How credible is the Singlife Savings Account?

With recent reduction of interest rates in a large number mainstream saving accounts under banks due to the technical recession, how is Singlife able to maintain its 2.5% interest p.a.? Anyone can explain how Singlife is able to provide the $250 to give its customers annually (assuming $10k in savings) and how is it sustainable?

Singlife Account

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Gideon Ng

20 Jul 2020

Blogger at FI Pharmacist

Hi Anon, unfortunately SingLife does not disclose how it is able to maintain such an attractive interest rate.

Usually, insurance companies will use the funds that they have been given via our deposits to put into investments. So it really depends on how the investments perform for SingLife to be able to maintain the 2.5% interest rate.

The good thing with the SingLife Account is that it is insured under the Policy Owners' Protection Scheme under the Singapore Deposit Insurance Corporation. This means that your capital is guaranteed as the SingLife Account counts as an insurance plan, and you will get back your capital should SingLife close down.

If you'd like to find out more about the SingLife Account, you can check out my review on it here.

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Tan Wei Ming

20 Jul 2020

Founder and Writer at Frugal Youth Invests

Singlife does not provide any information on how it utilises clients' funds but if you look at Elastiq, it mentioned that it invests in Bond. Therefore, we can assume that Singlife is doing the same too.

The difference between insurance savings plan and bank is that the former does not use clients' funds to loan out to other people like the banks. They are actually less affected by the interest rate.

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