To this point, I’ve utilized for T-bills principally with money, utilizing principally cash from maturing fastened deposits.
As increasingly more cash acquired locked up in T-bills in addition to recent fastened deposits with larger rates of interest, I reached a stage the place I did not have anymore money to use for T-bills.
Then, I discovered some cash enjoying truant at residence which I rapidly put to work in T-bills in February.
Sadly, except I had a cash tree at residence, it will be unimaginable to seek out extra money enjoying truant at residence.
I nonetheless wish to proceed getting T-bills as a way to preserve a significant publicity to fastened earnings particularly throughout this era of a lot larger yields.
After all, till a number of months in the past, for a few years, at the same time as a retiree, I used to be doing voluntary contributions and top-ups to my CPF account to realize this aim.
I’ve at all times considered the CPF as an funding grade authorities bond which provided comparatively enticing yields whereas having an annuity angle.
So, though it’d seem to be I’ve just lately developed a fascination for fastened earnings, I actually have not.
It has at all times been an vital a part of my funding portfolio.
Anyway, I checked out how a lot cash I may need left in my SRS account and CPF-OA as we are able to purchase T-bills utilizing cash in these accounts.
My SRS account just lately acquired a leg up as I offered my funding in SATS, reserving a modest capital achieve within the course of.
My CPF-OA nonetheless has some $52K accessible for professionally managed merchandise.
I’ll cut up the $18K accessible in my SRS account into 3 equal components and apply for the three T-bills on supply within the month of March.
These could be non-competitive bids as I think that the cut-off yields for all of the T-bills to be auctioned within the month of March could be significantly better than the SRS rate of interest.
That is one prediction my bowling ball which thinks it’s a magical crystal ball goes to get proper, I really feel.
Sure, I mentioned to my bowling ball, “You win liao lor!”
The $52K accessible for funding in my CPF-OA, I’ll make a aggressive bid for the T-bill closing on 1 March.
I’m bidding very near a 4% yield this spherical as I see inflation knowledge coming in sturdy and likewise a strengthening US$ towards the S$.
If unsuccessful, I’d lose $2.70 in utility price which might be unlucky.
Nevertheless, as the applying is being made on-line, the fee actually is not that prime like earlier than.
On-line utility saves me a visit to the financial institution and, fairly presumably, a very long time in a queue.
It is extremely lucky that DBS has made on-line utility for T-bills utilizing CPF-OA cash accessible.
If profitable, I’d lose solely a month’s price of curiosity earnings (i.e. for the month of March) from CPF-OA because the T-bill will mature in early September.
This could give me ample time within the month of September to switch the cash from the CPF-IA again to the CPF-OA in order that I’d not lose one other month’s price of curiosity earnings for the month of September.
That is not like the 1 yr T-bill which I utilized for in January utilizing CPF-OA cash.
For that T-bill public sale, my bid yield was only a bit greater than 3.4% p.a. as that was the rate of interest OCBC provided for fastened deposits positioned utilizing CPF-OA cash.
The cut-off yield for that T-bill was 3.87% which wasn’t a nasty end result.
That 1 yr T-bill began on the finish of January 2023 and matures on the finish of January 2024.
So, for that T-bill, sadly, I’d lose 2 months’ price of CPF-OA curiosity earnings for the months of January 2023 and January 2024.
Simply speaking to myself about T-bills.
If you’re new to eavesdropping on AK, please don’t soar to the conclusion that that is all that we’ve to do to realize a big stage of economic safety and, in the end, monetary freedom.
For the overwhelming majority of us, fastened earnings alone isn’t going to get us to monetary freedom.
Should you want structured steering on the right way to be a profitable investor for earnings, there may be at all times Dividend Machines which closes at 23:59 hours as we speak.
If you’re , I blogged about Dividend Machines earlier this month right here:
Banks & REITs Dividend Machines.
References:
1. CPF or SSB?
2. Have $10K? Make investments or save?
3. Adjustments to portfolio (Feb 23.)
