Singapore Fixed Deposits

Launch of Panzer's Road Map to Financial Freedom

2009-06-05T19:32:00.000-07:00

Dear friends

I’ve completed writing my next book, Panzer’s Road Map to Financial Freedom and am pleased to pre-launch it here for a limited period (until end of June 2009 at the price of SGD 18.95!).

The concise 28 page book provides value that includes:

Simplifying your financial life by using Panzer’s 5 step approach to helping you achieve financial freedom
Saving you money
from using the value-packed Excel worksheet to manage your cash holdings
Clarifying your goal of achieving financial freedom
Motivating you towards being in control of your finances and your life

On top of the benefits listed above, I’ll be supporting those who invest in Panzer’s Road Map with Six months of email support in terms of questions, queries and tips on how you can develop your own unique strategies towards your own version of financial freedom.

The price of all these is only S$18.95 (less than two movie tickets)!

I guarantee that you will immediately save more than $18.95 if you practice at least one of the techniques in this book.

I look forward to seeing you be equipped with the tools to drive yourself towards your very own financial freedom by buying it now.

Be well and prosper.

Singapore Fixed Deposits has moved to its own domain

2008-03-23T22:58:00.000-07:00

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Singapore Fixed Deposits has MOVED!

2008-03-02T07:21:00.001-08:00

To be of better service to all of you who are interested to make your money work harder for you, Singapore Fixed Deposits has now moved to dedicated web hosting using Wordpress as the publishing tool.
Check out it out HERE.

HSBC 3 month and 12 month Fixed Deposit promotion

2008-03-02T01:40:00.001-08:00

Terms and Conditions

Treasury bills: Your alternative to fixed deposits in Singapore

2008-03-01T06:49:00.001-08:00

Today's wired society with internet access 24x7 sees everyone working at the speed of thought, as bits and bytes are transmitted virtually simultaneously through computer networks and systems.

How can we leverage on the available technology for our personal investments?

Let me share how we can buy and sell 3 month Singapore Government treasury bills issued by MAS using Poems. For those who have not heard of poems, it is Phillips Securities Online Electronic Mart system. Those who buy and sell stocks and shares in SGX online will know what is poems. The beauty of poems is that it is one of the more progressive electronic trading plaforms catering to retail investors and they have added the feature of being able to apply for the 3 month treasury bills issued every week by MAS.

Buying treasury bills using POEMS

The steps are simple:

1. Apply for a poems trading account - you can download the form online and sending it them them along with the required documents and deposit. You can also do it at any of their investor centres.

2. Apply for a cash management account online using the Online Forms option under > Stocks > Account Management

3. Once Phillips Securities has approved your (1) and (2) you are ready to participate in the 3 month treasury bills issuance market

Do note that poems does charge a bid-ask spread between what is offered by MAS on the cut-off yield vs the actual yield you receive. This is effectively the commission that Phillips earns from allowing you to do this electronically. Personally, I think this is worth the effort since it saves us time and effort and time IS money.

Take note that you should have sufficient funds when you are buying the treasury bills. Once purchased, you may sell the treasury bill anytime before maturity to Phillips of course at a slight discount. As treasury bills work as a zero coupon basis, this means if you deposit buy $1,000 worth of treasury bills, you will be deducted upfront for say, $990 and when the treasury bill matures, you will receive $1,000. Hence, your yield (or interest) is computed by this formula:

* Yield = 365 x (100-Price) / number of days.

Example. A 91 day treasury bill is priced 99.30. Hence yield = 365x(100-99.30)/91= 2.808%

Transferring money to and from poems is also quite easy. Once you have set up the poems account and also the EPS (electronic payment for shares) with Poems, you may:

1. Transfer money to Poems using internet banking or ATM via EPS feature

2. Transfer money from Poems using Online Forms to pay via direct credit (POSB/DBS) or via quick cheque to any local bank in Singapore

For those of us who wish to have more alternative lower risk investment instruments, treasury bills are a good complement to fixed deposits and savings and let your fingers help you do the investing!

