This could be due to my own background. Coming from a low-income family, I was eligible for bursaries throughout my school life and I have always been very grateful for that. Receiving money has given me a lot of opportunities and doing relatively well in school has its benefits in a meritocratic society like higher-paid jobs. I'd hoped that by helping others to plan their finances, that perhaps they can have more money to give back to others in need too (although I came to realise this was a bit naive as people who want to give would find the means to give even if not monetary).
So what's spurring today's topic on high interest savings accounts (HISAs)?
During this circuit breaker period, I've found it impossible to get access to a printer! With the libraries closed and minimal businesses open, I have no where to go to get my documents printed. I signed up for the DBS multiplier account (a HISA) and tried to apply for one of the credit cards but alas, it required me to print out the form I filled in digitally, and to sign it before mailing it. I'm not sure why DBS still need things to be done physically when I've requested for credit cards purely online multiple times from other banks.
With many HISA clamping down on interest rates due to lowered interest rate in the US, I decided to re-evaluate my current HISAs and switch accordingly. So HISAs are all very complicated with the T&Cs. But for the most part, they usually require salary crediting, minimum spending per month on credit card, GIRO transactions to attain the interest rate.
Most of them advertise with super high interest rate like 3.88% but only by reading in detail, do you realise that that is offered only if you hit all criteria that they have set out, and only for the next 15k following the first 60k (which will have a lot lower i/r) in the bank. There's no single HISA that is the best for everyone. It really depends on each individual's spending and saving habits (and whether they draw a salary).
Here are some examples of HISAs in Singapore currently:
- DBS Multiplier
- UOB One
- OCBC 360
- CIMB FastSaver
- BOC SmartSaver
- SCB Bonus Saver
- ...
- SCB JumpStart (I highly recommend this if you are eligible. You have to be between 18 and 26 to open the account. The first 20k balance will command 2% interest and there's no criteria! The debit card that comes with the acct is very decent with 1% cashback on eligible spend)
For my own use case, I realised that with some of my HISAs modifying interest rates, by switching to DBS multiplier account, I can get a higher yield. The following table shows the changes for interest rates for DBS MA (from Seedly).
So for me, my monthly transaction just from income alone falls in the $5-15k band. However, it does require that I transact in one more category which shall be credit card spend (any amount) for me to achieve the 1.8% on the first $25k. I'm not very close to the next band, so I don't think it's worth it to push to it from CC spending.
Unfortunately, DBS has quite shitty credit cards (if anyone from DBS is reading this, take this as customer providing her satisfaction). The best credit card I think is the DBS altitude card. However, I'm a cashback-first person and I already have a miles card which has the exact benefits as what DBS is offering. Live Fresh card is another okay option but these days I really don't like minimum spend requirements so that is also out for me.
I decided that I will stick to spending on my existing credit cards but hold a DBS CC for minimal spending each month just to satisfy the requirement for the multiplier account interest rate. I've chosen the NUS Alumni card because of the 2 years fee waiver (I'm guessing they won't waive fees off the other cards if I'm only going to be spending a dollar on the card each month). Probably in 2 years' time, things would have changed and interest rates would be revised so I'll probably do another re-evaluation when the time comes. For now, stick to free!
I decided that I will stick to spending on my existing credit cards but hold a DBS CC for minimal spending each month just to satisfy the requirement for the multiplier account interest rate. I've chosen the NUS Alumni card because of the 2 years fee waiver (I'm guessing they won't waive fees off the other cards if I'm only going to be spending a dollar on the card each month). Probably in 2 years' time, things would have changed and interest rates would be revised so I'll probably do another re-evaluation when the time comes. For now, stick to free!
I've always been a huge fan of the UOB One account and I must say that I am hugely disappointed by the changes (again, pic from Seedly):
It used to be such an amazing account and I never fail to promote it to my friends whenever the topic arises. 😂 One can get 1.85% and up from the first dollar onwards in Category B (providing that some criteria is satisfied)! Now it's reduced to a measely 1.25%. Ah well!
That said, I think most of my friends are quite lazy to switch banks / cards even with quite clear benefits, so banks definitely still retain their customers even if they no longer have a competitive HISA.
I think to some people 0.5% seems small and don't matter much too. I don't fully agree with the view. I think all it takes is an hour or two max to re-evaluate and switch (I'm including the time it takes to switch over GIROs, salary crediting, etc. tied to previous account apart from application) and you can be saving $100 off a $20k balance in a year. Getting paid $100 for about 1-2 hours of work is definitely worth it to me!
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