SG Budget Babe
DBS Multiplier Account
Asked on 02 Dec 2019
I've already got two insurance saving plans which I signed up for when I first graduated and it's too late for any regrets. Currently, I've been working for quite a few years and am thinking of ways to grow my savings without just leaving it in the bank (dbs multiplier ACC). Is there any other way out to earn more from my pool of savings? Thank u!!!
You might want to consider SSBs and FDs, if insurance policies are strictly a no-go for you. Unfortunately as you are not a risk taker, then the pool of assets available is really limited.
This is provided that you've maxed out the interest limit on your DBS multiplier first, as that's a pretty safe way to generate more interest.
As the rest have mentioned, beyond that, you will have to find ways to grow your income, cut your expenses if you want to save more. All the best!
The only way to grow your money is to buy assets or earn an interest on them.
If you don't want to take too much risk, then you can invest in bonds instead of stocks. Buying an investment grade bond fund can provide you income, potential growth, with very little volatility.
Investing isn't always risky. It depends on what you invest in. Buying insurance savings plans like you did is also investing and they are lower risk portfolios that can give you 3-4+% over a decade or two.
02 Dec 2019
Hmm. Given that you are not considering investing and buying more insurance saving policies (personally I am not a fan of that):
1. EARN MORE. Be it side income or increasing pay (may be more difficult). Nuff said.
2. SAVE on daily necessities. Buy kopi from kopitiam instead of Starbucks. Eat economy rice instead of McDonalds or anything that costs $10 for not alot of nutrition.
3. DON'T buy anything unless absolutely necessary. Like, no bubble tea. Jokes aside, this means buying clothes/shoes only when you need to replace it. Keep entertainment expenses to a minimum.
4. BONDS and HIGH I/R SAVINGS ACCOUNTS. For the low-risk appetite - these are the options you still can go for.
If you view your CPF as a wealth accumulator, the CPF option is one of the very best out there.
The Topping up into CPF SA gives you tax deduction in the first year and then you earn 4% interest per annum. Of course, ppl will dispute you can't take money out, but i view CPF money is our own money and at age 55, there is a high chance we can withdraw the excess of BRS sum
I put some of my faith in the CPF system and in fact, did some transfer with my cash to the CPF-SA account. So just treat it as a stash-&-forget mentality, and I'm sure you'll reap the rewards at a much later stage.
You might want to consider doing so. :)
Find a side hustle with low starting capital (since you're a not a risk taker). Can be your hobby or anything really, I know a home based tailor who takes up ad-hoc tailoring requests on weekends on top of her full time job, just put your skills to good use haha.
Increase your pay - year end performance review should be happening about now, good time to ask about your pay increment
Cut down on unnecessary expenditure
If you're not looking to invest in stocks, you can look for bonds or higher interest savings accounts. These will be better in terms of risk. Also, you can of course save more money.
Technically you are already investing by buying insurance saving plans. And they can be quite risky too! Haha.
Lower risks investments are probably just bonds/FD; you gain a net 1.5-2% interest rate which may just help you to beat inflation in the short term.
The property market is rather overpriced now, but if you have excess cash and you find a good deal, buying a property and then renting it out will also allow you to earn more 'income'.
'Invest' into your CPF-SA account, this will net you more gains when you hit 63.
Hi, in financial planning, our money can be divided into different roles (and therefore accounts) to achieve different purposes and goals:
E.g. keeping 3-6 months of your income as contingency buffer in savings accounts and easily liquidable short term bond funds, having a baseline of wealth protection insurance policies to secure your current and future income, putting aside perhaps 10% of your salary towards retirement planning every month (the earlier you start, the less you need to put in and the easier you accumulate), and so on.
So the more effective and systematic way would be first to identify what your goals and needs are at this stage of your life and position your money accordingly. You may even find that there could be an allocation for investing that is within your comfort level. My point is not to dismiss any viable financial vehicle too quickly. It is also more systematic and clearer to tag different pockets of your money to different goals and timelines, rather than a general "grow my savings". That way you will have a more appropriate financial strategy and a better idea of your financial portfolio.
By not investing (not even considering low-medium risky tools) ironically you are exposed to the greatest risk that is of inflation, compounded over time.
The only option you have to squeezing more juice from your savings will be putting money into the CPF S.A account (earn extra interest) and/or SRS (reduce income tax).
First of all, have a full and complete understanding on your cashflow. I have listed out the key things to look out for here: https://www.blog.pzl.sg/understanding-your-personal-cash-flow/
Once you have a complete understanding on your own financial situation, analyse and evaluate if there is any way to increase your income and/or decrease your expenditure.
Thereafter, it is always valued and important to have a proper insurance portfolio summary. I have highlighted the reasons here: https://www.blog.pzl.sg/why-every-client-needs-an-insurance-policy-summary/
Through this process, you will have a proper and clear understanding on your portfolio's situation and to see if any fine tuning is required. Always plan with the long-term in mind while not shortchanging yourself in the short-term.
The best way to have more savings is always to have a budget. This is how I do mine: https://www.blog.pzl.sg/how-to-create-a-monthly-budget/
So long as you follow through the system and do constant reviews yourself, I am confident that you will definitely save more money without investing or buying more savings policies.
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