When you start working, choosing the best savings account is one of the first financial decisions that you should make. A good savings account should help you earn high interest with minimal inconvenience. In the current low-interest rate environment, even the best savings account would not earn you significant interest so don’t rely on savings alone to grow your money.
Why Do I Need To Choose A Best Savings Accounts? Don’t We All Already Have One?
Chances are that you already have at least one savings account under your name. So why do you need another one?
For the most part, those who have yet to start work will likely be using a basic account that doesn’t provide many benefits. As a working adult, you now have the opportunity to choose a much better savings account that gives you higher interest rates. But which would be the best savings accounts for you as a working adult?
Do note that some of these best savings accounts that we have shortlisted have a higher minimum average balance required, after which, a monthly fall-below fee (of $2 or more) may be charged. So you want to ensure that you can set aside at least the minimum interest each month.
Let’s compare some of the best savings accounts in Singapore that you should be considering.
- OCBC 360, OCBC
- One Account, UOB
- BOC SmartSaver, Bank Of China
- Bonus$aver Account, Standard Chartered
- DBS Multiplier Account, DBS
OCBC 360, OCBC
The OCBC 360 is one of the best savings accounts in Singapore among working adults. That’s because it has been around for a long time and gives a decent interest rate to its customers.
The past couple of years has seen OCBC revise the interest rates of its widely popular OCBC 360 savings account multiple times downwards. However, with the market interest rate rising in 2022, you can now earn high interest up to the first $100,000 of your savings. Here are the current rates.
- Monthly crediting of salary (min $1,800) through GIRO – 2.0% p.a (first $75,000), 4.0% p.a (next $25,000)[EIR: 2.5%]
- Increase your account balance by at least $500 compared to the previous month – 1.2% p.a (first $75,000), 2.4% p.a (next $25,000)[EIR: 1.5%]
- Charge at least $500 to your OCBC 365 Credit Card each month – 0.6% p.a (first $100,000)[EIR: 0.60%]
- Purchase an eligible insurance product from OCBC – 1.2% p.a (first $75,000), 2.4% p.a (next $25,000)[EIR: 1.5%]
- Purchase an eligible investment product from OCBC – 1.2% p.a (first $75,000), 2.4% p.a (next $25,000)[EIR: 1.5%]
- Grow: Maintain at least $200,000 of the average daily balance in your account and earn 2.4% p.a.
Put simply, if you have savings of up to $75,000, the effective interest rate that you earn would be lesser as compared to if you have $100,000. You will enjoy the best interest rates if you have savings of up to $100,000.
Realistic Interest Rate ($75,000 or less): 2.65% (Maximum Interest Rate: 6.25%, excluding Grow)
Realistic Interest Rate ($100,000): 3.15% (Maximum Interest Rate: 7.15%, excluding Grow)
Inclusive of the base interest rate of 0.05%, we put the realistic interest rate at 2.65% for those who have savings of up to $75,000 and a realistic interest rate of 3.15% for those who have savings of $100,000 because we don’t think it makes sense for a person to buy an insurance or investment product, just to earn bonus interest for a period of 12 months. Even if you happen to purchase these products, do note the bonus interest rate won’t be paid perpetually.
One thing that we like about the OCBC 360 Account is that bonus interest in each area can be earned independently. This means you do not need to complete any particular area in order to be eligible for the bonus interests in other areas.
Who Should Apply: Young working adults who just received their first paycheque can consider getting an OCBC 360 account and crediting their salary to it. By doing so, they immediately enjoy at least 2.0% p.a. interest on their savings, on top of the base interest rate of 0.05%. They can easily earn 0.60% more just by spending $500 a month on selected OCBC credit cards each month.
If you have savings of between $75,000 to $100,000, the OCBC 360 account gives you a higher effective interest rate.
One Account, UOB
For the past few years, the UOB One Account has been the main competitor to OCBC 360 as one of the best savings accounts in Singapore. The interest rates are somewhat similar though the UOB One Account works in a slightly different way. We will let the table below do the explaining.
An individual with savings of $100,000, and who is able to meet the criteria of 1) minimum spending of $500 plus 2) credit his salary (minimum $1,600) stands to earn an effective interest rate (EIR) of 5.03%. This excludes the cash rebates the individual gets on their UOB credit card.
