a 1.50% rate bonus for the first year of their contract’s life. There are also market value adjustments (MVAs) with this contract.
The death benefit for this annuity is standard: Your beneficiaries will receive an amount equal to your contract’s accumulated value, if it's before you've annuitized.
Payout options with this annuity include:
- Life only: Payments last for the rest of your life.
- Life with 10 years certain: Payments last for the greater of 10 years or your life.
- Fixed period payments: Payments last for a specific period of time.
Fees
There are no annual fees with this annuity.
If you need to make an early withdrawal from your account, Liberty Bankers Life lets you take out as much as either what you’ve earned that month in interest (if $100 or more) or your accumulated interest twice a year. Anything above these amounts is subject to the following withdrawal charges:
| Withdrawal Fee Schedule | ||||||||
| Your Age | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8+ |
| Up to 55 | 12% | 11% | 10% | 8% | 6% | 4% | 2% | 0% |
| 56 and up | 8% | 7% | 6% | 5% | 4% | 3% | 2% | 0% |
The IRS’ 10% income tax penalty is waiting for any annuitants that withdraw from their account prior to turning 59.5 years old. This is in addition to your standard income tax rate.
Realistic Return Expectations
The Liberty Select fixed annuity comes with a lone fixed interest rate, alongside which your money will grow over time. However, the company is currently not releasing fixed rates for this annuity. However, your minimum guaranteed fixed interest rate will be 1%.
Bankers 5 Premier Plus
The Bankers 5 Premier Plus contract is the top-tier variation of Liberty’s “Bankers Series” of fixed annuities. At 3.55%, it features the highest interest rate available at the company as of Feb. 2021, though this only lasts for one year. For the second through fifth years of your contract’s life, this interest rate will shrink to 2.55%, though even that still falls in the upper echelon of what Liberty currently has to offer.
In order to open this account, you must have at least $10,000 ready to invest. The only other requirement is that you are 90 years old or younger, as that’s the maximum issue age.
This contract provides a standard death benefit that’s equal to the accumulated value of your account. There are no death benefit riders available to upgrade this.
Fees
There are very few upfront costs with this annuity, as it has no fixed-rate or percentage-based annual contract fees.
The five-year guaranteed interest rate period you receive with this contract also acts as your withdrawal fee schedule. Although Liberty Bankers Life lets you take out your accumulated interest twice a year or your monthly interest if it’s $100 or more, withdrawals above these caps will induce extra charges.
| Withdrawal Fee Schedule | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6+ |
| 8.1% | 7.3% | 6.4% | 5.5% | 4.5% | 0% |
If you’re younger than 59.5 years old, the IRS will charge you a 10% income surtax on any annuity withdrawals. This is in addition to the standard income tax you pay on annuity income.
Realistic Return Expectations
The 3.55% interest rate associated with this contract as of Feb. 2021 is about as good a rate as you’ll find from Liberty Bankers Life. However, during the last four years of your five-year guarantee period, this percentage will drop to 2.55%, which is still a solid rate.
Tips for Building an Investment Portfolio
- If you want some help managing your retirement income planning, consider working with a financial advisor. Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in 5 minutes. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.
- Risk tolerance is one of the most important factors to take into account when investing. The best way to utilize your risk tolerance in a practical sense is to formulate a risk-adjusted asset allocation that dictates what percentages each type of security will occupy in the grand scheme of your portfolio. SmartAsset’s asset allocation calculator can help you get started.
All information is accurate as of the writing of this article.