Make your money work harder for you!

What can we do in this low interest rate environment in Singapore?

2008-02-18T16:45:00.000-08:00

Interest rates are low hovering around 1.5% or less for shorter tenures as can be seen here in my previous post on Singapore banks and fixed deposits interest rates for the last 2 years.

There is nothing much we can do...unless
In reality, for most savers, there is very little you can do if you are not willing to accept more risk for the possibility of greater returns. If you do not have the time, inclination and more importantly the interest to learn about other investments such as stocks and shares, property, unit trusts (mutual funds) etc, then it will be difficult to get a better return than what banks and finance companies can give you for a relatively risk free investment (especially your first $20,000 deposit that is covered under the deposit insurance scheme in Singapore).

If you are happy in your job, do not want to worry or take on the REAL POSSIBILITY of your investments going -20% (or +20%) or even -50% (or +50%) which CAN HAPPEN for stocks and shares, then you should just look at strategies to lock in higher interest rates and learn about treasury bills which can move higher than fixed deposits in terms of interest returns.

Other riskier strategies include foreign currency fixed deposits where you place a fixed deposit at much higher interest rates (e.g. 7-8% per annum for New Zealand Dollar) for 1-12 months (depending on your deposit amount and individual banks packages). The interest rate is high but so is the risk. The risk comes from the movements of the foreign currency against the Singapore dollar. To some extent, this risk can possibly be higher than stocks and shares because the variability of currency movements can be higher in a short space of time of weeks or months.

Remember the number 1 rule of investment (NOT TO LOSE MONEY)
For those of you who are just starting out in investments, you have time on your side and can consider reading and learning about investments beyond fixed deposits and treasury bills whilst leaving your money there FOR THE TIME BEING. But do equip yourself with the knowledge, skills and competence to learn about what is available to you as someone who wants to make your money work harder for you.

If you are totally new to investments, I'll recommend you reading "The Richest Man in Babylon" for fundamental principles on personal finance and slowly work your way up with books on equity investments "One Up on Wall Street" (Peter Lynch) and "The Intelligent Investor" (Benjamin Graham) - though this book is more heavy going.

Get yourself an education using the public libraries so that you can make your money work harder for you. :-)

New Fixed Deposits Promotion by Standard Chartered Bank

2008-02-17T16:35:00.000-08:00

Stanchart started this promotion 12 Feb 2008. The catch is that you have to lock in an equivalent amount in a 6 month FD on top of the 3 month FD promotion at 1.70%.

Please read the fine-print.

Fixed Deposits Interest Rate of Banks and Finance Companies in Singapore (Jan 2006 to Dec 2007)

2008-02-15T22:31:00.001-08:00

Analysis of Interest Rates from Jan 2006 to Dec 2007

In general, Finance Companies pay slightly higher interest rates on fixed deposits as compared to banks fixed deposits as seen in the chart above. Interest ratse are trending down and this is obvious for the interest rates of 12 month fixed deposits offered by finance companies. These hit a high of 2.09% in May 2006 and dipped into the lowest of 1.48 in April to May 2007.

These are the average of 10 leading banks and finance companies but give an indication of the fixed deposit market in Singapore.

[Source: http://www.mas.gov.sg - MAS Financial Statistics]

What can we learn from this?

In general, if you have some investible savings that you wish to put in fixed deposits, you would be able to squeeze out a few basis points or percent in interest if you generally chose finance companies as compared to banks. Of course, individual promotions by banks and finance companies vary so do SHOP AROUND for the best deals at a point in time.

Secondly, do note that this is for 1 year fixed deposits, so once you put the money in, you generally do not wish to touch it or you will either lose some of your accrued interest or be liable for some administrative fees levied by the banks or finance companies. Ask the bank or finance company for its early termination or uplift penalties or charges FIRST BEFORE you place your money with them to avoid liqudity issues.