Minimum Spending + 3 GIRO Transactions
In lieu of a salary credit of at least $1,600 per month, the individual can also choose to make 3 GIRO debit transactions each month. Assuming savings of $75,000, he will get an EIR of about 3.0%.
Firstly, to qualify for bonus interest, you have to achieve a minimum spend of at least $500 on your UOB One Card (which by itself, is a great card to own anyway based on the reviews from our readers) and/or other selected UOB cards. Once you have done that, you would have met the first criteria for bonus interest.
It’s worth pointing out that the bonus interest you enjoy is higher when you credit your salary (minimum of $1,600 monthly) than making 3 GIRO debit transactions per month.
Do note a distinct difference. Bonus interest payable for the 3 GIRO transactions option is up to $75,000 while bonus interest for salary credit is up to $100,000. Thus, if you have savings of up to $100,000, choose to credit your salary instead.
It’s important to note that though UOB advertises that you get up to 7.8% p.a. interest from the account, this is not really the case.
That’s because the 7.80% interest rate only applies to savings that are from $75,000 to $100,000 for the crediting of salary. In other words, in order to get this 7.80%, you first have to accept the lower interest rates the account gives you on your first $75,000.
This step-up interest rate structure means that the effective interest rates that the UOB One Account gives differ, depending on the balance in your savings account.
Who Should Apply: Assuming you have $100,000, the UOB One account gives an effective interest rate of 5.03%, which is really good.
In return, you only need to spend $500 on the UOB One card and credit your salary (min: $1,600 per month). This is fewer actions required compared to the OCBC 360 and yet you earn a higher interest.
The catch here is that you MUST spend $500 on the UOB One Card, or any other eligible UOB card, for you to qualify for any bonus interest. Otherwise, you don’t get any interest even if you fulfill the other requirements. Also, you want to have about $100,000 in savings. For instance, if you only have $15,000 in savings, then your effective interest rate will be about 3.83%.
BOC SmartSaver, Bank Of China
We once said the BOC SmartSaver had the best savings account in Singapore and got punk’d by them on the very same week when their criteria were changed. How do they fare now?
According to BOC, we can earn up to 7.00% on the first $100,000 of our account, and up to 1.00% for account balances above $100,000 to $1,000,000. Here’s how it works.
Here are some of their perks. Here is the bonus interest you can earn on the first $100,000 of your savings.
- Crediting of salary (min: $2,000) – 1.9 % p.a. If the salary credited is $6,000 or more, the interest rate is 2.5% p.a.
- Credit card spend (min: $500) – 0.5% p.a. If credit card spend is $1,500 or more, the interest rate is 0.8%
- Pay 3 bill payments (min $30 each) – 0.90%
- Bonus Interest – If you fulfill at least one of the requirements above, you will receive 0.6% p.a. on funds above $100,000, subject to a maximum of $1,000,000.
There is also a Wealth Bonus Interest of 2.4% for those who have purchased an eligible product. However, we don’t think it makes sense to deliberately buy an eligible product just to earn the bonus interest.
Realistic Interest Rate: 3.3% is what most people can expect based on the usual criteria being met (e.g. crediting of salary, spending $500 on credit cards, GIRO bill payments). For higher earners with a take-home salary of $6,000 or more, and who can spend at least $1,500 on their BOC credit cards, and perform at least 3 bill payments of at least $30 each month via GIRO or BOC Internet Banking/BOC Mobile Banking Bill, an attractive interest rate of 4.20% is reasonably achievable.
Who Should Apply: 4.2% is attractive and likely ranked the BOC SmartSaver among the best savings accounts in Singapore if you qualify for higher salary crediting, and can spend more than $1,500 a month on your credit card.
Bonus$aver Account, Standard Chartered
Another savings account that cannot be ignored when discussing the best savings accounts for working adults in Singapore is the Standard Chartered Bonus$aver Account. On paper, the Standard Chartered Bonus$aver Account gives an impressive effective interest rate of 7.88% p.a.
* The 0.41% interest rate shown on card spend from the screenshot above includes the prevailing interest rate, which is 0.01% p.a on all your entire balance.
# 1 Card Spend (up to 2.05% – inclusive of prevailing interest)
You will earn bonus interest on the first $100,000 of your deposit balance if you meet the minimum card spend.
If you have $100,000 and charge a minimum of $500 each month on your Bonus$saver card linked to a Bonus$saver account on qualifying retail transactions, you can earn an interest of 1.30% p.a. This increases up to 2.05% p.a. if you charge a minimum spend of S$2,000 each month.
