Looking for higher interest rates?
If you are looking for an alternative to Fixed Deposit, the 1 year T bills
will be the one to look out for.
Unlike the 6-month T bills, available twice monthly, the 1-year T bills are
only available once every quarter. The first offering in January resulted in a
yield of 3.87%.
Want to find out more about T bills? Check out our How to Invest in T Bills Guide .
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How Much should I bid?
The last 6 months’ T bills closed at 3.75%. Fixed deposit for 1 year is hovering around 3.8-3.9%. Based on these, the 1 year T bill range would be around 3.7-3.95%
Who would subscribe to 1 year T-bills
For those who prefer an alternative to Fixed Deposit
Fixed deposit for a year has been comparable rate to 1-year T-bill rates.
However, there will be those looking to diversify due to the credit rating of
T bills.
For those with a smaller amount to place for the long term
The quantum is usually large to get the highest tier in fixed deposit.
T-bills offer the same interest regardless of amount, so those starting with
$1,000 would benefit from the higher rates.
For those looking for higher returns for CPF Ordinary Account
CPF Ordinary Account is only paying 2.5%. There is a good chance of at least
another 1% if one invests in T bills.
