SBAUG24 GX24080W is 3.22%

Singapore Savings Bonds SBAUG24 GX24080W

The effective interest rate for Singapore Savings Bond (SSB) August 2024 (SBAUG24 GX24080W) is 3.22% if you held it for 10 years. As you can see from the graph above, the interest rate continued to decline over the past 2 months. The interest rate for SBAUG24 was 0.08% lower as compared to SBJUL24.

Singapore Savings Bonds (SSB) were introduced in 2015 as a type of Singapore Government Securities. Singapore Savings Bonds (SSB) were designed for individual investors who want to participate in the Singapore Government Securities (SGS) market but in smaller denominations. You can buy Singapore Savings Bonds for a minimum of S$500.

Unlike ordinary 10-year bonds, you can redeem Singapore Savings Bonds (SSB) in any month for the face value of the bond plus accrued interest. This eliminates interest-rate risk. There are no penalties for early redemption except for the S$2 transaction fee.

As I get older, I would consider opting for less risky investments because there is very little leeway for me to earn back the capital if I make any mistakes in our investments. With almost zero risk, buying Singapore Savings Bonds is a great way to build up my monthly passive income to help in early retirement.

I am in my mid-forties and Singapore Savings Bonds make up 20.11% in terms of value in my stock portfolio. A balanced portfolio typically consists of a mix of stocks and bonds. Stocks offer growth potential, while bonds provide stability.

Singapore Savings Bonds Interest Calculator

Are you wondering how much interest you would earn if you held Singapore Savings Bonds (SBAUG24 GX24080W) for 10 years? To make it easy for you, Monetary Authority of Singapore (MAS) had come up with a Savings Bonds interest calculator.

singapore savings bond august 2024

Let us use an investment of S$10,000 as an example. If you purchase SBAUG24 GX24080W and held it for 10 years, you will receive a total earning of S$3,224. Based on the chart generated from the Savings Bonds Interest Calculator, you will receive an estimate of S$319 per year until maturity in August 2034 depending on the interest rate for that year.

Below is the interest per year for Singapore Savings Bond August 2024.

Year from issue date Interest % Average return per year %*
1 3.19 3.19
2 3.19 3.19
3 3.19 3.19
4 3.19 3.19
5 3.19 3.19
6 3.19 3.19
7 3.20 3.19
8 3.28 3.20
9 3.31 3.21
10 3.31 3.22

*At the end of each year, on a compounded basis.

What are Singapore Savings Bonds?

Singapore Savings Bonds (SSB) are issued and fully backed by the Singapore Government. The bonds are among the few with AAA credit rating which means they are by default low risk. With the Singapore Government backing, this means there is virtually no risk of capital loss. The bonds take their interest rates from the average yields of Singapore government bonds from the month before.

If you would like to know how the effective interest rate for this month’s issue of Singapore Savings Bonds is computed, you can refer to my previous post on Predict Singapore Savings Bonds Interest Rate.

When to Choose Singapore Savings Bonds (SSB)?

The returns for Singapore Savings Bonds may not be as attractive as compared to other investments such as Fixed Deposits or Treasury Bills. However, Singapore Savings Bonds is attractive in its own areas.

The minimum amount to invest in Singapore Savings Bonds is low at S$500. This is unlike other investments such as Singapore Treasury Bills (T-Bills) where the minimum is at least S$1,000. For Fixed Deposits, the minimum is usually set at S$10,000.

The high liquidity is one of the features that I like about Singapore Savings Bonds. There is no lock in period which means you can sell it anytime.

Since Singapore Savings Bonds is near to zero risks, it can also be treated as an emergency funds to complement your savings.

How To Track Singapore Savings Bonds?

StocksCafe Tracking of SSBI use Stocks Café to track my Singapore Savings Bonds purchases. If you like to know more about Stocks Cafe, please read up my previous review of Stocks Cafe.

How to Build a Singapore Savings Bonds (SSB) Ladder?

A Singapore Savings Bonds ladder is a strategy that involves creating a portfolio of bonds with staggered maturities. The goal is to earn a passive income while reducing exposure to interest rate fluctuations.

Singapore Savings Bonds (SSB) pay semi-annual interest, and building a bond ladder allows you to receive monthly coupon payments. Each issuance of SSBs matures at different future dates. Thus, you will need to continue purchasing every issue of Singapore Savings Bonds (SSB) until you receive coupon payments every month.

I am building up my passive income for retirement. Have you started?

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