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SeedlyTV S2E07

Easy Strategies For Beginners To Save up! Live on Wednesday, 27 May 2020, 8pm

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SeedlyTV S2E07

Singapore Saving Bonds (SSB)

Savings

Savings Accounts

Since I can withdraw SSB without much penalty, should I keep emergency funds in SSB?
Hi anon, This would depend on the SSB interest rate at the moment. If the rates are good, you can put them in SSB, but with staggering of your funds. They're terrible now though. High interest savings account would work best, and if you have maxed that out, then move into SSBs/FDs or money market funds. As an example, you could divide your emergency funds into 3 portions, one in your bank with enough to last 3-4 months, another portion in SSBs to last 3-4 months, and the last one in a 1 year FD or similar. This ensures that you have liquidity, as you would only need prepare to cash out the SSB when your balance in your bank drops to around 1 - 2 months of your expenses.
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SeedlyTV S2E07

Investments

Savings

Savings Accounts

Robo-Advisors

Online Brokerages

Stocks Discussion

ETF

When you have saved up your emergency funds, is it recommended to invest part of it?
Hi anon, I would not recommend doing so. Just keep them in a high yield savings account first, or consider short term FDs, SSBs or money market funds, depending on the returns. They are never to be touched unless you have an emergency. Yes, there's an opportunity cost to not investing them, but this is just how it works. In time, even our emergency funds need to grow in tandem with inflation and rising expenses. So in a way, you should try to ensure that your fund grows a little every year.
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SeedlyTV S2E07

Savings

Savings Accounts

Are there any downsides of having a savings plan? If yes, what are they and what are some considerations I need to take note of before having one?
N
Ninja
Level 6. Master
Answered 2h ago
A savings plan is intended for u to use it for a goal. But 99% of the time people surrender because there isn’t any liquidity. For those plans that return you money after two years, don’t be elated. Those are your own money, why be happy?
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Investments

Savings

Insurance

Endowment Policies

Savings Accounts

SeedlyTV S2E07

Is a savings plan with an insurance company necessary?
Hi anon, A savings plan would be a good asset to have if you have a time bound commitment (such as children's education) that must have funds ready at a specific time interval, or if you do not wish to be exposed or take on the ups and downs of the market. Nowadays, there are also perpetual saving plans whereby you contribute for some years, and the policy will continue to grow till age 99, backed by a minimum guaranteed floor, and boosted by the upside potential of the participating fund. I find such policies getting more popular, since we don't know if we will need our funds some day, but we also want our money to grow at a rate better than what the banks will provide. Annuities are also something that you can look at, they are a form of savings too. If however, you are comfortable to take on risks and returns, and don't have a particular timeframe in mind, you would be better off allocating a larger portion of your cash and cash flow to investments.
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SeedlyTV S2E07

Investments

Endowment Policies

ETF

Insurance

Investment Linked Policies (ILP)

Online Brokerages

Investing into ETF fund vs Endowment plan - which is a wiser choice given that I am an 18 year old investor?
I can't say which is a better choice. You should spend some time understanding both asset classes. One gives you the returns of the market, but it can also give you the losses. The other is a guaranteed return investment with downside protection and some upside potential, regardless of market conditions. Which would you prefer? (This, you have to answer yourself) If you have enough budget, there's also no harm doing both. Protecting our downside is part of risk management when investing. Endowments offer a way to do just that for a portion of your portfolio, without any intervention or management needed from your end.
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SeedlyTV S2E07

Singlife Account

Savings

Savings Accounts

Interest Rates

Would you suggest someone who is self-employed to put their savings with Singlife Account, since they provide the interest of 2.5% p.a. for the first 10k and 1% p.a. for the next 90k?
G
Gaius
Level 3. Wonderkid
Answered 5h ago
In my opinion, its a really good place to put your "emergency fund". Since most people have expenses of around 1.5-3k a month, saving 3-6 months worth of expenses for an "emergency fund" usually amounts to around 10k. The best part about Singlife imo is that there are no requirements to meet in order to get the 2.5%. Just set it up and forget it. Because of that, its definitely a good idea. However, if you're going to be spending the money, I think opting for a debit/credit card that has spending rebates and a reasonably high interest rate would probably be a better option. I personally have the Standard Chartered Jumpstart account that gives 1% cashback and 2% on the first 20k since I'm still pretty young, but you'll have to find out what works best for you. Cheers!
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SeedlyTV S2E07

Endowment Policies

Insurance

Savings

I have a 20 year endowment that my parents bought for me since when I was young. Should I continue on holding to it if I want to invest instead?
If you are unable to fund it, the policy should have sufficient premiums to "pay itself" through an automatic premium loan feature. Through this, given the few years left, the return will still be better than an outright surrender. Request for a revised policy benefit illustration, one with full payment and one with APL. Compare both and assess your options.
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SeedlyTV S2E07

Investments

Savings

Passive Income

How to create a passive income? I am a 19-Year-Old investor aiming to self-pay for my university (SMU ~$66K), after my NS (yet to enlist). Which investment paths should I look at?
Invest in yourself. You have to work. That will be your highest return on time and investment in your youth. There is no substitute for hard work. Keep expectations on investments low and do not expect it to fully fund your education. Making it your only source of cash inflow is risky and concentrated and certainly not guaranteed. $100k by 25 is entirely possible. And it is very possible to accumulate that in one year. You do not need 6 years, even if you are in your early 20s. The question is, do you have what it takes to learn the skillsets required to achieve that? Stay humble, try new things, knock on doors, and opportunities will come. As for investments, the only type of investments which can attract 100x of your money are extremely risky, you have to be prepared to lose the entire capital, even owing debt if you leverage and gear your moves. As such, it is often not recommended to assume such risks when you are younger. The safer path is to explore ways to increase your cash inflow with opportunities that requires very low capital requirements.
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SeedlyTV S2E07

DBS Multiplier Account

DBS digiPortfolio

Investments

Savings

Savings Accounts

Interest Rates

I am currently enjoying the highest interest rate possible on the DBS multiplier (2 categories). Should I get another savings account or invest the excess money (amount above 50k) into digiportfolio?
Tay WenHao
Tay WenHao
Level 6. Master
Answered 21h ago
Hmm, why not unlock a 3rd category to get high interest up to 100k? Tips to unlock DBS Multiplier - Salary (must have) - Credit Card (easy to have) - Investment (Monthly DCA thru invest saver. As low as $100/month. Choose STI ETF, quite stable. After 1 year just cancel and most likely can get back full capital with abit of gain) - Insurance (Take a look into CancerCare) same thing. After 1 year can cancel since it will not be eligible after 1 year.
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SeedlyTV S2E07

OCBC Frank Account

DBS

Standard Chartered JumpStart Account

Savings

Savings Accounts

I currently have OCBC Frank, DBS eSaving, & SC Jumpstart account. Is OCBC Frank Account okay for savings?
Tay WenHao
Tay WenHao
Level 6. Master
Answered 21h ago
I agreed with Zhe Liang. Just put all your money in SCB Jumpstart (for higher interest) except your daily expenses. In fact, whenever you need to withdraw money, you can transfer money from SCB to POSB/OCBC (depending on which ATM) within seconds.
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