Investment Certificates
SBM’s Investment Certificates, known as
Face-Amount Certificates, offer competitive yields with greater flexibility
and more purchase
options than do typical bank CDs. SBM’s Certificates allow the investor
to take advantage of higher interest rates, fixed terms and investment
security.
Understanding Face-Amount Certificates
A Face-Amount Certificate is
a fixed-income security issued by a face-amount certificate company,
a type of investment company similar to a mutual fund. These certificates
have been issued
by various companies since the early 1900s.
With an Installment Certificate, the investor makes periodic contributions
to the Certificate for a specified period of time that will equal
the investment amount value, established at the time the Certificate
is issued. Interest accrues on the amount paid-in each month at the
stated rate.
With a Single-Payment Certificate,
the investor purchases the Certificate for its principal, or face-amount,
for a specified period of time—generally
three, five, seven or ten year guarantee periods. Interest accrues
on the full amount at the stated rate and can be compounded annually
and paid at the end of the guarantee period, paid quarterly or paid
annually. The Issuer agrees to pay the principal investment
plus any accrued interest at the end of the guarantee period.
Federal law requires the
Certificate Issuer to maintain reserves for the amounts
of the certificate obligations with
a third-party custodian at all times. These reserves consist of
a highly diversified pool of generally high quality equity and fixed
income securities,
real estate and mortgage loans. The custodial requirement serves
as added security for the purchaser of the Certificate.
Face amount certificates are issued by face-amount certificate
investment companies and are sold primarily by broker-dealers nationwide.
Certificates are not traded on exchanges, and therefore do not have
market values that fluctuate in response to changes in interest rates or other
economic data. Consequently the value of the certificate, including
accrued interest, remains fixed for its entire guarantee period.
Face-amount certificates are liquid in that they may be surrendered
back to the Certificate Issuer for their principal account value,
plus interest, less applicable withdrawal charges.
Benefits of Investing
in Face-Amount Certificates
No Front End Sales Charge
When a Certificate is purchased, 100% of the investment amount
begins to earn interest.
Higher Than Typical Market Yields
SBM Certificates generally offer interest rates that are higher
than those offered by typical bank CDs and fixed annuities for terms
of comparable durations.
Low Minimum Investments
SBM Investment Certificates can be purchased for as little as $1,000.
Secured Investment
SBM Certificates are backed by reserves, consisting
of a diversified pool of generally high quality equity and fixed
income securities,
real estate and mortgage loans. The reserves are held by a third-party
custodian who maintains at all times qualified assets equal to the
total of the certificate obligations.
Investment Certificates at a Glance
|
Certificate Series/Type
|
503 Fully Paid
|
505 Fully Paid
|
507 Fully Paid
|
510 Fully Paid
|
Hypothetical amount invested
(Minimum amounts are $1,000 if interest
compounded annually or paid annually and $5,000 if paid quarterly)
|
$50,000
|
$50,000
|
$50,000
|
$50,000
|
|
Guarantee Period
|
3 years
|
5 years
|
7 years
|
10 years
|
|
Hypothetical interest rate
|
5.75% |
6.15% |
6.40% |
6.75% |
|
Hypothetical total return at the end of the guarantee period
|
$59,130
|
$67,386
|
$77,190
|
$96,084
|
Certificate Terms
- Three-year guarantee period
- Five-year guarantee period
- Seven-year guarantee period
- Ten-year guarantee period
Certificate Interest Disbursement Options
- Interest paid quarterly
- Interest paid annually
- Interest compounded annually and paid at the end of the guarantee period
Types of Accounts Accepted
- Regular Investment Accounts
- Retirement Accounts
- Rollover Accounts
- Pension and Profit Sharing Accounts
- Trust Accounts
- Educational Accounts
Face-amount certificates are not bank products, equity investments, annuities
or life insurance products, and are not guaranteed or insured by the FDIC,
any governmental agency or fund, or private third party. A withdrawal charge
is applicable if a withdrawal or full surrender is made prior to the end of
a guarantee period of the certificate chosen.
For more complete information about SBM Investment Certificates or to locate
an authorized representative, please call toll free 888-749-4353.
Certificates Are Sold by Prospectus Only.
Back to the top
|
