May 2020 Singapore Savings Bonds GX20050A is 1.39%

The effective interest rate for May 2020 Singapore Savings Bonds (GX20050A) is 1.39% if you held it for 10 years. Due to the COVID-19 situation, this is the lowest interest rate that was offered by Singapore Savings Bonds since inception. The minimum amount you can purchase for Singapore Savings Bonds is S$500. If you decide to hold and sell it for 1 year, the effective interest rate is 0.96% which is worst than what fixed deposits can offer. But of course most fixed deposit requires a minimum sum of at least 10K. If you are unable to fork out 10K at the moment, Singapore Savings Bonds is still a good place to dump your money to earn interests.

Last month, NTUC Income has released their single premium savings plan (“NTUC Capital Plus“) with a guaranteed return of 2.13% per annum over 3 years. There is a minimum sum requirement of 5K. I have purchased it using my Supplementary Retirement Scheme fund.

On 1st January 2020, DBS Bank has notified that the dividends from CDP will no longer qualify under the investment category for DBS Multiplier Account. This means that the reason for purchasing Singapore Savings Bonds for the purpose of additional interest for DBS Multiplier Account is no longer valid.

Tracking Singapore Savings Bonds via Stocks Café

My favorite website, Stocks Café has introduced a new feature to allow 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)

NTUC Capital Plus Versus Singapore Savings Bonds

NTUC Capital Plus is a single premium savings plan that gives you a lump sum payout with guaranteed return of 2.13% per annum over 3 years. Instead of the minimum sum of S$20,000 that was offered in the previous tranche, the minimum amount for the current NTUC Capital Plus is only S$5,000 which you can pay using cash or using your Supplementary Retirement Scheme (SRS) fund.

I personally think it is a good choice to use your Supplementary Retirement Scheme (SRS) funds to purchase Capital Plus for a higher guaranteed yield since SRS can only be withdrawn after your retirement age.

Using the calculator that is offered at NTUC income’s website, I opt for the minimal investment amount of S$5,000.

NTUC Capital Plus Versus Singapore Savings Bonds

How does this fare against the Singapore Savings Bonds? The current issue of Singapore Savings Bonds (SBAPR20 GX20040X) offers an average interest rate of 1.63% over 10 years.

Even NTUC Capital Plus is a clear winner here with an interest payout of S$326.35 at the 3rd year, let us check how much interest will you receive if you redeem the Singapore Savings Bonds early at the 3rd year.

Based on the table below, it seems that the interest rate for April 2020 issue of Singapore Savings Bond is consistent at 1.46% for the first 3 years. You receive S$73 per year.

The total interest you will receive is S$73 per year x 3 years = S$219 if you held Singapore Savings Bonds (SBAPR20 GX20040X) and redeem it at the 3rd year.

April 2020 Singapore Savings Bonds is 1.63%

The effective interest rate for April 2020 Singapore Savings Bonds (GX20040X) is 1.63% if you held it for 10 years. This is the lowest interest rate that was offered by Singapore Savings Bonds since inception. The minimum amount you can purchase for Singapore Savings Bonds is S$500. If you decide to hold and sell it for 1 year, the effective interest rate is 1.46% which is worst than what fixed deposits can offer. I shall share with you in my upcoming post which fixed deposit promotion that I found that offers better interest rate than Singapore Savings Bonds. But of course most fixed deposit requires a minimum sum of at least 10K. If you are unable to fork out 10K at the moment, Singapore Savings Bonds is still a good place to dump your money to earn interests.

On 1st January 2020, DBS Bank has notified that the dividends from CDP will no longer qualify under the investment category for DBS Multiplier Account. This means that the reason for purchasing Singapore Savings Bonds for the purpose of additional interest for DBS Multiplier Account is no longer valid.

Tracking Singapore Savings Bonds via Stocks Café

My favorite website, Stocks Café has introduced a new feature to allow 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)