Thirdly, once you place your 12 month fixed deposits, you lock in the interest for 12 months so even when the bank's new fixed deposit rates go lower, youare still locked in at the prevailing rate at the time of placement. Hence, in times when interest rates are going down, locking in fixed deposit rates is a good idea. However, when interest rates go up, then you may find yourself locked in a lower rate. Therefore, the trick is to spread out your fixed deposits in different tenures to spread the risk of interest rate fluctuations.

While the returns from fixed deposits at current rates will not overcome projected inflation at 4.5 to 5.5%, it is still prudent to have SOME part of your investible savings in such safe instruments to act as a ballast against your riskier portfolio.

Make your money work harder for you!

Market Reports on Singapore Interest Rates by Banks in Singapore

2008-02-13T17:36:00.001-08:00

You can read up what some of the local banks' research departments analysis on the Singapore Interest Rate market through their respective websites.

DBS does a Economic Alert [PDF document] titled "DBS Interest Rate Outlook & Strategy: Singapore" which analyses the short term movement in Singapore Dollar interest rates. Of course, it tells you what you already know, that rates are low and will tend to be low for the near-term.

UOB also has similar reports in their website here.

OCBC also does a SGS weekly [PDF document] that gives their views on fixed income strategies.

Empower yourself with more information and knowledge about the markets and you will be able to impress friends, acquaintances and colleagues as you dissect the movements of Singapore interest rates with the help of your friends above.

http://singapore-fixed-deposits.blogspot.com/

"Make your money work harder for you."

Monetary Authority of Singapore Financial Databases: Financial Statistics for the Fixed Depositor

2008-02-13T06:11:00.001-08:00

The MAS provides useful statistics for those who wish to see the historical trends of the following bits of information:

Exchange Rates
S$ Nominal Effective Exchange Rate Index (XLS, 48KB) (PDF, 20KB)
Domestic Interest Rates
Interest Rates for Banks and Finance Companies
Singapore Overnight Rate Average
US$/S$ Forward Swap Points (XLS, 43KB) (PDF, 23KB)
NPLs of Singapore Incorporated Banks
SGS Prices and Yields - Benchmark Issues
SGS Bond Prices and Yields - All Issues by Issue Code
SGS Treasury Bills Prices and Yields - All Issues by Issue Code
SGS Volume Turnover

For those of us who put money in treasury bills and fixed deposits, the few items listed in red above are worth taking a look at.

Information is available for those who seek it.

Singapore-fixed-deposits.blogspot.com helping to make YOUR money WORK harder for YOU.

Finatiq Fixed Deposits

2008-02-08T04:47:00.001-08:00

W.e.f 16 January 2008

1 Month - 1.40% per annum

3 Month - 1.60% per annum

6 Month - 1.80% per annum

Minimum placement : S$3,000

Early withdrawal service fees apply.

RHB Bank Trio Account Rates Down

2008-02-07T19:37:00.001-08:00

New rates:

Old rates:

Surviving Low Domestic Interbank Rates in Singapore

2008-02-04T18:04:00.000-08:00

I have written a post here in the Five Cents Ten Cents blog.

Enjoy.

OCBC Monthly Savings Plan

2008-02-03T19:15:00.001-08:00

Current Rates:Previous Rates:

HLF Singapore Time Deposit Rates: Golden 55 Plus

2008-02-03T19:02:00.000-08:00

New rates:

Old Rates:

HLF Time Deposits - Silver 40

2008-02-03T18:58:00.000-08:00

Silver 40 Plus

New rates:

Old Rates

HLF Time Deposit Rates

2008-02-03T18:55:00.000-08:00

Festive FD

New rates:

Old rates:

Maybank iSavvy Savings Account Rates

2008-01-30T19:02:00.000-08:00

Maybank iSavvy will be cutting its rates down from 4 Feb 2008 in line with downward pressure on interest rates in Singapore.

Balances of $5,000 to below $50,000 will now attract 1.08% (previous: 1.68%).
Balances of $50,000 and above will now attract 1.28% (previous: 1.98%).

