The SSB issue for May 2018 offers a 1.65% interest for the first year! Stretching up to 3.00% for the 10th year. Aside this, the SSB monthly issurance size has also increased from the usual 150 million to 200 million due to increasing demand for SSB!
|Image taken from SSB's site - www.sgs.gov.sg|
As usual, I've been looking around for a good place to park some funds for a short term. Today's release of SSB for May 2018 has come to me as a surprise.
The rates we see here today is even better than rates offered by fixed deposits from banks that I know off (in SGD for 12 months)!
I've mentioned earlier in a post back in January about the shiny part I like for the SSB issued in Feb 2018:
1. The flexibility in your funds
2. A risk-free place for you to park your money with no capital loss
3. A relatively lower amount required compared to FDs.
If the rates offered by SSB is lower than what we can get from fixed deposits, why SSB then?
As a consumer, I must find product that caters well to my needs/wants.
I do not want my funds to be rotting and the interest here from fixed deposit or SSB today will save me a little on the opportunity cost.
I want the funds here to be easily liquidated. SSB can be liquidated at any given month before the bond matures with no penalty. Interest is pro-rated too (more information here). On a side note, the only charges will be $2 for redemption and $2 for application.
I want some assurance on these funds too so I can sleep in peace knowing that my opportunity funds will not lose its value or evaporate. This will allow me to better make use of bargains in the future.
Too good to be true? But never buy blindly!
One must bear in mind that it may seem really attractive for a risk-free bond to generate 1.65% on a short term of 1 year, only proceed on when this fund here is a spare fund to you and that you can last for at least a month while waiting for proceeds from redemption.
Do note that for redemption of SSB, it will require a little bit of time as well.
Redemption of SSB will be closed on the last 4th business day of the month and proceeds will only be paid on the 2nd business day of the following month.
For more information on redemption, please check on from SSB's official website here.
Interest Rates for May 2018's SSB (for GX18050E):
Here are some important dates for this bond for anyone who's interested to consider:
Issue Date: 1 May 2018
Maturity Date: 1 May 2028
Interest Payment: 1st interest payment date on 1 Nov 2018 and subsequently every 6 months on 1 May and 1 Nov every year.
Opens: 6:00 pm, 2 Apr 2018
Closes: 9:00pm, 25 Apr 2018
Results: After 3:00pm, 26 Apr 2018
For more information, please visit SSB's website on the latest bonds here.
I will be applying for some SSB in May 2018's edition to park my funds.
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Singapore Saving Bonds (SSB) - 1.55% (Feb 2018)