Singapore Savings Bond versus Savings Account versus Fixed Deposits

The latest Singapore Savings Bond (“SBSep17“) is offering 2.12% effective interest rate over a ten years period. Many people have been lamenting about the low interest rates and I also think the Singapore Savings Bond interest rate is not attractive. I decided to do some research by comparing it with similar low risk products out such as a popular high yield Savings account and Fixed Deposit account. I am excluding REITs and Stocks in the comparison as the intention is to park the money somewhere as a form of war chest or savings.

I picked CIMB StarSaver Account, CIMB 12 month fixed deposit and MayBank 12 month fixed deposit.

CIMB StarSaver Account offers 0.8% interest per annum.

A 12 month fixed deposit account with CIMB offers 1.18% interest per annum. Do note that the minimum amount for fixed deposit is 20K.

MayBank on the other hand offers 1.4% interest per annum. Do note that the minimum amount for fixed deposit is 50K.

Below is the comparison I have tabulated.

If I held 10 thousand dollars up till the year 2027

  • The total interest received for CIMB StarSaver Account is $829.42.
  • The total interest received for Singapore Savings Bond is $2,167.
  • The total interest received for CIMB 12 month fixed deposit is $1,244.67 assuming I renew the fixed deposit at same interest rate over the ten years period.
  • The total interest received for MayBank 12 month fixed deposit is $1,491.57 assuming I renew the fixed deposit at same interest rate over the ten years period.

It seems that the clear choice is Singapore Savings Bond as compared to letting your money sit in your savings account.

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