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Central Bank has been in business since 1902. Find out why this IRA provider has such a strong presence in America's Midwest.
Pros:
- In business for more than a century
- Strong presence in the Midwest
- Wide variety of financial services outside of IRAs
Cons:
- Doesn’t specialize in just IRAs
- Doesn’t offer cryptocurrency
Central Bank sounds like a big name. A total heavyweight or titan in the IRA industry. While we won’t go as far as to say that it’s not a heavyweight, the name central bank is a little bit misleading. First of all, it’s literally just a bank, not an actual central bank that sends hundreds of millions of dollars to other central banks around the world.
Central Bank as an IRA provider is mostly popular around the Midwestern United States with 140 locations set up in smaller communities around that region of the country. The organization prides itself on offering clients the ultimate in flexibility and personalized service. They aim to give clients the convenience and technology they would expect from a major bank in smaller local communities that normally don’t get that kind of service. That’s Central Bank’s value proposition.
Unlike other IRA providers, Central Bank is about more than just retirement. It’s literally a small network of banks. Central bank offers personal banking, business banking and all kinds of mortgage related products and services in addition to taking care of the retirement plans of its customers.
What is Central Bank? What is a Central Bank IRA?
Again, Central Bank has 140 locations across the Midwestern United States. They focus on local communities and do not compete with big banks or big discount brokerages as far as investing goes. Central Bank is really a full-service financial institution, not an investment specific organization.
As far as Central Bank IRAs are concerned, clients can expect to benefit from both a Traditional IRA and Roth IRA. Central Bank also offers the opportunity to invest in certificates of deposit, brokerage services and trust services.
About The Founders and Management Team of Central Bank
Lon Stephens created the Central Missouri Trust Company in 1902. He served as Treasurer of the State and Governor until 1901. It makes sense then why Central Bank is so dedicated to the Midwest. Stephens wanted it that way. Sam Baker Cook took over as president of the Central Missouri Trust Company in 1905. Cook ran the company until 1931, the year he died.
His son Howard took over the company throughout the Great Depression and he managed to develop a special relationship with the state government because the third-generation Cook lent over $1 million to the government who was struggling to cover payroll for state employees.
Howard then passed over the operation of the bank to his son, Sam B. Cook in 1961. The bank was renamed Central Trust Bank in 1969 in that name was shortened to Central Bank in 1987. Sam cook passed away in 2016 and now his son S. Bryan Cook is the CEO of the company.
Talk about a family heirloom! It’s obvious that Central Bank’s mission of staying closely connected to the community stems from the legacy of the founder’s family tree passing it down from one Cook to the next. Central Bank has now been serving customers for 108 years. That’s an incredible legacy.
Central Bank IRA and Investing Account Types
Unlike many of the IRA providers we’re reviewing here at Sophisticated Investor, Central Bank offers a much broader range of services as we’ve noted. When it comes to investment services, the bank’s website breaks things down into six different categories, only one of which includes retirement planning. The other categories include:
- Annuities
- Brokerage Services
- Life Insurance
- Trust Services
- Premium Services
The five services above allow investors to earn interest on their money without having to commit to a long-term retirement plan. These brokerage, trust and premium services typically come with fees for doing business as that’s how a traditional bank makes money. Remember that central bank is more than just an IRA provider. That being said, the organization does offer a few basic types of IRAs, so let’s get into it.
Central Bank Traditional IRA
A Traditional IRA at Central Bank offers immediate tax benefits to the contributor just like any other Traditional IRA. Contributions in the interest earned stay tax-deferred until retirement. Investors can contribute to a Traditional IRA without an employer having to match. This means that there is no employer or third-party administrator to put limitations on the investor’s account. It is possible to withdraw before retirement (IE. Before the age of 70 ½), but that’s usually subject to a 10% penalty.
Investors can put money into retirement as long as they are younger than 70 ½ years of age, and earn taxable income. Contributors under the age of 50 can put in up to $6,000 a year into their plan. Those over the age of 50 can go up to $7,000 a year in contributions.
Central Bank Roth IRA
There is one key difference between a Traditional IRA and Roth IRA. A Traditional IRA allows investors to write off their contributions while they are still working. This means as an investor you benefit when your income earning potential is at its highest in the middle of your career. You then also get to defer paying taxes until you withdraw your savings for your retirement.
Generally speaking, a Roth IRA is for investors who think they will have a lot of money when they retire. Investors who go this route cannot write off contributions as they make them from year to year, but they also don’t pay taxes upon withdrawal. Investors can contribute to a Roth IRA at any age and they are not obligated to withdraw after a certain age the way they would be with a Traditional IRA. They can contribute up to $6000 per year into the account as long as their gross income is below $137,000. Central Bank allows money in a Roth IRA to be moved to a Traditional IRA.