# 2 Salary Credit (2.5%)
By crediting a monthly take-home salary of S$3,000 into your Bonus$aver account, you will earn a bonus interest rate of 2.5% p.a.
# 3 Invest & Insure (1.5% each, total of 3.0%)
If you have invested in an eligible unit trust (minimum subscription sum: S$30,000) or purchased an eligible insurance policy (minimum annual premium: S$12,000) through Standard Chartered, you will earn an additional interest rate of 1.5% p.a. each. This means you can potentially earn up to 3.0% if you invest and insure with Standard Chartered.
# 4 Bill Payment (0.33%)
By paying three eligible bills, of at least S$50 each, from your Bonus$Saver account via GIRO or online banking, you can earn an additional 0.33% p.a.
In total, you can earn Card Spend (up to 2.05%) + Salary Credit (2.50%) + Invest (1.5%) + Insure (1.5%) + Bill Payment (0.33%) = 7.88% p.a. from the Bonus$aver account.
Do note that the bonus interest above applies to your first S$100,000 deposit balance.
Realistic Interest Rate: If you spend a minimum of $500 on your Bonus$aver card, credit your monthly salary (minimum $3,000), and make three eligible bill payments each month, you will earn a basic interest of 4.13%. However, if you are able to spend $2,000 per month on your Bonus$saver card, your interest rate will increase to 4.88% p.a.
We don’t think it makes sense to invest or insure in a product just to earn the additional 3.0% per annum.
Who Should Apply: The main thing for the Bonus$Saver account is that your salary credit needs to be a minimum of $3,000 per month. You can apply here if you wish to enjoy attractive perks.
DBS Multiplier Account, DBS
The DBS Multiplier account could be considered one of the best savings accounts but it works in a different way compared to the other savings accounts that have been mentioned in this article.
Rather than give account holders bonus interest based on each of the requirements that they meet, bonus interest is given based on the total eligible transactions completed each month. Bonus interests can be earned on the first $100,000 of savings.
To earn the interest, you can either make an income credit (salary and/or dividends) or an SGFinDex update and complete at least one other requirement first. Otherwise, you do not receive any bonus interest.
In other words, you need to use the Multiplier account for monthly crediting of salary or dividends (no minimum amount required) or SGFinDex update and at least one of the following:
– Credit card spend with DBS/POSB
– Home loan instalment with DBS/POSB
– Insurance with DBS/POSB
– Investments with DBS/POSB
There are no minimums for each category, but to receive bonus interest, your total monthly eligible transactions need to add up to $2,000 or more.
The DBS Multiplier account gives you an interest rate based on two factors. 1) The volume of your total eligible transactions each month and 2) the number of categories where you make an eligible transaction each month
For example, an individual with a take-home salary of $2,000 who spends $400 on his DBS/POSB credit card (total transactions amount: $2,400, 1 Category) will earn an effective interest of 0.90% per annum. But if the person adds in an investment or insurance at $100 per month, his/her interest increases to 1.80%(total transactions amount: $2,500, 2 Categories).
In a best-case scenario, if I have total eligible transactions of more than $30,000 a month (e.g. $20,000 salary, $5,000 credit card spend, $5,000 home loan repayment and make an investment through DBS), I can earn an EIR of 4.10%.
Who Should Apply: Those who can’t meet the minimum salary or credit card spending requirement for other savings accounts can consider using the DBS Multiplier account since it does not impose any minimum requirement in each of these areas. You can also just use SGFinDex and just sync your data monthly.
Alternate Track For DBS Multiplier Users: PayLah! Retail Spend
The above outlines the most common (and advertised) way to earn bonus interest using DBS Multiplier. An alternate track based on PayLah! retail spending has been added, presumably for those without a credit card, insurance, home loan, or investment with DBS. Here’s how it works:
Simply clock up retail spending using PayLah! of $500 in a month, and for customers above the age of 29, fulfill the Income criteria (Salary Credit/Dividends/SGFinDex) in order to earn bonus interest of up to 0.55% on the first $10,000 in your DBS Multiplier Account.
An interesting thing to note for those under 29 is that you can earn 0.4% in interest by virtually doing nothing, which is a clever perk to entice a new generation of customers.
This article was first published on 3 July 2017 and has been updated to reflect the latest interest rates.
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