The effective interest rate for September 2020 Singapore Savings Bonds (SBOCT20 GX20100N) is 0.90% if you held it for 10 years. The interest rate has recovered slightly as compared to 0.88% in August. The COVID-19 pandemic that started in March 2020 had caused the interest rates to fall dramatically across fixed deposits and savings accounts.
The minimum amount you can purchase is S$500. If you decide to hold and sell the current issue (SBOCT20 GX20100N) after 1 year, the effective interest rate is 0.26%.
Singapore Savings Bonds Alternatives
I wouldn’t put my money into the Singapore Savings Bonds as the interest rate is simply too low. Fortunately, there are alternative financial instruments out there that offer higher interest rates. They are short term endowment plans such as NTUC Income Gro Capital Ease, Tiq 3 Year Endowment Plan and China Taiping i-Save. You can read more about them in Best Endowment Plans In August 2020.
If the lock in period for Endowment Plans is a concern for you, you can check out Dash EasyEarn or the Singlife Account.
In July, I have signed up for Dash EasyEarn that offers you an attractive interest rate of 2% p.a. for the first year and 1.5% p.a. for subsequent years. Similar to Singlife Account, there is no lock in period, no monthly fees and you can withdraw your money anytime. Signing up takes less than 10 minutes!
Tracking Singapore Savings Bonds via Stocks Café
My favorite 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 favorite 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)