GREAT SP Series 5A

GREAT SP Series 5A

GREAT SP Series 5A is a short term Endowment plan that provide guaranteed returns of 1.2% p.a. at the end of 2 years. The single premium insurance plan is offered via a partnership between OCBC bank and Great Eastern for a limited period only.

You can pay the one time premium for GREAT SP Series 5A using cash or your Supplementary Retirement Scheme (SRS) funds. Minimum starts at S$10,000.

The plan allows you to choose between choosing a one-time payout or yearly payouts.

GREAT SP Series 5A One Time Payout Option

What are Endowment Plans?

Endowment plans are life insurance saving plans offered by insurance companies.

The aim is to help policyholders save towards specific financial goals. Policy holders can contribute a regular amount for a designated period of time or pay a lump sum upfront at the start of the policy.

Upon maturity of the policy, you will be given a lump sum payout with the guaranteed return. It is best to study the plan carefully as certain endowment plans offers non-guaranteed returns.

Summary of GREAT SP Series 5A

Below is a summary of the Pros and Cons of GREAT SP Series 5A endowment plan.

Pros

  • Short 2-year commitment.
  • 100% capital guaranteed after 2 years.
  • Interest rates is higher at 1.2% p.a.
  • Pay using cash or Supplementary Retirement Scheme (SRS) funds.
  • Comes with insurance coverage for death and total and permanent disability.

Cons

  • Minimum starts at S$10,000. Personally, I felt that this is slightly high.

Disclaimer: This is Not a sponsored post and the opinions are solely based on My Sweet Retirement’s opinion.

SBFEB22 GX22020W is 1.64%

Singapore Savings Bonds SBFEB22 GX22020W

The effective interest rate for February 2022 Singapore Savings Bonds (SBFEB22 GX22020W) is 1.64% if you held it for 10 years. The minimum amount you can purchase is S$500. If you decide to hold and sell the current issue (SBFEB22 GX22020W) after 1 year, the effective interest rate is 0.52%.

As you can see from the chart above, the interest rate is declined slightly as compared to SBJAN22. Despite the low interest rate, Singapore Savings Bonds complement your other savings and investments as a safe way to save for the long term. It is basically near to zero risks.

Singapore Savings Bonds Alternatives

For low risk and higher returns, you can consider Dash EasyEarn or Dash PET.

When Dash EasyEarn was launched, it offered 2.00% p.a. for the first year. Recently, it has announced the reduction of its return from 2.00% p.a. to 1.20% p.a.. This will be effective from 30th July 2021 onwards.

Similarly, Dash PET had reduced its rate of return from 1.70% p.a. to 1.3% p.a. for the first S$10,000.

Both plans still beat Singapore Savings Bonds 1 year return of 0.52% p.a.

Higher Returns But Higher Risk

If you are a risk taker, you can try purchasing Crypto and depositing with Hodlnaut to earn higher interest.

Cryto is definitely not for the faint hearted. If you are looking for safe haven, stick to Singapore Savings Bonds.

Is Singapore Savings Bonds still Useful?

Most of the financial products out there require you to invest using cold hard cash. This is where the Singapore Savings Bonds outshine them. You can purchase the Singapore Savings Bonds using your Supplementary Retirement Scheme (SRS) funds.

The interest rate for Supplementary Retirement Scheme (SRS) fund is only 0.05% per annum. You can top up your SRS account to offset your annual taxes and then use the funds from your SRS account to purchase Singapore Savings Bonds to earn a higher interest rate.

Tracking Singapore Savings Bonds via Stocks Café

My favourite website, Stocks Café has allows adding of Singapore Savings Bonds into your portfolio. If you didn’t know, I signed up as a Friend of Stocks Café as my most favourite feature of Stocks Café is the automated tracking of dividends payout.

This is the third year that I continue to use Stocks Café to track my dividends.

Tracking Singapore Savings Bonds via My Savings Bonds Portal

MAS has launched My Savings Bonds Portal where you can track your Singapore Savings Bonds purchases separately from your stock purchases. I have done up a simple guide here. (Read more: Guide to My Savings Bonds Portal)