CIMB Fixed Deposit Promotion Makes Your Money Work, Not You!

I like the way CIMB says “Your money should work, not you!“. Following my previous post on “Fifty Six Percent Invested Forty Four Percent Cash“, I do have some spare cash to place into a fixed deposit or Singapore Savings Bonds. Both are brainless, effortless investments where you sit and wait till maturity to earn the interests.

If you remember, CIMB offers a fixed deposit promotion during Chinese New Year whereby you can get up to 1.90% interest per annum if you do a placement for 12 months online. It seems that this promotion is here to stay as they are offering the same promotion in the month of March.

You can choose the duration of 3 months, 6 months or 12 months and if you apply online, they offer higher interest rates as shown in the table below.

Interest Rates (% p.a.)
3 Months 6 Months 12 Months
Branch Rate 1.30 1.45 1.55
Online Exclusive Rates 1.55 1.70 1.90

A minimum of S$10,000 per placement is required.

Using S$10,000 as an illustration,

If you place a fixed deposit for 3 months, the total accrued amount (principal + interest) that you will receive is

A = 10000(1 + (0.0155 × 0.25)) = 10038.75
A = $10,038.75

If you place a fixed deposit for 6 months, the total accrued amount (principal + interest) that you will receive is

A = 10000(1 + (0.0170 × 0.5)) = 10085
A = $10,085.00

If you place a fixed deposit for 12 months, the total accrued amount (principal + interest) that you will receive is

A = 10000(1 + (0.0190 × 1)) = 10190
A = $10,190.00

CIMB Fixed Deposit Promotion Versus Singapore Savings Bonds

How does this promotion fair against the latest Singapore Savings Bonds?

If we have placed S$10,000 in the April 2019 Singapore Savings Bonds, we will receive S$196 in interest payout after a year. This will be S$6 more than CIMB 12 months fixed deposit promotion. If we deduct away the S$2 application fee for Singapore Savings Bonds application, then it will be S$4 more.

My Opinion

Both are comparable, risk free investments. If you ask me, I might prefer the Singapore Savings Bonds as there is no lock in period. You can sell off the bonds and there is no penalty should you need the money urgently within the 12 months.

My favorite website, StocksCafe has introduced a new feature to allow adding of Singapore Savings Bonds into your portfolio. If you didn’t know, I signed up as a Friend of StocksCafe as my most favorite feature of StocksCafe is the automated tracking of dividends payout.

Fifty Six Percent Invested Forty Four Percent Cash

The last time I checked my cash level was in November 2018 where I have only 31% cash on hand and 69% was invested in stocks. If you didn’t know, I considered monies in my DBS Multiplier Savings Account, Singapore Savings Bonds (SSB) and cash benefits payouts from NTUC Revosave as “Cash”. These are monies that I can easily redeem in event of an investment opportunity or in terms of emergency such as a job retrenchment etc.

“Investments” are stocks and REITs that I have bought. If you wonder why I am plotting the above pie chart to track my cash versus my total investments, the reason is meant to ensure that I do not over invest in the stock market. Personally, I felt that the stock market is very unpredictable and you may never know when is the next stock market crisis. Having a healthy cash on hand allows investors to tide over the crisis and not having to sell their stocks that most likely will suffer losses during a stock market crisis.

As of 16th March 2019, I have 44% cash on hand and 56% in investments which I consider as a healthy level. I will continue to build up my cash and deploy them when the investment opportunity arises. Currently, I observed that most prices of stocks and REITs have gone up significantly and thus their dividend yield have also declined.

Over the next few months, I shall continue to build up my cash on hand.

My Sweet Retirement Switches to Open Electricity Retailer

I am glad that the area that I am staying in is finally eligible to switch over to the open electricity market where I can choose my electricity retailer. There are currently two standard price plans which are the Fixed Price Plan and Discount Off the Regulated Tariff Plan. For the Fixed Price Plan, you pay a fixed rate throughout the contract period of either 6, 12 or 24 months. For the Discount Off the Regulated Tariff Plan, the rate you pay will change as the regulated tariff is adjusted every three months (quarterly). You get a fixed discount off the regulated tariff whether it goes up or down.

I preferred the fixed price plan for a more predictable electricity bill moving forward. Not trusting other websites that tells you which retailer offers the cheapest electricity per KWh, I did my own research. I visited the retailer’s website and compiled the information below. As you can see, iSwitch offers the cheapest electricity per kWh but there is a service charge of $5.297 per month. This means you end up paying $63.56 per year for services charges!

The rates offered by Geneco, Keppel Electric and Sembcorp are similar at 17.78 cents per kWh w/GST for a two year contract. If you didn’t know, Geneco partners with Singtel while Keppel Electric partners with M1. The telcos do offer some perks if you sign up with their partners and you may wish to check out the Telco’s website for more information.

For me, I have chosen to sign up with Sembcorp as my home internet is with Starhub. I have gotten $20 NTUC vouchers by signing up at their roadshow.

Have you switched?

Retailer per kWh w/ GST

(24 Months)

Monthly Service Charges
Geneco 17.78 cents No
Keppel Electric 17.78 cents No
iSwitch 17.55 cents Yes
Sunseap 17.98 cents No
Best Electricity Supply 18.90 cents No
OHM 18.95 cents No
Sembcorp 17.78 cents No