Sunday, January 15, 2017

USD Fixed Deposit Review

I have with me a sum of USD and every 6 months to a year, I have to find a good place to park my USD to get some good returns.

So why does Mrs Spoon have this sum of money? Well, working for an MNC have its perks. MNC typically give away some shares to its employees and I have been saving a few rounds of my bonuses. I cash them out (yes, at a bad price though) and I opted to have the monies in United States Dollar as a hedge for the fledging Singapore economy and currency. It is good news now since USD is trending upwards. I am really unsure of Trump's move though. what is his plan for the US economy? How will interest rates be affected?

So is a comparison of the current FD rates for USD right now:


Bank
Rates (3 Months)
Rates (6 Months)
Rates (12 Months)
Minimum Amount
CIMB

1.77
1.85
20k
Maybank

1.1
-
50k
ANZ
1.18


50k
OCBC
0.65

0.8
5k
UOB
0.05+0.9


50k

So it does seem like CIMB is tops at the moment. 

What other factors do you need to keep in mind? The transfer fees and the agency fees. 

I plan to move some of my USD out from my existing USD current account to the CIMB account. There are two ways which this can be done:

1. TT transfer; or 
2. By cheque. 

TT transfer is quick and fuss-free. Generally, what I would need to do is to go down to CIMB bank to get a placement form with the relevant instructions so that the bank knows what to do when monies hit the account. There is no charge on CIMB's end as the receiving bank, but there is a charge on the transferring bank. I did not manage to contact OCBC but CIMB informed me that if they were the transferring bank, they would charge SGD30 for admin fees, and their agent bank would charge about USD50 for agency fees. 

For cheque, this is not instant, and it takes about 4 working days for the cheque to clear. However, it does seem like this is free on both the transferring bank and the receiving bank. Let me try this out and see how it goes.

Edit: It is not free for cheque from OCBC bank either. There is a 0.125% charge for commission fees and 0.125% charge for commission in lieu of currency exchange fees! However, what is not charged is a $20 TT transfer. So that is what you are saving on. If 4 clearing days makes you more than SGD20 in interest (either the interest rate is so high or the amount is so huge like in the millions), else a cheque is still cheaper. 

Meanwhile, please update me if you have any idea what else i can do with USD. 

Cheers

No comments:

Post a Comment