Growing your wealth doesn’t have to be mysterious or complicated. The simplest way to grow wealth is by developing and following a regular savings plan that works specifically for you. As a nation-state with some of the highest living costs in Asia and an abundance of investment options, Singapore provides expats and locals with countless opportunities to boost their savings and watch their investments grow over time.
This article will dive into how you can create an effective regular savings plan in Singapore that will help you reach financial stability while enabling you to build your short-term and long-term investments.
Benefits of having a regular savings plan
One of the most significant benefits of having a savings plan such as a Saxo regular savings plan in Singapore is that it allows you to make steady and consistent progress towards your financial goals. With a regular savings plan, you can save money each month regardless of other expenses. This is because the amount saved is deducted from your pay automatically every month and deposited into an account that can be easily accessed.
It also helps you manage your finances better, encouraging budget discipline and forcing you to avoid unnecessary spending. Additionally, with regular savings plans, you will often receive a higher interest rate than your regular savings account. This means your money will grow faster, and you can reach your financial goals sooner.
Types of regular savings plans in Singapore
In Singapore, several types of regular savings plans are available, depending on what kind of saving goals you have in mind and how much risk you are willing to take.
One popular option is the CPF Ordinary Account (OA). The OA is a long-term investment plan that allows you to save up for retirement while earning a guaranteed interest rate of 2.5%. It also offers flexibility as it allows you to withdraw funds when needed, but any withdrawn amount must be refunded within three years.
Another option is the Central Provident Fund Investment Scheme (CPFIS). This medium-term investment plan allows you to invest in local and international stocks, bonds, funds and unit trusts. You can choose between different risk levels to suit your individual needs.
Finally, there are also regular savings plans offered by banks. These plans typically offer higher interest rates than traditional savings accounts but require an initial deposit of at least S$500. The deposits and withdrawals can usually be made through branch banking or online banking, and the interest rate will depend on the type of account chosen.
How to get started with a regular savings plan in Singapore
The first step towards starting a regular savings plan in Singapore is determining what kind of plan best fits your needs.
Once you have decided on a plan, the next step is to ensure you understand all of the associated terms and conditions. This includes knowing how much money you must deposit when payments are due and what interest rate you will receive.
Once these details are sorted out, the next step is to open an account with the bank or provider offering the regular savings plan. Most banks offer online applications, so read through them thoroughly before submitting any documents. Additionally, if opting for a CPFIS or OA plan, check with your employer first, as they may offer discounts on specific plans.
Finally, once your account has been opened and funded, set up an automatic transfer of your desired amount to be deposited into the account each month. This will ensure that you are always making progress towards your savings goals.
On the whole
A regular savings plan in Singapore is essential to financial security and achieving your long-term goals. With the right plan, you can save money each month without having to worry about other expenses coming up. Additionally, you can grow your wealth faster with higher interest rates than what you get with a traditional savings account.
Before getting started, it is vital to research different types of plans available and pick one that best fits your needs. Read through all the terms and conditions associated with the plan before signing up for it, and make sure that an automatic transfer from your main bank account is set up every month. Following these steps will help ensure that you are well on growing your wealth with a regular savings plan in Singapore.