OCBC Time Deposit Interest Rates

2008-01-30T17:36:00.000-08:00

New Rates (30/01/2008):

Old Rates:

Sing Investments & Finance Limited Fixed Deposit Rates

2008-01-29T23:27:00.001-08:00

Maybank iSavvy Time Deposits - Better than most but also going down due to low interest rate environment

2008-01-24T23:55:00.000-08:00

Maybank's iSavvy Time Deposit Rates are also declining somewhat with the low interest rate regime.

Old rates: good for those who have at least $25,000 in investible savings and who are internet savvy.

ABN Amro Festive Welcome Package

2008-01-24T01:42:00.000-08:00

3 months time deposit, minimum deposit of $50,000k. If you want to get the cash ang pow, you will need a minimum of $100,000 deposit. Van Gogh customers only (min $200,000).

This promotion is on until 15 Feb 2008. Millennium current account must also be opened, maintaining $20,000 for 6 months. If you only maintain $5,000, the time deposit interest rates will only be 1.45%.

Mosmos commented that it was somewhat confusing. I concur. :-P

HSBC Multi-currency savings account interest rates has dropped

2008-01-22T18:44:00.001-08:00

HSBC Multi-currency savings account interest rates are moving:

Current rates (19 Feb 2008):

Previous rates:

Previous rates:

Previous rates:

Previous rates:

Previous rates:

Previous Rates:

Previous Rates:

Previous Rates:

Fixed deposits: The practical way to learn the first rule of investing: Don't lose money!

2008-01-22T17:55:00.000-08:00

Investing in fixed deposits will not get you rich at current interest rates. But it goes a long way for you to implement the fundamental rule of investing:

DON'T LOSE MONEY!

Growing your investible savings from investing

In my other blog "Five Cents Ten Cents" on financial freedom, I talk about living within your means, saving and investing and leveraging on the power of time and compound interest to grow your investible savings towards financial freedom. As the recent bear markets around the world's stock markets (including the Singapore Exchange) have proven, if you put 100% of your investible savings in just one asset class such as equities (stocks and shares), you are at risk to the market turbulence that hits equity markets periodically as bulls and bears take turns to rule on the stage.

One of the easiest way to diversify the risk of investing in just one asset class is to have some portion of your investment portfolio in a relatively low risk asset such as fixed deposits. While the recent interest rates for fixed deposits hover around 1.5% to 2%, this still beats the double-digit negative returns from investing in the stock market.

Points to consider before investing in fixed deposits

Investing in fixed deposits is relatively straightforward. You generally need to have the minimum amounts of $5,000 or $10,000 (or lower depending on the bank) and basically place this with a bank for a period of a few months to one to two years. The thing to consider about fixed deposits is liquidity vs interest rates. In general, the larger your principal amounts placed, the higher the interest rates. The longer the period of your fixed deposit, the higher the interest rate. This is because the banks would like to have you place your money with them for a longer period so that their processing costs are lower and also prefer to accept bigger principal amounts.

Here are some considerations before you place your fixed deposit with the bank of your choice:

1) Determine your principal amount to place
This should be derived after considering your cash flow needs. For instance, if you are expected to pay for a big ticket purchase e.g. LCD TV next month and would need the cash, it wouldn't make sense to put all your cash into fixed deposits for 1 year unless you have spare cash to make that payment.

2) Determine the tenure and interest rate
The interest rate offered as well as the tenure (i.e. length of time for the fixed deposit) should consider also your cash flow needs. Typically a longer tenure attracts a higher interest rate but some banks charge a penalty of loss of interest or additional fees if you do an early uplift of fixed deposit. Hence, you need to go for longer tenures if you have other sources of cashflows coming in and are reasonably confident that you won't need the cash set aside for the 1 year or 6 month fixed deposit.

