Where to park your cash for higher yield? T-bills vs Fixed Deposit vs SSB (Dec 2024)

As we approach the final days of the year, many investors are wondering about the best place to park their cash for higher yields.

I noticed from the discussion in the Beansprout community that DBS recently lowered its fixed deposit rate, and the yield on the latest Singapore T-bill also declined in the most recent auction.

This prompted me to explore simple, hassle-free options that still offer yields of 3.0% p.a or above.

In this article, I will share the following:

• Latest interest rates on fixed deposits, T-bills, SSBs and money market funds
• Advantages and disadvantages of putting your cash into these options
• What I would consider in deciding between fixed deposits, T-bills, SSBs and money market funds
• My strategy for parking my cash to earn a higher yield

Best 3-month fixed deposit rate in Singapore of 3.20% p.a.

Firstly, let's take a look at the best fixed deposit rates in Singapore in December. 

• The best 3-month and 6-month and fixed deposit rate is 3.20% p.a. offered by HL Bank for a minimum deposit of S$100,000.
• For smaller deposit amounts, Bank of China and ICBC offer a 3-month fixed deposit rate of 3.0%.
• The best 12-month fixed deposit rate we found was 2.90% p.a. offered by RHB.

To get the latest list of best fixed deposit rates this month, check out our guide to the best fixed deposit rates in Singapore.

Latest 6-month Singapore T-bill offers yield of 3.0%

The yield on the Singapore T-bill slipped in the most recent auction.

The cut-off yield on the 6-month T-bill in Singapore fell to 3.0% in the recent auction on 5 December 2024 from 3.08% in the auction on 21 November.

With lower yield on the T-bill, it is close to the best 3-month fixed deposit rate for deposits of below S$100,000.

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Best no-frills savings account in Singapore offers interest rate of up to 3.23% p.a.

If you are looking for a no-frills savings account to park your savings, the CIMB FastSaver Account is offering a promotional interest rate of up to 3.23% p.a. for fresh funds up to S$75,000 without salary credit until 28 February 2025.

GXS is also offering a fuss-free interest rate of up to 3.18% p.a. for a 3-month tenure through its Boost Pocket. Learn more about the GXS Boost Pocket here. 

The HSBC Everyday Global Account (EGA) is offering a promotional interest rate of up to 3.05% p.a. for deposits of below S$2 million. In addition, you can earn an additional 1% bonus interest rate on the incremental SGD average daily balances under the HSBC Everyday+ Rewards Programme.

Learn more about the best savings account in Singapore here. 

Latest Singapore Savings Bonds (SSB) offer a 10-year average return of 2.86%

The January issuance of the SSB (SBJAN25 GX25010E) offers a 1-year interest rate of 2.73%, and a 10-year average return of 2.86%. 

This is slightly higher than the 10-year average return of the previous SSB, which was 2.81%. 

The 1-year interest rate of 2.73% is below the best 12-month fixed deposit rate of 2.90% p.a.

However, I would consider the SSB mainly for the opportunity to lock in the yields for a period of up to 10 years.

You can get the latest interest rate projections for the next SSB here. 

What are the other options to earn a higher yield? 

Fixed deposits are seen as relatively safe options to park our cash as our savings will be insured to up to S$100,000 under the Singapore Deposit Insurance. 

At the same time T-bills and Singapore Savings Bonds are relatively low risk investment options as they are issued by the Singapore government. 

I have also seen a lot of discussion in the Beansprout community about other ways to earn a higher yield.

From the way I see it, I would group them into products that claim to offer guaranteed returns and those that do not. 

However, I would highlight that these are not capital guaranteed, even if they were to offer guaranteed returns. 

#1 - Cash Management Accounts that offer more liquidity 

Cash management accounts aim to provide higher potential returns compared to savings accounts, and greater flexibility compared to fixed deposits.

Some examples of cash management accounts include Moomoo Cash Plus, Tiger Vault, Webull Moneybull, Endowus Cash Smart, Mari Invest and Phillip Smart Park 

By putting your money in a cash management account, you will be investing in money market funds or bond funds. 

These professionally managed funds will put your cash in instruments such as bank deposits or short-term debt to earn higher interest rates.

The indicative 7-day annualised yield of the Fullerton SGD Cash Fund was about 3.03% as of 12 December 2024. 

However, it is worth pointing out that these funds are not capital guaranteed, and funds in cash management accounts are not insured under Singapore Deposit Insurance Corporation Limited (SDIC).

