Up to now, I’ve utilized for T-bills largely with money, utilizing largely cash from maturing mounted deposits.
As increasingly more cash acquired locked up in T-bills in addition to contemporary mounted deposits with greater 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 taking part in truant at dwelling which I rapidly put to work in T-bills in February.
Sadly, except I had a cash tree at dwelling, it might be inconceivable to seek out more cash taking part in truant at dwelling.
I nonetheless need to proceed getting T-bills as a way to keep a significant publicity to mounted revenue particularly throughout this era of a lot greater yields.
After all, till a couple 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 engaging yields whereas having an annuity angle.
So, though it’d appear to be I’ve not too long ago developed a fascination for mounted revenue, I actually have not.
It has at all times been an necessary 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 will purchase T-bills utilizing cash in these accounts.
My SRS account not too long ago acquired a leg up as I offered my funding in SATS, reserving a modest capital acquire within the course of.
My CPF-OA nonetheless has some $52K out there for professionally managed merchandise.
I’ll break up the $18K out there in my SRS account into 3 equal elements and apply for the three T-bills on supply within the month of March.
These could be non-competitive bids as I believe 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 stated to my bowling ball, “You win liao lor!”
The $52K out there for funding in my CPF-OA, I’ll make a aggressive bid for the T-bill closing on 1 March.
I’m bidding very near a 4% p.a. yield this spherical as I see inflation knowledge coming in sturdy and likewise a strengthening US$ towards the S$.
As the appliance is being made on-line, the fee actually is not that top like earlier than.
On-line software saves me a visit to the financial institution and, fairly probably, a very long time in a queue.
It is extremely lucky that DBS has made on-line software for T-bills utilizing CPF-OA cash out there.
If profitable, I might lose solely a month’s value of curiosity revenue (i.e. for the month of March) from CPF-OA because the T-bill will mature in early September.
This is able to 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 might not lose one other month’s value of curiosity revenue for the month of September.
That is in contrast to 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 mounted deposits positioned utilizing CPF-OA cash.
The cut-off yield for that T-bill was 3.87% p.a. which wasn’t a foul 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 might lose 2 months’ value of CPF-OA curiosity revenue 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 leap to the conclusion that that is all that we’ve got to do to realize a major stage of economic safety and, finally, monetary freedom.
For the overwhelming majority of us, mounted revenue alone isn’t going to get us to monetary freedom.
If you happen to want structured steerage on methods to be a profitable investor for revenue, there’s at all times Dividend Machines which closes at 23:59 hours at present.
If you’re , I blogged about Dividend Machines earlier this month right here:
Banks & REITs Dividend Machines.
1. CPF or SSB?
2. Have $10K? Make investments or save?
3. Modifications to portfolio (Feb 23.)