The tenure is also dependent on whether you think interest rates are going UP or DOWN. If you hold the view that interest rates will go UP, then you may want to place fixed deposits for shorter tenures, say 3 months, and then renew at the higher rate either with the same or different bank. If you hold the view that interest rates are going DOWN, then you may want to "lock-in" the interest for 1 year. In reality, no-one can predict with any degree of certainty interest rate movements so your guess is as good as mine. There is no right/wrong answer.

3) Determine the bank
Different banks offer different freebies or services to customers. Nowadays, internet banking allows some banks to offer fixed deposit placement using internet banking without having to go down to a branch. This is largely a personal choice. However, from experience, local banks i.e. DBS, UOB, OCBC tend to offer lower fixed deposit rates compared to say Maybank, Bank of India etc. So if you want to look for slightly higher interest on fixed deposits, you may want to consider the foreign banks. Do note that all banks that can accept fixed deposits are licenced by the Monetary Authority of Singapore and are subject to the Deposit Insurance Scheme, hence they are safe from the eyes of the authorities. Some people still have the perception that foreign banks are not safe and prefer to bank with the local big boys. Decide for yourself and place your fixed deposits accordingly.

Have fun shopping for the best fixed deposit rate deals in town.

Singapore-fixed-deposits.blogspot.com ==>helping you make your money work harder for you!

Maybank: One of the best Savings Accounts rates in Singapore!

2008-01-21T23:33:00.000-08:00

Maybank offers one of the more competitive savings rates for its internet banking account iSavvy. It's 1.68% for balances exceeding $5,000 and 1.98% for balances exceeding $50,000 are hard to beat. If you are internet-savvy and do most of your banking transactions online, this account may be for you!

Citibank maxisweep account interest dropped

2008-01-21T23:15:00.001-08:00

Maxisweep current rates:

Maxisweep previous rates:

What is a fixed deposit?

2008-01-21T01:57:00.000-08:00

A fixed deposit (or time deposit) as defined by Investopedia is:

"A savings account or CD held for a fixed-term with the understanding that the depositor can only withdraw by giving written notice." (CD = certificate of deposit).

In simple terms, a fixed deposit is the money you put with the bank for a fixed term. Typical length of deposit can be as short as 1 day and as long as a couple of years but tenures (length of term) ranging between 1 month to 24 months are common in Singapore's domestic fixed deposit market.

People put money in fixed deposits because it is one of the simplest investments that you can start getting into for unsophisticated investors. In addition, under the new Deposit Insurance Scheme launched by the Monetary Authority of Singapore in 1 April 2006, the deposit insurance scheme will compensate individuals and charities for the first $20,000 of their Singapore dollar deposits in standard savings, current and fixed deposit accounts, net of liabilities, in the event that their bank or finance company fails. Hence, your first $20k is very safe as it is protected under this scheme.

The downside of fixed deposits is that current rates of between 1.5% to 2% mean that your fixed deposits while earning interest, cannot beat inflation projected at 5-6% for 2008. Hence, your real returns (net of inflation) is actually negative. However, other than treasury bills, the unsophisticated investor will find it difficult to find similar riskless investments.

Singapore Fixed Deposits is born!

2008-01-20T22:37:00.000-08:00

After writing about personal finance and financial freedom since early 2007, I've come to realise that there is a need for a blog that focuses on fixed deposits and treasury bills. Since fixed deposits are the first investment asset class that most investors start with, let's go back to basics and create a blog that focusses in this area.

We try to bring you the latest available information as given by the various banks but we are not a licenced investment advisor nor do we in any way encourage, induce or recommend any of these financial institutions for investments.

We disclaim ALL LIABILITY from users of this blog in acting on the information found in this blog and make NO WARRANTIES, REPRESENTATIONS ABOUT THE COMPLETENESS AND ACCURACY OF INFORMATION FOUND IN THIS BLOG. USE THE INFORMATION FOUND HERE AT YOUR OWN RISK.

INVEST IN YOUR OWN RISK!

Enjoy.

P.S. Shouts of thanks goes to mosmos who is contributing updates to where you can find the best deals to make your money work harder for you!