How to get the best interest rates for savings of S$1000

You are fresh out of National Service, polytechnic or the university.

You just secured your first job.

You are excited, exhilarated and excited on seeing that first thousand (or more) dollars in your bank account.

Returns on savings accounts and fixed deposits are low
Then, reality sets in... How do you get any decent return on your savings given that the average savings rate and even fixed deposits (time deposits) rates are at a low level of less than 1%? To makes matter worse, fixed deposit rates are usually only given for balances of at least $5,000 to at least $50,000 or even $100,000 for the higher interest rates to be available.

So what does that leave you, a young up-and-coming professional who wants to work hard, save and invest the money in relatively safe assets that generate decent returns?

The solution
Two words: Treasury Bills

My earlier post describes the detailed steps in investing in treasury bills issued by Monetary Authority of Singapore through the POEMS trading platform.

What is a treasury bill
Now what exactly is a treasury bill?

Wikipedia defines it as:

"Treasury bills (or T-bills) mature in one year or less. They are like zero-coupon bonds in that they do not pay interest prior to maturity; instead they are sold at a discount of the par value to create a positive yield to maturity. Treasury bills are considered by many to be the most risk-free investment for U.S. investors. Treasury Bills are commonly issued with maturity dates of 28 days (~1 month), 91 days (~3 months), and 182 days (~6 months). Treasury Bills are issued each Friday after weekly auctions which are held on Wednesday at about noon. Purchase orders at TreasuryDirect must be entered before 11:30 on the Monday of the auction. Mature T-bills are also redeemed on each Thursday. Banks and financial institutions, especially primary dealers, are the largest purchasers of T-Bills. They are quoted for purchase and sale in the secondary market on an annualized percentage yield to maturity, or basis. With the advent of TreasuryDirect, individuals can now purchase T-Bills online and have funds withdrawn and deposited directly to their personal bank account and earn higher interest rates on their savings."

Singapore Government issued treasury bills work the same way except that the minimum tenure is 3 months. There are also other Singapore Government Securities that even retail investors can buy from the primary dealers.

How to invest in treasury bills
Get starting with investing as little as S$1,000 into treasury bills today and get a better return on your money in your savings accounts today!