Little Bit of Calculation Whether SSB Makes Sense Now
On Sunday, I made a video talking about some of my money moves now that rates are dropping. The response has been pretty staggering for my channel: the video hit more than 15,000 views in a single day and is still growing steadily.
Definitely catch it if you haven’t already done so to have some context to what I’m discussing in this article:
Does SSB Now Make Sense For My Emergency Funds?
Personally, I feel that the gap between SSB rates and things like bank deposits, t-bills etc. has narrowed to a point where SSB makes sense – at least for September 2024 while rates are still above 3% p.a.
This is especially so if one is confident that the funds you place in SSB will not be touched for years. My emergency funds fit such a profile because such amounts are generally left alone somewhere to collect dust and interest and we hope we never ever really need to touch the money.
In the past year or so, I’ve always thought about putting such funds into SSB but other options were too attractive. The highest SSB in recent times gives barely 3.30% to 3.40% p.a interest, and that looks pretty bad against things like UOB One which could for a time easily fetch 5% p.a. The opportunity cost has been a little too big for me to consider SSBs until now.
Rough Calculation
Needless to say, this isn’t financial advice for you to follow, but I’m just pondering my options out loud.
Based on S$150,000, UOB One gives 4% p.a. right now, but what if it steadily declines over time to around 2% p.a? I did a bit of calculation to see what happens if bank rates slide steadily over the years:
| Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | Total |
| SSB Rate | 3.06% | 3.06% | 3.06% | 3.06% | 3.06% | 3.06% | 3.09% | 3.17% | 3.21% | 3.21% | – |
| Interest | $4,590 | $4,590 | $4,590 | $4,590 | $4,590 | $4,590 | $4,635 | $4,755 | $4,815 | $4,815 | $46,560 |
| Bank Rate | 4.00% | 3.75% | 3.50% | 3.25% | 3.00% | 2.75% | 2.50% | 2.25% | 2.00% | 2.00% | – |
| Interest | $6,000 | $5,625 | $5,250 | $4,875 | $4,500 | $4,125 | $3,750 | $3,375 | $3,000 | $3,000 | $43,500 |
If interest rates decline over the years, I’m better off with SSB. Not only is the return higher, I don’t need to worry about meeting things like salary crediting, card spend, or any other silly requirement banks might impose in future. Perhaps even more attractive than the 10-year guaranteed returns is the fact that SSB has no requirements to be met. The fuss-free nature of SSB is very appealing, and something I’d pick even if SSB’s interest is slightly worse.
But why 2% p.a? It’s just a number I pulled out of nothing, so take this with a pinch of salt. If interest rates go down more and even faster, SSB would fare even better in comparison. It’s also entirely possible that rates go down slightly but stay elevated for many years to come, and SSB is inferior as a result.
Anyway, SSB is Very Liquid
I don’t have a crystal ball to predict how rates will go, but I’m still going with SSB because of how liquid it is. Should I really regret putting funds in here, full or partial redemption is easy and relatively painless.
In the short term, there is still opportunity cost by giving up higher rates of bank promos for SSB. To be fair, I guess getting a slightly lower rate isn’t all that bad given I’m putting funds with our triple A rated government.
Stay Subscribed For Updates and Great Deals
Would you be putting funds into SSB this month? Applications for September 2024’s SSB close tonight at 9PM. I’m hopeful that the tranche isn’t oversubscribed, but do stay subscribed for updates and more great savings deals.
Seth Wee was a licensed financial adviser representative from 2009 to 2025, with over 16 years of experience in Singapore’s financial advisory industry.
He started Sethisfy.com in 2019 to share practical insights on credit cards, banking products, and miles strategies, helping readers identify financial products that deliver the best value. Seth has been featured in CNA, Channel 8, Today, and a host of other publications. In 2025, he was also part of a panel at CPF’s Ready For Life festival.
Subscribe to the channel for free updates!
Disclaimer: I may receive an affiliate/referral fee when you sign up for services/products on this site, and such fees keep the site running. I would only recommend services/products I would personally use or recommend to my own friends and family, but I do not provide any warranty or guarantee for the quality of these services/products. Thank you for supporting my site!
Please exercise due diligence when signing up for any service/product as I will not be liable for any personal loss, financial or otherwise. Content published here are my sole views and personal opinion, and none of the information here constitutes personal financial advice nor represents the views of my employer(s).