Update: Since we posted this review, Standard Chartered have updated their Jumpstart Account’s interest rates to be at 1.0% per annum for the first $20,000 from 1st July 2020, and 0.10% per annum for any incremental balance above that. With this new update in mind, CIMB’s Fastsaver and SC’s Jumpstart Account are actually comparable in terms of interest rates, and this may even give Fastsaver Account the edge especially for those with a larger of savings due to the step up nature.
Hello everyone,
Today is the last day of the circuit breaker, I hope everyone is doing fine. Lots of my friends have been asking me on how to start investing. But I believe that before that, we need to have a rather reasonable yielding savings account in order to put our warchest (liquid cash) in. The mere 0.05% on standard savings account is not able to beat the inflation rates...
When choosing which account to open, it is important to first know what we want out of the account. For instance, I have 3 accounts, 2 for savings and 1 for spending. Hence, I do not really look for any high interest rate on my spending account as the amount in the account is rather little, just enough to cover my monthly expenses.
As a student, I think the main feature to look out for when selecting a good savings account (besides the interest rate) is that there needs little to no conditions for me to meet to enjoy the interest rates (vs. DBS multiplier, OCBC 360)
With that, I like to share a little about the 2 accounts I use for savings:
Standard Chartered Jumpstart Account
Pros:
This account is a relatively new product in the market. Firstly, SCB promises
2% interest rate per annum, for your savings
up to $20,000 (0.10% p.a. on any incremental balances). This interest rate is much better than the ones offered by other savings accounts, and could be a great place for youths to park our savings.
Besides that, SCB’s Jumpstart also comes with a debit card, that allows for 1% per annum cashback (capped at $60 per month per account) on eligible card spends, that can help you to further your savings!
Lastly, from personal experience, the process of opening an account was relatively smooth and fast. There are also no fees and minimum deposit required in starting an account.
Cons:
However, there are some restrictions to consider when opening this account as well. Right off the bat, this account is only eligible for youths aged between 18-26 years old, so you would have to look elsewhere if you don’t fall under this age range.
Next, the lucrative 2% per annum interest rate offered by the Jumpstart account only applies to the first $20,000 of your deposit, and only 0.10% p.a. on any incremental balances. If you are looking for a bank to park more than $20,000 worth of savings, you might have to either look elsewhere or look to use a combination of different savings account.
CIMB Fastsaver Account
Pros:
Prior to the Jumpstart Account, this was my main savings account as it gave one of the highest returns for youths then. It offers
1% p.a for the first $50,000, 1.5% p.a for the next $25,000, 1.8% p.a for your next $25,000, and finally 0.6% for anything above $100,000. While it may not come across as attractive as Jumpstart Account’s interest rates, it actually allows for a better interest rate for amounts over $20,000, so it may be a worthwhile look for some. Anybody over the age of 16 is eligible to open this account.
Cons:
However, there are also several limitations to opening a Fastsaver account that one needs to consider. Firstly, there is a minimum of $1000 of initial deposit one needs to make when opening the account, which may not be an amount that some of us have right now.
Also, another restriction some might consider would be that there is no ATM card given with this account, and one would need to pay $10 to get an ATM card. Personally, I feel that this is not much of an issue as CIMB does not have many ATMs around Singapore to begin with. Also, this was meant to be a savings account and hence there shouldn’t be much withdrawals being made anyways! Furthermore, if there is a need for you to withdraw this money, both SC’s Jumpstart and CIMB’s Fastsaver allows for FAST transfer, which enables you to transfer money away to your other bank accounts relatively quickly (usually this can work in less than 5 minutes for me).
Which is the best account?
The comparison between the two saving accounts should come across as a no-brainer at first sight - 2% for SC’s Jumpstart Account.
However, there are certain scenarios where CIMB’s Fastsaver account can be better as well. Firstly, if you are only 16 years old, you will be ineligible for SC’s Jumpstart Account. In this scenario, CIMB’s Fastsaver Account could be a good place for you to park your money before you turn 18, the minimum age required to open the Jumpstart account.
Secondly, if you are looking for a savings account to stash away a large sum of money, then SC’s Jumpstart Account may not be suitable for you as the lucrative 2% p.a. interest only applies to the first $20,000 you deposit into the account.
Both account openings can also be done quickly online without the need to go down physically to the branches. I have been using the Fastsaver account for a few years and have no complaints about it, perhaps other than the rather outdated mobile banking app it has...
We also recently created the Singlife account and is currently in the midst of exploring it, we will share a little more about it soon.
Stay safe and healthy,
T
