A value investor's guide to 'exploiting' the Singapore Savings Bond, Money News

Why Singapore Savings Bonds Are Your New Best Friend

Ever heard the line, “You can park your money in Singapore Savings Bonds!”? It’s not just hype – it’s a practical strategy for modern investors desperate to keep cash alive and useful.

1⃣ Peace of Mind: No Principal Loss

• Capital is safe. Your initial deposit stays intact – the only thing that can shrink is the value of money itself, not the amount you invested.
• The risk of losing your original outlay is basically a myth with these bonds.

2⃣ Sturdy Yields: Outclassing Fixed Deposits

• Competitive rates. Compared to the conventional 1.0–1.5% you get from Singapore’s top banks, SSB can hit up to 2.5% p.a. in certain years.
• Our math shows that if inflation dances at 2%, that 2.5% keeps your purchasing power on a level playing field.
• In the worst seasons, you still get a decent return – less risky than the stock market’s sentiment swings.

3⃣ Liquidity: Slip Your Money Out Anytime

• Unlike fixed deposits that lock you into 12‑month or 24‑month blocks, SSBs let you sell on demand.
• Need cash for a hot IPO? Just quick‑sell a bond and you’re out.
• So your cash stays nimble, ready for market moves without sitting idle.

4⃣ Bonus Touch: Perfect Complement to High‑Yield Savings

High‑yield accounts are great, but they often come with drawbacks like no growth-cap & early‑withdrawal fees. SSBs give you both a safety net against inflation and the flexibility to play the market when the time is right.

Bottom Line

Stop letting your money take a “sloth” break. Swap a part of your war chest into Singapore Savings Bonds for secure returns, robust yields, and the freedom to deploy whenever the next big opportunity lights up.

What are Singapore Savings Bonds?

What Are SSBs and Why You Should Care

Back in 2015, the Monetary Authority of Singapore (MAS) rolled out the Singapore Savings Bonds (SSBs). Think of them as a “bank on steroids” – except the steroids are government-backed. They’re a hands‑off, long‑term savings option that’s as safe as a flat‑packed Ikea shelf.

How They Work

• Guarantee: Your principal is protected by the Singapore government. No risk, except if you’re a hardcore punctilious about speculation and think the nation will bite the dust. (Just kidding – never mind.)
• Tenure: Each bond lasts 10 years so you can set it and forget it… for a decade.
• Age: Open to Singaporeans 18 and older. That’s essentially everyone besides toddlers.

What Makes SSBs a Big Deal

• No Early‑Redemption Penalties: Want to cash out? You can disclose the love your money held for you any time and get everything back—principle, interest, the whole shebang.
• Tax‑free Returns: The sweet interest you earn? It stays tax‑free, just like dividends. So, the more you earn, the less you give to the taxman.
• Low Entry Point: Start with as little as $500. That’s a single laptop price, not a small fortune.

Bottom Line

SSBs are the “go-to” for safety‑first savers who don’t want to lose their dough. If you’re looking for a risk‑free, flexible, and tax‑friendly way to grow a little stash (or a huge one, if you’re feeling ambitious) over a decade, give these bonds a look.

How SSBs work

Singapore Savings Bonds Explained, With a Side of Humor

What are SSBs? These nifty little instruments give you a 10‑year growth plan, with interest compounding year after year. By the time the clock strikes 10, you’ll have earned an annual rate comparable to a 10‑year Singapore Government Bond.

Interest Over Time (Feb 2019 Example)

• Year 1: 1.98% APR – split into two half‑annual payouts of 0.99% each.
• Year 2: Slight bump to 2.00%, so each semi‑annual payment is 1.00%.
• …
• Year 10: Peaked at 2.53% – you get 1.265% twice a year.

So basically, you start with a modest raise and keep getting a little more with each passing year. It’s like a savings gym, where your returns literally get stronger over time.

When to Cash Out

If you decide to redeem before the 10‑year finish line, your profits get pro‑rated based on how many days you actually held the bond. Think of it like slicing a pizza: the more slices you eat, the more you owe. Just keep in mind the interest will be adjusted to mirror the time actually invested.

