Kopi-Oh Times

Money Matters: Taking an interest in your interest

Let’s face it, the interest you earn in a savings account sucks. With high inflation of 4% to 5% in Singapore next year, we had better put our money somewhere else.

Fixed deposits at banks are a good start, at least it beats the meagre 0.25% per annum in our POSB or DBS savings account. But fixed deposit ties up your money for a period of time, and usually you have to have a substantial minimum amount to get a good rate. For example, you need to lock in $1,000 for 18 months to get 0.925%.

Check out the rates at POSB Singapore Dollar Fixed Deposit interest rates.

http://www.dbs.com/ratesonline/fdsgd.html

Cash Fund and/or Money Market Fund are aimed at providing good short term deposit interest while maintaining liquidity on your cash. If nothing else, at least it will help to offset some part of the inflation. The interest of these are not fixed, right now it is effectively around 2% per annum.

In Kopi-Oh terms, put $10,000 into Cash Fund and interest you earn in a day will get you a cup of Kopi-Oh. Put it in your savings account and you need 8 days interest to earn you that Kopi-Oh. So … interested to know more about these interests?

Find out more at the following links to Fundsupermart and Dollardex.

http://www.fundsupermart.com/main/fundinfo/viewFund.svdo?sedolnumber=PAM036

http://www.dollardex.com/sg/index.cfm?current=investUT/fundOverview&p=%23%22%407%2B%0A