Everyone needs a savings account in Singapore. The benefits for savings account differs from bank to bank in terms of interest rates, fees and various features to appeal to depositors.
This is where compounding works. Usually for savings accounts, the interest rate is 0.05% that is credited at the end of every month.
0.05% will be below the year-on-year inflation rate. Although it sounds counterintuitive, you are actually losing in purchasing power due to inflation when you keep your savings in the basic savings account.
Editors Note (14 July) : The Saving Account used above for OCBC refers to the OCBC Frank Account. There is no monthly servicing fee for account holders below the age of 26. For account holders 26 and above, a monthly servicing fee of $2 do apply if monthly balance falls below $500.
One differentiating factor the various savings accounts have is the features they offer either on their app or online portal. Some have tools for you to visualise your personal financial health. For example, Maybank can remind you to pay your bills via SMS.
For OCBC, they weight your assets against your liabilities (if you take a loan with them). POSB allows you to see your balance in terms of a bar chart upon login.
Most banks offer Touch ID login for quick access. POSB’s DigiBank app has a cool feature that allows you to swipe to see your bank balance without even logging in. If most of the time you simply want to check your bank balance and nothing else, POSB may be your preferred savings account because of this feature. Maybank offers SMS reminders for bills, so you won’t get late payment charges just because it slipped your mind.
Given the low interest rates savings accounts offer, it is not a good idea to let your savings devalue against inflation. While it is a better option to invest savings, we still need to have some funds in savings accounts for our day-to-day expenditure. To choose your savings account, it is better to look for features that make your daily money management easier
Read Also: 3 Ways To Protect Your Retirement Savings
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