Quick Takeaways

• SSBs are a 10‑year plan with interest that rises every year.
• Interest comes every six months.
• Early redemption means your earnings are scaled down.
• By year ten, the interest aligns with a 10‑year government bond.

Bottom line: If you want a friendly, gradual boost to your savings that mirrors safe government debt, SSBs are a solid pick. And remember, even the smallest step counts—just take that semi‑annual payout cookie every six months!

How to buy and invest In SSBs

Snagging SSBs: Cash or SRS?

When it comes to buying Singapore Savings Bonds (SSBs), you’ve got two legit avenues: pay with a hard‑cash dollar or tap into your Savings Reserve Scheme (SRS) account.

Why We’re Team Cash

We’re sticking with the cash route here because our strategy is simple: park your money in SSBs to snag a higher yield while we keep our eyes peeled for the next big stock swing.

Cash – The Straight‑Up Option

• Fast and Easy: No tax‑breaks or long‑term goals needed.
• Maximum Flexibility: You’re free to call back your money whenever the market lights up.
• Guaranteed Return: Even if the stock market’s on a rollercoaster, your SSBs will still hold their ground.

How to Get Started

1. Grab your handy‑cash.
2. Pop into any authorized SSB portal (can’t do it through the typical banks alone).
3. Choose the bond duration that sings to your short‑term or long‑term song and make the purchase.

Why Not Go SRS?

Don’t get us wrong: SRS is a solid choice for tax relief and a great long‑term plan. But for those who want straight higher interest without the extra fine print, cash wins.

Bottom Line

Build a cushion with the solid, higher‑yield SSBs. Keep the cash in your pocket, and let the market chairs yours for potential rollercoaster opportunities.

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Time to Talk About Singapore Savings Bonds (SSBs)

Did you know the headline rate you see is the compounded annualised return over ten years? That might sound fancy, but it’s basically the average rate you’ll get each year if you hold the bond for the full decade.

Want to see the exact amount you’ll receive each year? Just tap View Bond Details. That will break it down for you. And if you’re a bit curious about what the market is doing right now, check the current SSB rates on the MAS website – that’s the best spot for up‑to‑date numbers.

When the Window Opens

• The application for a new SSB starts on the first business day of the month.
• It closes on the fourth last business day of the month. So don’t wait until the last minute; mark your calendar!

First Things First – Set Up Your CDP Account

Before you drop your money into an SSB, you’ll need a CDP securities account with direct crediting services turned on. That’s the gatekeeper that lets the interest your bond earns slip straight into your account – just like a dividend cheque.

Buying the SSB

• Once you’ve got your CDP account, hop on over to the nearest ATM of any of the big three banks:
  • DBS / POSB
  • UOB
  • OCBC

  Pick the one that’s most convenient for you.

• Alternatively, you can go the digital route: sign in to your Internet Banking portal and order your SSBs online.

That’s the lowdown. Stick to the dates, set up that CDP, and you’re all set to ride those steady, decade‑long interest rates. Happy investing!

Steps for applying through ATM

Getting Started with Singapore Savings Bonds – A Quick and Easy Guide

Step 1: Log In Like a Pro

• Grab your card and password – it’s like the key to your financial adventure.
• Enter the credentials and hit that green button to jump right in.

Step 2: Dive into Investing

• Once you’re in, click on “Invest/Investment” – it’s the launchpad for your money dreams.

Step 3: Pick the Singapore Government Securities

• Navigate to “Singapore Government Securities” and let the excitement build.

Step 4: Choose Singapore Savings Bonds

• Scroll down and tap on “Singapore Savings Bonds.” These are the cozy, reliable bonds that keep your funds safe.

Step 5: Confirm Your CDP Account

• Make sure your CDP account is on the record – a quick double‑check keeps everything smooth.

Step 6: Enter Your Application Amount

• Type in how much you want to invest. Think of it as putting a little piece of your future into the market.
• Review everything one final time, then click “Submit.”

And just like that, you’re all set to let your money grow with Singapore Savings Bonds. Good luck, and enjoy watching your investment bloom!