There are several ongoing promotions for investments in Singapore dollar money market funds. 

• Tiger Brokers is offering a interest bonus coupon that allows you to earn 6.8% p.a. with Tiger Vault. Learn more about the Tiger Vault promotion here.
• Moomoo Singapore is offering a interest booster of up to 2.1% p.a. on top of your usual Cash Plus yield for 30 days.  Learn more about the Moomoo Cash Plus promotion here.

#2 – Cash Management Accounts with guaranteed returns

Firstly, a few of the robo-advisors have introduced cash management solutions that offer guaranteed returns. 

They generate the returns by investing your funds into fixed deposits products provided by banks in Singapore.

For example, Syfe Cash+ Guaranteed is the cash management solution offered by Syfe which offers investors guaranteed returns for their idle cash. 

Syfe Cash+ Guaranteed offers a guaranteed return of 3.05% per annum for a term of 3 months as of 13 December 2024. 

StashAway Simple Guaranteed also offers a guaranteed return on your investments, with a 3-month guaranteed rate at 3.0% as of 13 December 2024. 

 #3 – US dollar denominated options to park your cash 

If you have idle cash denominated in US dollars, you can also consider the following options to earn a higher yield compared to the T-bill.

However, if you are converting from SGD to USD,  you should be aware of the foreign currency exchange risks. This is because the US dollar could weaken against the Singapore dollar. 

USD Fixed Deposits

• The best 3-month US Dollar fixed deposit rate is 4.75% p.a. offered by SBI.
• The best 6-month US Dollar fixed deposit rate is 4.35% p.a. offered by the Bank of China.
• The best 12-month US Dollar fixed deposit rate is 4.00% p.a. offered by the Bank of China.

You can check out the best USD fixed deposit interest rates in Singapore here. 

US Treasuries 

US Treasuries are debt securities issued by the US Department of the Treasury, just like the Singapore T-bills are backed by the Singapore government. 

The US 1-year Treasury yield is at 4.19% as at 10 December 2024, having fallen since US President-Elect Donald Trump's nomination of fund manager Scott Bessent as US Treasury Secretary, which is seen as a force of stability who will pursue more measured policies. 

You can purchase US Treasuries using on either Moomoo Singapore or Tiger Brokers. 

USD Money Market Funds

Some of the cash management accounts also allow us to invest in money market funds denominated in US dollars. 

There are several ongoing promotions for investments in USD money market funds. 

• Tiger Brokers is offering a interest bonus coupon that allows you to earn 6.8% p.a. with Tiger Vault. Learn more about the Tiger Vault promotion here.
• Moomoo Singapore is offering a interest booster of up to 2.1% p.a. on top of your usual Cash Plus yield for 30 days.  Learn more about the Moomoo Cash Plus promotion here.

What to consider when choosing between T-bills vs fixed deposits vs SSB vs money market funds? 

There are 4 questions I would think about when considering these options.

• Am I comfortable with a product that is not be insured by SDIC or backed by the Singapore government?

If I am comfortable in doing so, then I would also consider cash management accounts to earn a higher yield on my cash.

• Will I need the money in short notice? 

If liquidity is of importance as I may need the cash for other uses in short notice, then I may prefer cash management accounts that offer liquidity typically within days. 

• Do I want to lock in the yields for a longer time period?

If I am looking to lock in the current high interest rates for a period of up to 10 years and not have to worry about reinvestment risks, then the Singapore Savings Bonds allow me to do so while having the flexibility to redeem anytime.

• Do I have any use for the cash in US dollars?

If I am looking to invest in US stocks or ETFs or have other uses of US dollars, then I may consider the US dollar denominated fixed deposits, money market funds or Treasuries. 

Otherwise, I may face foreign currency risks when converting the money back into Singapore dollar in future. 

What would Beansprout do? 

As my existing T-bills mature, I may not be re-investing all my proceeds in subsequent auctions.

After all, it is still possible to find options to earn a yield that is close to or above 3% p.a., above the cut-off yield for the latest auction.

If I have more than S$100,000 of cash, I would be able to get an interest rate of 3.2% p.a. with the best fixed deposit rate in Singapore.

If I am looking to park smaller amounts, some of the best savings accounts in Singapore also offer an interest rate of close to 3.2% p.a. without having to jump through hoops.

For more liquidity compared to the T-bill,  I would also consider money market funds to park some of my money. 

Lastly, I would also park some money into the latest Singapore Savings Bonds (SSB) to lock in the 10-year average interest rate of 2.86%. 

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