Bank interest rates have been so low for so long that it does not really matter anymore. In recent years, banks have been promoting higher interest rates on your deposits (of course, with an * asterisk).
In one of my entries, I have highlighted that I have a sum of money that I will only use if there is a big stock market correction. And since the money is in the bank, I will definitely make sure it works for me, in terms of earning interest.
This is not an advertorial entry. I am personally using the products - mentioned below - to at least get some decent interest.
Wake up your money with up to 3.05% p.a. - OCBC
OCBC 360 deposit account has a base interest of 0.05% p.a. for account balances up to S$200,000 or 0.15% p.a. for balances above S$200,000. However, you can earn bonus interest on the first S$50,000 of your account balance.
The bonus interest is only credited if the following actions are taken:
1. Earn extra 1% p.a. - Credit your salary every month to own OCBC 360 deposit account.
2. Earn extra 1% p.a. - Pay any 3 bills online or with GIRO from your own OCBC 360 deposit account. Phone bills, other credit cards' bills etc.
3. Earn extra 1% p.a. - Spend a total of at least S$400 on an OCBC credit card monthly.
As they always say, there is no free lunch. Crediting your salary and paying the bills through OCBC online banking system is an easy way to earn the extra 2% interest. As for the additional 1%, if you are already spending S$400 monthly on another credit card, you could easier do the switch.
If we earn the full 3.05% interest p.a., that will work out to be S$1525 annually.
|Screenshot from http://www.ocbc.com.sg/personal-banking/accounts/360-account.html - dated 11 Aug 2014|
Bonus$aver - Standard Chartered
Another product that has been in the market for a longer period is Standard Chartered Bonus$aver. The base interest is at 0.10% p.a. for account balances up to S$200,000 or 0.20% p.a. for balances above S$200,000. And if you spend S$500 on your Standard Chartered credit card each month, you will earn additional 1.88% p.a. on your savings up to S$25,000 balance.
Just one clause, and no free lunch.
Again, if you earn the full 1.98% interest p.a., it will work out to be S$495 annually.
|Screenshot of a Standard Chartered advertisement on Bonus$aver|
Good Interest Earn at No Risk
I personally feel that it is good interest earned at no risk. This is exactly what I have signed up for.
So how do I work the system? I used my Standard Chartered credit cards to pay for monthly insurance policies' payment. It is automatically charged to my credit card monthly. And I just have to pay the insurance bill to earn the bonus interest. As for the OCBC credit card, it is used to pay for my monthly groceries shopping, petrol, food etc. The S$900 are expenses that I will have to incur every month anyway.
Therefore, by earning interest from my spending, why not?