Select Choice 7-Year review

It depends on the buyer. For someone who genuinely has seven-year money, wants a locked rate, and values the A- AM Best carrier rating, this is a solid product. The rate banding structure means larger deposits at $100,000 or above earn a better rate, so this gets more competitive as deposit size increases. It is less attractive for anyone who might need to access funds during the term, anyone shopping primarily on liquidity, or anyone who has not thought through MVA risk — the surrender cost is not just the printed percentage.

The rational case for Select Choice 7-Year is simple: someone has a sum of money they will not need for seven years, wants certainty about the rate, and wants to avoid the crediting complexity of a fixed indexed annuity. At the $100,000 threshold, the rate steps up slightly, which makes the seven-year version particularly interesting for larger deposits. The longer duration also suits buyers in a declining-rate environment who want to lock in today's rate for as long as possible, with the understanding that MVA cuts both ways — it could reduce or increase the effective surrender cost depending on what happens to rates.

I think Select Choice 7-Year is best suited to retirement savers in their late 50s or early 60s who are rolling over IRA or 401(k) money they are confident they will not need to touch before the guarantee period ends. Non-qualified buyers looking to defer taxes on fixed-income gains are also a reasonable fit. The wide issue age range — qualified accounts up to 85 — means it works for older buyers too, though anyone above 78 should think carefully about the seven-year horizon relative to their actual planning timeline.

This is a poor fit for someone who expects to draw income from the annuity, someone who might face a liquidity need in years 2 through 6, or someone who is hoping this product will do something beyond accumulating at a fixed rate.

You are buying a seven-year rate guarantee from an A- rated insurance company. The mechanics are as close to a bank CD as an insurance product gets: one premium, one rate, one term. At the end of the seven years, you get your money back plus all credited interest, with no taxes owed along the way on non-qualified money. What you are giving up in exchange is access — the base contract has no free-withdrawal provision, which is more restrictive than many competitors in this space. The rate is declared at issue and does not float, does not depend on index performance, and does not change unless you reach the guaranteed minimum floor, which sits at 1%.

Select Choice 7-Year credits a fixed declared rate for the full seven-year guarantee period. As of the brochure data (9/22/2025), the credited rates are 4.95% for deposits below $50,000, 4.95% for the $50,000 band, and 5.15% for deposits at or above $100,000. Those rates are locked in at issue and do not change for the life of the guarantee period. The lifetime minimum guaranteed rate is 1%, which is the floor the contract can never go below — current declared rates are well above that floor, but it is the contractual backstop.

At the end of the seven-year period, there is a 30-day window to surrender penalty-free or roll into a new guarantee period. If you do nothing, the contract re-enters a five-year subsequent guarantee period. That auto-renewal feature is standard in MYGAs but worth noting — after the initial term, the new rate is set at whatever the carrier declares at that point.

Rate banding is a meaningful part of the value proposition. The $100,000 threshold earns a 20-basis-point premium. For larger deposits, that adds up over a seven-year horizon.

The optional Waiver of Withdrawal Charge and MVA Rider — what S.USA Life calls the Select Choice 3 option — adds two things the base contract lacks: a 10% annual free-withdrawal provision after year one, and waivers for terminal illness and nursing home or hospital confinement. The cost is a reduction of 0.15% on the credited interest rate.

Whether that tradeoff is worth it depends on the buyer. If there is any realistic chance of needing liquidity or qualifying for a confinement waiver, the 15-basis-point rate reduction is a reasonable premium to pay. If the money is truly locked away and the buyer is in good health, the base contract delivers a cleaner yield. The rider also covers SEPP withdrawals, which matters for IRA holders who might use a 72(t) distribution schedule.

The base Select Choice 7-Year contract has no free-withdrawal provision. That is an important distinction from most competitors, which typically allow 10% annually starting in year two. It is not disqualifying for the right buyer, but it is not the norm.

Beyond that, the surrender schedule starts at 7% in year one and steps down by one point per year, reaching 1% in year seven, then zero at maturity. That is a relatively gradual slope — a 7% starting charge is lower than the 8–10% common on longer-duration FIAs.

What matters more here is the MVA. A Market Value Adjustment — an interest-rate-based adjustment to your surrender value — applies on top of the withdrawal charge. In a rising-rate environment, the MVA can increase your effective surrender cost above the printed charge. In a falling-rate environment, it can reduce it. The MVA makes early surrender a function of market conditions, not just the schedule. Buyers who understand that dynamic and are genuinely committed to the seven-year term will not be affected. Buyers who might exit early should model the MVA risk before committing.

The base contract carries no annual fee. There is no administrative charge, no asset fee, and no mortality expense. The only cost embedded in the base contract is the spread between what S.USA Life earns on its investment portfolio and the rate it credits to you — that is how all MYGAs work, and it is not disclosed as an explicit fee.

The optional riders reduce the credited rate: the Return of Premium Rider costs 0.20%, the Waiver of Withdrawal Charge/MVA Rider costs 0.15%, and taking both together costs 0.25% — a slight discount versus buying each independently. These are the only explicit fee-like costs in the product, and they are opt-in.

The main structural tradeoff is the combination of no free withdrawal plus an MVA. That pairing makes this product more restrictive than many competing MYGAs, and buyers should weigh it honestly against products that offer 10% annual liquidity without MVA.

Legal Entity: S.USA Life Insurance Company, Inc.

Parent: Prosperity Life Group

AM Best Rating: A-

S.USA Life is issued under the umbrella of Prosperity Life Group, a mid-sized holding company. The A- AM Best rating is a respectable indicator of financial strength — it sits comfortably within the investment-grade tier that most financial advisors use as a minimum threshold for MYGA placement. It is not a top-of-market Aaa-level rating, but for a seven-year fixed commitment with a $5,000 minimum, the carrier's financial strength is an appropriate consideration rather than a dealbreaker.