First Singapore Savings Bond

The first Singa­pore bond was opened for applic­a­tion on 1st Septem­ber 2015 and will close on 25 Septem­ber 2015, 9pm. The total amount for this alloc­a­tion is $1.2 billion.

You can apply in mul­tiples of $500 up to $50,000 through DBS/POSB, OCBC or UOB ATMs, or through DBS/POSB’s Inter­net Bank­ing portal. You will also need to have the indi­vidual CDP Secur­it­ies account linked to any of your bank accounts as CDP is the cus­todian for Sav­ings Bonds and it will pro­cess the applic­a­tions, interest pay­ments and redemp­tions. You may visit CDP’s webpage for inform­a­tion on open­ing your CDP Secur­it­ies account.

The alloc­a­tion will be con­duc­ted on 28th Septem­ber 2015 and the bonds will be issued on 1 Octo­ber 2015. The interest will be paid on 1st April and 1st Octo­ber every year till matur­ity date on 1 Octo­ber 2025. The interest for 1st year is 0.96% p.a., and 1.09% p.a. on second year. It will increases to 3.70% p.a. on the 10th year. So if you hold for 10 years till matur­ity, the com­poun­ded interest rate is 2.63%p.a.

Singa­pore Gov­ern­ment will issue the Singa­pore Sav­ings Bond every month. The applic­a­tion period is always 1st of the month till the 4th last busi­ness day of the month. Alloc­a­tion of the bonds will be con­duc­ted on the 3rd last busi­ness day of the month and res­ults will be pub­lished on its web­site after 3pm. Should the total amount of applic­a­tions exceed the amount on offer in a par­tic­u­lar month, you may not get the full amount you applied for. The excess cash will be refun­ded to you by the end of the 2nd last busi­ness day of the month. Sav­ings Bonds will be issued on the 1st busi­ness day of the fol­low­ing month. You will be noti­fied by CDP via mail of the amount of Sav­ings Bonds allot­ted to you. You can also check your hold­ings online through the CDP Inter­net ser­vice or by call­ing CDP at 6535–7511. The total amount of Sav­ings Bonds held across all issues can­not be more than $100,000.

You will receive the first interest pay­ment 6 months after the bond is issued. Interest will be auto­mat­ic­ally paid into the bank account that is linked to your CDP account. Interest will be paid every six months after that, on the 1st busi­ness day of the month. The interest pay­ments will be reflec­ted in your CDP statements.

There is a $2 trans­ac­tion fee for any trans­ac­tion such as applic­a­tion and redemp­tion of the bond.

You can redeem in mul­tiples of $500 on the 1st busi­ness day of each month till the 4th last busi­ness days of the month without pen­alty. Redemp­tion pro­ceeds will be paid by the end of the 2nd busi­ness day of the fol­low­ing month. If you redeem before the sched­uled interest is paid, you will receive a pro-rated amount, which is the interest you have earned but have not been paid.

New Short-term savings plan LP Revosave (3-pay-10)

NTUC Income has just launched a new short-term sav­ings plan, LP Revosave (3 pay 10) with the fea­ture of allow­ing you to with­draw cash­back (5% of Sum Assured) from the end of 2nd year onwards.
This plan provides a very good altern­at­ive to sav­ings in a bank. Not only it offers bet­ter interest rate, it provides pro­tec­tion against death, Total per­man­ent Dis­ab­il­ity (Lost of sight, two legs etc.) regard­less of your cur­rent health. It is 100% guar­an­tee to be accep­ted. You will be covered for 105% of the premium paid-to-date through­out the term.

This is how LP Revosave (3 Pay 10) works.
1) You save a fixed sum of money to NTUC Income for 3 years.

2) At the end of second year, NTUC Income will return part of the premium back (called cash­back) to you. You can choose to
a) Spend it.
b) Save with us at cur­rent 3.5% per annum interest in deposit account issued by Income

3) At any point in time, you can with­draw the money from the Deposit account.

The policy will mature in 10 years’ time.
Sample : Male age 40 years old with Sum Assured $25,000

Pay­ment Term Monthly Sav­ings Yearly Premium Yearly Cash­back (From 2nd year onwards) Total Premium Paid Total Cash upon matur­ity (Non-withdrawal) Total Cash upon matur­ity (With yearly withdrawal)
3 years $861.50 $9,940 $1,250 $29,820 $39,382 $37,671

($1250 yearly plus $27,671 upon maturity)

Com­par­ison between SP SAIL and LP Revosave (3 Pay 10)
Single Premium Plan SP SAIL with lump sum sav­ings of $29,820, the matur­ity amount is $38,577 after 10 years. So if your inten­tion is to with­draw the matur­ity amount after 10 years, LP Revosave will give bet­ter returns. Moreover, you have the flex­ib­il­ity to with­draw 5% of the Sum Assured from the end of second year. SP SAIL does not have this flexibility.