Steps for applying through Internet banking

Cracking the Singapore Savings Bond Code in a Snap

Ever thought about sneaking a bite of Singapore’s government securities? Here’s the low‑down on grabbing your SSBs without tripping over the details.

Step‑by‑Step How to Store Your SSBs Online

Quick checklist – copy, paste, click.

• Kick off by logging in to your Internet banking account.
• Navigate to the Invest/Investment section.
• Choose Singapore Government Securities.
• Pick Singapore Savings Bond.
• Opt for the Cash payment method.
• Enter your CDP account details.
• Click Confirm and wait for the green light.

What Happens After You Send Off Your Request?

If everything goes smoothly, a quick confirmation email will arrive, telling you how many SSBs you’ve snagged. Tip: you can also give the online CDP portal a whirl or give their helpline at +65 6535-7511 a ring to double‑check your holdings.

Investment Basics – The Numbers You Need

Keep this in mind:

• Minimum purchase ₴500.
• Invest in ₴500 increments.
• Cap per person ₴200,000.

Because the supply is finite, each month only a set of bonds rolls out. Depending on how hot the market is right now, you may not get the full amount you asked for.

All set? Go ahead, get your bonds, and remember – the rules are simple, the process is simple, and the outcome? Smooth sailing through the Singapore investment wave.

How to redeem your SSBs

Ripping Into Your SSBs: How to Cash Out Without a Penalty

No Penalties—Just a Tiny Transaction Fee

Redemption of your Savings Security Bonds (SSBs) is as risk‑free as a Sunday stroll: no penalties for pulling them out early. The only hitch is a modest $2 transaction charge applied to every redemption request.

Where to Pull the Trigger

Think of the redemption process as a mirror of the original purchase. You can knock it off at your nearest ATM or breeze through Internet banking—just pick the spot that suits your style.

How Much Can You Grab?

• You can redeem in increments of $500, all the way up to the total amount you invested.
• The funds hit the bank account linked to your CDP the moment the request is processed.

Cash On The Horizon—Not Tonight

Heads up: you’ll only see the money in your account by the second business day of the next month. It’s a bit like waiting for a pizza delivery that arrives the night after you ordered—no rush, but definitely not instant.

Waiting Game: A Why & How

If you’re hoping to swipe the SSB cash right away to fund a stock purchase, you’ll find that hope dashed. The payout delay means first you’re stuck waiting, then you’re stuck waiting again before you can dive into the market.

During the early part of the month, this can feel like a Tetris puzzle: you’re looking for the right drop but the pieces keep folding. To dodge the frustration, I keep a stash of cash on hand for quick moves. As the month edges closer to its end, the timing tightens and the “cash‑in” wheel can spin faster.

Redemption Window: Counting the Days

The window for redeems opens on the first business day and closes on the fourth last business day of the month.

• So, if you want the cash in hand next month, plan your redemption during this span.
• After the deadline, you’ll have to wait until the next month’s window opens.

Quick Takeaway

Redim your SSBs early? No penalty, just a $2 fee. Pull from an ATM or online, hit 500‑dollar steps, and brace for the next month’s payday. Plan it right, keep a small cash buffer for the quick win, and you’ll keep the flow steady.

The fifth perspective

Why Singapore Savings Bonds Are Still a Smart Move—But Not the Cleanest Cash Cow

Short‑term, SSBs usually pay more than your regular bank savings, so they can be tempting. But remember: the rates are slightly lower now than in the past because Singapore’s economy is taking a hit from COVID‑19.

Listen up, Rate‑Checkers!

• Rates on SSBs fluctuate, so pick one that feels right for you.
• Don’t dump all your spare cash into the savings mosque—think of it like a financial smoothie.
• Buy in tranches; grab a chunk when the interest looks yummy.

Cash‑Ready in Turbulent Times

When the market is wobbly, kept‑a‑hand‑full of cash can help you swoop on sudden opportunities—wing like a financial ninja.

When the Shop is Calm, Fill Up

In a world where prices are high and chances slim, sliding more money into SSBs keeps it earning while you wait for something fresh.

Bottom Line

SSBs are cool without being “all‑or‑nothing.” Mix them into your portfolio while keeping a “cash‑reserve” game plan.

—Originally posted in The Fifth Person