Lucky to have Singapore Savings Bonds.

Stock market is crashing.

Bond market is crashing.

Crypto market is crashing.

Suddenly, everyone is rushing for the exits and looking for safe harbors to park their money.

So, quickly now, withdraw all our money and stack them up at home (and pray that there are no termites.)

Alamak, I believe in keeping some cash at home for convenience but this is too much lah.

Of course, jokes aside, all of us know about the risk free and volatility free CPF we lucky Singaporeans have.

What about risk free and volatility free Singapore Savings Bonds or SSBs?

Well, long time readers of my blog might remember that I blogged about SSBs donkey years ago.

However, I hardly talk about them compared to how much I talk about the CPF.

I am blogging about the SSB now because many readers left comments about the SSBs in my blog and even my YouTube channel in recent days.

Whether something is good for us or not will depend on what we need and how well it fits that need.

The SSB is designed as another way for risk averse people to save money (up to a maximum of $200K at any one time) for the medium term.

We can tell this is the case because to get the maximum coupon, we have to hold the SSB for the full 10 years.

If our motivation is not to save money for the medium term, then, we have to accept the possibility of receiving smaller coupons if we should make premature redemptions.

The SSB is also safe because there is no penalty for premature redemption although there is a waiting time before we can get our money back.

So, it isn't the nearest of money which means it isn't the best way to store our emergency fund.

An easy solution is to park only a portion of our emergency fund in a SSB if we really want to use it that way.

This might not work if someone has a relatively small emergency fund in which case I think leaving the money in a fixed deposit might be a better idea.

I blogged about this way back in 2015 and if you are interested in what I said back then, read:

Singapore Savings Bonds: Good?

Now, having said this, with interest rates rising, if the SSB should offer an average coupon of 4% eventually, it might be a no brainer to park some money in SSBs for the full 10 years as it would mimic the CPF-SA.

It really is not easy to get a consistent 4% risk free and volatility free return especially in a strong currency like the Singapore Dollar.

It is utter mayhem in some markets and things could get worse before they get better.

Who knows?

Things could even get worse for longer if we get stagflation.

Still, as long as we are financially prudent, have a large enough emergency fund and are invested in bona fide income producing assets so that we receive passive income to cover a good portion of our expenses, we should do better than most. 

The aim is to be always prepared for winters.

I do not doubt that other than those who are super rich, most of us would have to make adjustments in the event of a longer winter even so.

Be pragmatic.

If AK can do it, so can you!

Recently published:

1. Buy Bitcoin at long term support.
2. Reallocate as interest rate rises...

Relevant video from AK's YouTube channel:

Buying Bitcoin at long term support.

On 5 May 22, I published a blog on why I was looking to add Bitcoin to my portfolio.

The plan was to have gold, silver and Bitcoin form 4% to 5% of my portfolio as insurance against fiat currencies.

This decision was made after plenty of thinking and research.

Of course, there are plenty of cryptocurrencies available but I am only interested in Bitcoin because of the "Bitcoin is digital gold" line of thought.

I have no interest in the "Buy cryptos to get rich quick" line of thought which has a strong speculative flavor to it.

When something gains traction and greater mainstream acceptance, often, we see variants of it spawning as everyone tries to get a piece of the action.

It is no different in the crypto space and very recently, the crypto space had their version of Blumont/Asiasons crash.

Seeing is believing:

Luna has crashed.

Crash is probably an understatement as this Luna crash puts the craters on the Moon to shame.

Many who placed heavy bets on Luna lost everything.

Terrible.

What about Bitcoin?

Well, it is crashing too but not in such a dramatic fashion.

I only got my little toe in the Bitcoin door a couple of weeks ago.

Why not a foot? 

I initiated a very small position because I saw a bear flag in the chart.

The suggestion was that price could go a bit higher and then it could swing lower and I would accumulate only at a lower price.

So, with the price crashing now, when would I be buying more Bitcoin?

Using simple moving averages to throw some light on that matter, the 200 days moving average seems like the one to watch.

Chart dated 12 May 22.

This 200 days moving average is still rising and approaching US$22,000.

Just quick and dirty technical analysis.

Of course, technical analysis shows where the supports and resistance are but it doesn't tell us if they would be tested.

Will just have to wait and see.

Recently published:
Reallocate as interest rate rises...

Related post:
Gold, silver and Bitcoin.