What can you invest with 500 Dollars?

invest with 500 Dollars

What can you invest with 500 dollars? For working adults like us, it is not a feat to folk out a minimum of 5K for a fixed deposit placement. If you have a higher risk appetite, you can invest 5K into stocks or bonds.

What about those that just started out working? Their starting monthly salary is usually lower than 5K. In my opinion, setting aside the minimum amount of S$500 is a good way to get started to grow your savings. If you will like to grow your S$500, below are some of the options that I found.

ICBC Fixed Deposit

Needless to explain, fixed deposits are simple to understand. You lock in your cash with the bank for a fixed time period such as 1, 3, 6, 12 months. Upon maturity, you get back your money with the interests earned.

ICBC is one bank or perhaps the only bank that I found that let you do a fixed deposit placement with only a minimum of S$500.

ICBC Fixed Deposit Interest Rates 25 Nov 2020

Based on the above rates, if you decided to do a 12 months fixed deposit placement of S$500 via E-Banking, the interests you will receive upon maturity is S$3.75.

Singapore Savings Bonds

The next option to consider is the Singapore Savings Bonds. The minimum amount is S$500 but you have to pay an administrative fee of S$2 every time you make a purchase of the Singapore Savings Bonds.

The latest issue of the Singapore Savings Bonds (GX20120T) offers you an effective return of 0.24% p.a. if you held it for 1 year. That is a return of S$1.20.

Not too bad already, S$1.20 can buy you a cup of Kopi at the coffee shops.

GIGANTIC or Singlife Account

GIGANTIQ is a single premium, yearly renewable, non-participating universal life plan by Etiqa that gives you a guaranteed return of 2.0% per annum on your first S$10,000 for the first year. Any amount above S$10,000 earns you 1.0% per annum for the first year. The minimum amount to get started is S$50. For S$500 deposited with GIGANTIC for 1 year, the return you will receive is S$10.

Similarly, Singlife is a capital guaranteed insurance savings plan that gives up to 2% p.a. returns. The minimum amount to get started is S$500. For S$500 deposited with Singlife for 1 year, the return you will receive is S$10.

Syfe

If you have a higher risk appetite, you can choose to explore Syfe.

Syfe is a digital wealth manager licensed by the Monetary Authority of Singapore (“MAS”) under a Capital Markets Services (“CMS”) License.

There is no minimum amount to start investing in any of their portfolios.

Syfe Portfolio Types

I hope the above provide enough options for those that can only set aside S$500 but do not know where to get started.

“If you don’t find a way to make money while you sleep, you will work until you die. – Warren Buffet”

China Taiping i-Save Plan 10th Tranche

China Taiping i-Save 1.96 per annum

China Taiping i-Save Plan 10th Tranche offers you a guaranteed return of 1.96% per annum for 3 years. The previous tranche in April 2020 which offers you 2.18% p.a. was fully subscribed within a month. With falling interest rates across other financial products such as Singapore Saving Bonds, fixed deposits and saving accounts, I can see why Singaporeans are snatching these limited tranche endowment plans quickly.

What are Endowment Plans?

Endowment plans such as China Taiping i-Save are life insurance saving plans that are 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.

In this case, China Taiping i-Save Plan is a single premium, non-participating life insurance savings plan offered by China Taiping Insurance (Singapore) Pte Ltd that gives you a lump sum payout with guaranteed return of 1.96% per annum over 3 years.

The maximum investment amount is S$100,000 which gives you a return of S$6,000 at the end of policy maturity.

My Opinion

In my opinion, this is a low risk investment as compared to stocks and bonds. If your heart cannot take it or you cannot sleep because the stock market has crashed due to COVID-19, China Taiping i-Save Plan is something that you can look at for a short term investment.

Last month, I have shared about NTUC Gro Capital Ease which similarly offers 1.96% p.a. over 3 years but it has been fully subscribed. Thus you may wish to consider this.

Disclaimer: This is not a sponsored post and solely the author’s opinion.