Investing Disappointment

By | 13th August 2018

Yes, I had Bitcoin, yes I almost lost the money. I came out even. I’m happy with that. It was a risk and the money was not huge. This story is not about that. This is about two policies with Liberty.

So back in April 2013 I decided to take out two Education Builder (Mod Agg) policies, one for each of my children with the intention of continuing to pay them after they matured after five years. By the time I needed them for their studies they would have been fairly substantial and helped a lot with paying the fees. In April i got a notice from Liberty that the two policies had matured.

On the 30th of July I received the paperwork to actually get my money out of the policies which I duly submitted and they paid out.

Here is the problem, lets take one policy at, lets say, R100 per month. That gives me the payment of R100 x 12 = R1 200 invested for the first year. There was a 5% annual increase (I was theoretically making that increase in salary) so the second year was R1 260, the third year R1 323, the fourth year R1 389.15, the fifth year R1 458.60 and the year up to now would have been R638.14. There is an inception fee which is not in this calculation but lets say there wasn’t.

This means over the life of the policy, from one of their Financial Advisors, I would have paid R7 268.90. The payout I received this week would have been equivalent to R7 091.36. This gives me a total growth on my investment of -2.5%.

If I had put the money under my mattress I would have had a better return of 0%

If the investment had growth of 5% per annum (which is fairly modest) the return would have been R8 314.14. 

So it seems that Liberty stole money. I have officially given them 6 days to investigate and respond (they have confirmed receipt of the complaint, responded with a reference number and manually assured me that it has been forwarded to the correct department for investigation. There has been no response to date.