I gathered that the best savings account with the flexibility of withdrawing should you need the money to make further investment will be:
1.RHB
With its IR up to 0.78%, even if it's only $5000, you are already getting 0.48% p.a. which way beats the usual savings account rate. And you don't have to worry about all the step up IR, just throw in a lump sum.
2. CIMB Bank
I am especially intrigued with this one. With an initial deposit of $5000, IR will be 0.5% p.a.. And with an incremental deposit of S$500 or more, the IR becomes 0.8% p.a. The bank also suggest that if you throw in a lump sum, they will divide the portions into $500s so you will always enjoy the 0.8% p.a.
My question is this,
Assuming I have a S$100,000 to park, how does the IR distribution goes?
1st month $5000 (0.5% p.a)
2nd month $5000 + 500 (0.8% p.a)
3rd month $5500 + 500 (0.8% p.a)
Then the rest of the money parked there enjoys no IR, until my money is queued to be deposited? (I know I have not included compounded interest in the above analogy but I am trying to simplify things, given that I am already confused. Haha)
Secondly, if I decide to place my $100,000 at RHB (to enjoy the 0.48-0.58% meanwhile), open an account of $5000 with CIMB then incrementally deposit more than $500 every month. It is said that "CIMB will automatically convert your lump sum deposits into equal portions of S$500 a month so that you enjoy the 0.8% p.a. maximum interest on your entire savings balance over the months ahead."
So what qualifies lump sum, assuming I deposit $20,000 monthly, is this lump sum and they would quantify it as a 40 months of S$500.
Or how about if I deposit $1000 monthly, will this amount be converted to equal portions of S$500 a month and this brings me back to the 1st question, what happens to the excess funds?
Sorry if I just sound like I am confusing myself. I am new to this and is just trying to know how it works and where best to park the money while I await a good investment opportunity. Thank you!