Hi all! We are probably a bit late but Happy New Year to everyone!
As mentioned in the last update 2 weeks ago, Mrs Budget and I have been busy with our wedding and now that it is over, we are back with our regular publishing schedule.
A few key things in the financial space happened over the past 2 weeks, and we wanted to share our thoughts on them.
Firstly, the change in the DBS Multiplier account. Many other financial bloggers have shared about the changes, but basically the most important changes are that your dividend no longer counts as the ‘investment’ category and if you only fulfill one category of the required spending, the interest is only applicable up to S$25,000.
I guess too many people have been abusing the bond ladder method to get monthly dividends when the account was announced, and now DBS finds that the interest rate is not too sustainable.
We previously shared that our individual main account is the DBS Multiplier account. With the new change in the DBS Multiplier account, if I were to continue enjoying the current rate, what I will need to do is to ensure that I have monthly trades, or I start a regular savings plan.
To be honest, that’s a bit too much trouble for me. As much as I want to support DBS which I am holding some shares in, what I will be doing is to swap my main savings account to my UOB One account and will try to hit the 3.88% interest rate. Of course, I will need to make sure that I have more than S$60,000 in the UOB One account for the switch to make sense.
Perhaps I should be picking up UOB shares soon too! 🙂
In terms of portfolio, both Mrs Budget and I did not make any trades last few weeks, and we will be waiting for any opportunities to deploy our capital as and when they come by. Nothing particularly stood out for us at this point but we will be sharing them if any trade happens.
We will be sharing our wedding related expenses in the next update so do keep a look out for that!
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Mr And Mrs Budget 
Firstly, wishing you and Mrs budget a happy new year. Thank you for sharing your personal finance lives with us! I wanted to seek your opinion on which joint account you would recommend for soon-to-wed-and-BTO couples. Currently I hold a personal OCBC 360 account and he holds a personal UOB account. However, as the wedding and BTO arrives end of this year, we are looking to finally merge part of our savings and expenses in a single account. Thanks for your time!
On Wed, 8 Jan 2020 at 3:49 PM, Mr And Mrs Budget wrote:
> Mr Budget posted: ” Hi all! We are probably a bit late but Happy New Year > to everyone! As mentioned in the last update 2 weeks ago, Mrs Budget and I > have been busy with our wedding and now that it is over, we are back with > our regular publishing schedule. A few key th” >
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Hi Awfullygreen!
Thanks for dropping by!
It’s a bit hard to recommend now because it depends on how much both of you want to put in the joint account. For Mrs Budget and I, we adopt a “claims” system where we both contribute a monthly $1000 into the joint account, and for every expenses we incur for the household, we will claim from the joint account. So our joint account is not really for our retirement planning, but for goal based savings (eg reno, housing, wedding, kids fund etc) and will also end up being depleted. So to be honest, since our joint account balance will mostly be low, the difference in bank interest rate between bank 1 and bank 2 is negligible. The nature of our joint account is cash outflow and not cash accumulation, hence the bank interest rate will not make much difference to us.
So for us, the UOB One account is a really attractive choice, which was what Mrs Budget and I use as our joint account. We chose UOB One because we can pair it up with the UOB One card. UOB One account can be a joint account too, so if you have less than S$15,000 in the account, you will enjoy 1.5% interest rate if you spent a min of S$500 on the UOB One card, and 1.85% if you credit your salary + the min $500 spend.
On top of that, the UOB One credit card offers up to 5% cashback which we use for all our major expenses incurred for housing and wedding payment. Its probably the best cash back card to use, hence our credit card strategy played the biggest factor for us in terms of choosing the bank to go for our joint account, instead of the bank w the highest interest rate. 🙂
Hopefully this helps!
– Mr Budget
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Hi MrMrsBudget,
Happy new year to you all! For the change of principal savings account that you have decided, i am not too sure about the trouble of taking up a RSP plan (i.e. 1.2k for a period of 12 months). It seems to be that changing to UOB requires more trouble now as you need to setup GIRO and maintain a minimum spending on credit card. Isn’t setting up a RSP plan online an easier option? Also, you could simply take up a cancerCare or decreasing mortgage insurance (costing ard 11-20 per month) to trigger the higher CAP of higher interest (to 100k).
Would be happy to understand what do you really mean by trouble and how do you measure the decision?
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Hi Curiousmoo!
Thanks for your questions. For us, because we already have UOB One accounts so for me its a matter of shifting the funds over and ensuring that i have more than S$60,000 in my cash balance to enjoy the 3.88% interest rate. For UOB, i just need to ask my company’s HR to credit my salary into the UOB account.
You are right – I can start a RSP plan but Im already starting a new monthly contribution to a roboadvisor. If i sign on a new RSP, i feel like my portfolio will be too messy with too many components (self managed portfolio for us hk my sg equities, alternative investments, robo, bonds). And I am not a fan of a separate RSP plan on top of my monthly roboadvisor contribution. 🙂
Another factor is that, if DBS multiplier can change their terms in just 1 year, who knows if they might change again one year later if they realize that the gains the made from the RSP / insurance is still insufficient to cover the high interest given out? They should have figured all the calculation out before launching the new product 1 year ago – thats what I feel. As a shareholder of the company, I am very happy, but as a customer of the account, not so much.
So I’d rather switch everything over to UOB One and try to see if I can hit the 3.88% interest rate, which seems very very attractive and doable for now. 🙂
Hopefully that helps with my thought process.
– Mr Budget
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