Seek Saving Acc. Opening Advice

[lewissac]

Wish to seek some advice regarding opening salary crediting account.

Currently im on POSB Saving and wish to migrate for better rates.
Working salary 2.5k, with 20k fresh funds.

I'm planning to split my fund to
1) OCBC 360
- 10k deposit into this account
- this will be my salary crediting account as my salary will be GIRO-ed faster than in other banks.
- will fulfill the 3 payment transaction and maintain above balance.
- expected rate to be: 1.75 + 1% bonus interest

2) BOC Bank saver
- 10k deposit into this account
- will fulfill the 3 payment transaction and credit/debit spending
- will receive transfer fund from OCBC for spending
- expected rate to be: 2.425%

I wondered if this arrangement works?
I'm splitting because I do not wish to put all one egg into single basket.

 

[oceanicmanta]

i wld just start with BOC first, then if concern, split when balance reach 50k (that's SDIC guaranteed amount). no point worrying over eggs under 50k IMO.

the OCBC 1% bonus refers to the incremental balance 1% bonus ? u get that on full balance on your 1st month. thereafter, it's just on incremental.

even without crediting Salary into OCBC, u can get 1.55% on alternate months

 

[LingBit]

You can do it this way, if you prefer not to put all in one account. However, I feel that 20k is not a lot, so putting all in BOC would have a much higher interest of 3.5%, and you won't have the hassle of two accounts. But as BOC is not as convenient as the other banks, I do transfer an amount to my POSB account monthly.

 

[lewissac]

i wld just start with BOC first, then if concern, split when balance reach 50k (that's SDIC guaranteed amount). no point worrying over eggs under 50k IMO.

the OCBC 1% bonus refers to the incremental balance 1% bonus ? u get that on full balance on your 1st month. thereafter, it's just on incremental.

even without crediting Salary into OCBC, u can get 1.55% on alternate months

I wouldn't want to credit salary to OCBC either. But my company somehow favors OCBC account holder for GIRO. They always receive pay faster. And I do miss my GIRO from them 1-2 times due to miss out.

 

[LingBit]

I wouldn't want to credit salary to OCBC either. But my company somehow favors OCBC account holder for GIRO. They always receive pay faster. And I do miss my GIRO from them 1-2 times due to miss out.

I am guessing your company pays your salary through their OCBC bank, thus those people with OCBC accounts will get their salary earlier by a day, as compared to other banks. The miss out should be a problem from your hr...

 

[oceanicmanta]

I wouldn't want to credit salary to OCBC either. But my company somehow favors OCBC account holder for GIRO. They always receive pay faster. And I do miss my GIRO from them 1-2 times due to miss out.

u mean company miss out Giro to your POSB ?

believe every company HR has to state when is payday & abide by it ??

say HR says payday is 22nd of every mth. OCBC accounts can get it earlier, but others shld not get it later than 22nd.

 

[vince123123]

Your arrangement works, but may not be the best use of the amount of funds that you have at this point of time.

Since the first $50,000 is guaranteed, there's not much downside to putting all into BOC.

In your proposed arrangement, the total interest you will get is ($10,000 x 2.425%) + ($10,000 x 1.75%) = S$242.50 + S$175.00 = S$417.50 on a yearly basis.

However, if you put all into BOC, you will get:

(S$20,000 x 3.5%) = S$700.00 on a yearly basis.

The question is whether the difference is worth getting your salary faster from OCBC due to the unique situation with your company.

Wish to seek some advice regarding opening salary crediting account.

Currently im on POSB Saving and wish to migrate for better rates.
Working salary 2.5k, with 20k fresh funds.

I'm planning to split my fund to
1) OCBC 360
- 10k deposit into this account
- this will be my salary crediting account as my salary will be GIRO-ed faster than in other banks.
- will fulfill the 3 payment transaction and maintain above balance.
- expected rate to be: 1.75 + 1% bonus interest

2) BOC Bank saver
- 10k deposit into this account
- will fulfill the 3 payment transaction and credit/debit spending
- will receive transfer fund from OCBC for spending
- expected rate to be: 2.425%

I wondered if this arrangement works?
I'm splitting because I do not wish to put all one egg into single basket.

 

[lewissac]

u mean company miss out Giro to your POSB ?

believe every company HR has to state when is payday & abide by it ??

say HR says payday is 22nd of every mth. OCBC accounts can get it earlier, but others shld not get it later than 22nd.

My HR always punctual in paying salary. Even if it miss out, they will still pay it with cash cheque (but u need to inform them immediately that you did not receive the salary).

 

[luvalist]

My HR always punctual in paying salary. Even if it miss out, they will still pay it with cash cheque (but u need to inform them immediately that you did not receive the salary).

sounds very wrong. Not mnc? If that's the case, u also need to make sure the transaction description "GIRO - SALARY" is correct before u move to OCBC.

 

[lewissac]

Your arrangement works, but may not be the best use of the amount of funds that you have at this point of time.

Since the first $50,000 is guaranteed, there's not much downside to putting all into BOC.

In your proposed arrangement, the total interest you will get is ($10,000 x 2.425%) + ($10,000 x 1.75%) = S$242.50 + S$175.00 = S$417.50 on a yearly basis.

However, if you put all into BOC, you will get:

(S$20,000 x 3.5%) = S$700.00 on a yearly basis.

The question is whether the difference is worth getting your salary faster from OCBC due to the unique situation with your company.

Thanks for the clarification. I think I will look into it again.
Btw, may i know if the interest interval for BOC/OCBC is monthly or yearly?
probably that would affect the compound interest. Correct?

 

[Trazora]

sounds very wrong. Not mnc? If that's the case, u also need to make sure the transaction description "GIRO - SALARY" is correct before u move to OCBC.

yea, similarly for BOC. Only direct salary credits via GIRO or BOC Salary Crediting Services will qualify for the bonus interest rate.

 

[Trazora]

Thanks for the clarification. I think I will look into it again.
Btw, may i know if the interest interval for BOC/OCBC is monthly or yearly?
probably that would affect the compound interest. Correct?

interest is awarded monthly. In a way you can say there is compounded interest but really insignificant.

 

[vince123123]

As also answerd by Trazora, interest would be awarded monthly and hence "compounded" monthly.

I did a yearly calculation in my earlier post just to make it easier to show to you, the difference between the two.

Thanks for the clarification. I think I will look into it again.
Btw, may i know if the interest interval for BOC/OCBC is monthly or yearly?
probably that would affect the compound interest. Correct?