Central Bank Investing Options
Like many other banks, Central Bank mostly focuses on traditional investing options like stocks, bonds, mutual funds and certificates of deposit. They do however work with a custodian called the Depository Trust Company. Another option is to work with the Federal Reserve Bank through Central Bank. These are the bodies that allow investors to choose assets like precious metals for investing, though it doesn’t seem like central banks marketing efforts are focused on this as much as smaller IRA providers that don’t provide any other kind of financial services.
Central Bank Fees
Since Central Bank charges customers fees on all sorts of other banking, like personal checking accounts, mortgages, loans, credit cards and other banking facilities, they don’t necessarily offer the same specialized investing options as smaller IRA-only providers.
This means that customers of Central Bank will pay percentage fees on mutual funds ranging between one and 2% like they normally would any other major bank. That’s probably bad news because over a lifetime of retirement investing, one or 2% can equate to up to $300,000 in retirement savings going straight to retirement planners.
That being said the custodians that Central Bank works with are pretty reliable. It’s not really possible to get much more reliable than the Federal Reserve Bank. That said, since the alternative investing options are limited to precious metals, an initial setup fee of $50-$100 and a quarterly or yearly maintenance fee of a few hundred dollars is probably par for the course at Central Bank.
Customer Service and Support at Central Bank
As we mentioned in the beginning of this review, Central Bank hosts more than 140 branches across America’s Midwest. That’s lots of face-to-face customer service representatives and bankers available to investors. While Central Bank doesn’t necessarily maintain strong market share in the rest of the country, their goal is to dominate local communities. Like many smaller institutions in any given industry, Central Bank markets itself as offering personal service in comparison to much larger banks who may just treat the average investor like nothing but a customer number.
Central Bank offers customer support through phone, email and live chat. This means investors can speak to someone Monday through Saturday through these various mediums. These channels stay open until 6 PM during the week and 12 PM on Saturdays.
Central Bank Customer Reviews
Central Bank a 4.85 out of five star rating on a website called SocialSurvey.me. That’s a fantastic rating considering the company has nearly 600 reviews on that website. Keep in mind that all these reviews are coming from the state of Missouri or Kansas State. That’s pretty impressive. It’s obvious that Central Bank really does dominate the Midwest.
Frequently Asked Questions about Central Bank
What is Central Bank?
Central Bank is not just a self-directed IRA company. It’s a full service bank that serves the Midwest. Most of the companies 140 branches are located throughout Kansas State and the state of Missouri.
Where is Central Bank Headquarters?
Central Bank’s head office is located in Ambler, Pennsylvania.
How Can I Withdraw Money from Central Bank?
Since Central Bank is a full-service financial institution, withdrawing money is as simple as transferring it from an IRA to a personal checking or savings account. Customers pay monthly fees for a checking account wouldn’t be charged for an individual transaction. Just keep in mind that withdrawing from an IRA may have tax implications.
Where Can I Cash a Check from Central Bank?
A Central Bank cheque can be cashed right at Central Bank. Since they offer traditional retail banking there’s no need to go anywhere else or pay cash advance fees to payday loan companies.
Is There a Central Bank robo-advisor?
Central Bank offers different prebuilt investment portfolios to clients based on their level of risk tolerance.
Should You Choose Central Bank for your Self-Directed IRA?
There are a few things Central Bank really has going for it that self-directed IRA-only providers simply can’t compete with. The bank has been in business for 108 years and the leadership of the bank has been passed down from generation to generation. It’s a pretty incredible story. That alone should reassure prospective clients that Central Bank really does care about taking care of the individual and offering them personalize service within the state of Missouri and around Kansas.
Central Bank’s customer reviews are top-notch, very few IRA providers can compare in that category. The other benefit is that Central Bank offers broader financial services. That means clients can take care of their IRA and also take care of their other banking needs all in one place. Obviously IRA providers that only specialize in retirement planning won’t do that.
All of the above said, there is one distinct disadvantage to choosing Central Bank over other IRA competition. There is a lack of exotic options for investing one’s retirement funds. Other IRA providers allow investors to go beyond precious metals. Clients can become involved in private lending deals, financing mortgages, buying real estate and many other options. Again, it’s important to keep in mind that Central Bank functions like a regular bank. It’s simply a smaller version of America’s much larger financial institutions.
Still, considering all the features, advantages and benefits of choosing Central Bank over other IRA providers, investors can certainly do worse. Central Bank is a great choice for those looking to retire sooner.
- Phone : 1-(866) 236-8744
- URL :
- Global Rating
- Very Good
User Rating
- 0 No reviews yet!
Central Bank has been in business since 1902. Find out why this IRA provider has such a strong presence in America's Midwest.
