SSB 3.32% p.a.: Higher for longer!

When I blogged about last month's SSB which offered 3.16% p.a. 10 year average yield, I said I would probably be buying some.

And I did.

Just a modest sum of money as I was "borrowing" the money from 2025.

It was money which I would otherwise have earmarked for voluntary contribution to my CPF account in 2025.

2025 would be the year I turn 54 years of age.

Now, I see this month's SSB offering 3.32% p.a.

What am I doing?

I will be buying again, I suppose.

Again, it would be a modest sum of money.

Although I am sticking to my strategy of growing the investment grade bond component of my investment portfolio, there might no longer be a hurry to lock in higher yields for the longer term now.

I recently produced two YouTube videos on the likelihood of interest rates staying higher for longer.

This is the current day narrative and it seems to have gained traction.

This is probably why the last T-bill auction surprised us with a cut-off yield of 4.07% p.a. too.

Much higher than many expected.

If you have not watched the YouTube videos yet, here are the links:

1. This could be BAD! Why look at bond yields?

2. Reason why it could be a lot WORSE!

The yield curve is still very inverted with the shorter durations being more rewarding.

So, strengthening my T-bill ladder would be more rewarding.

Still, reinvestment risk exists with the T-bill ladder.

I tell myself not to complicate things and simply stick to my plan.

1. Maintain and strengthen T-bill ladder for another source of recurring income.

2. T-bill ladder can be dismantled gradually to buy stocks during a recession.

3. Buy SSBs with money meant for VCs to the CPF as long as SSBs' 10 year average yield is higher than 3% p.a.

There is no way I am going to make all the money in the world.

If AK can talk to himself, so can you!

"Don't sacrifice your own retirement and financial health!"

I produced a YouTube video recently on how much money do seniors need in Singapore monthly to cover basic needs.

The video got many comments and some of them were pretty shocking when it comes to providing financial support for parents.

I am archiving some of these in my blog as a reminder to myself that not everybody thinks like me and how things might be very different now.

@deschua76 said,

30 years ago when I was still a kid, I told my parents that I won’t give them a single cent when they retired and because of that the fear drove them to become financially free now! 

That should be the way! Do or die! No excuses!!!! my parents constantly thank me for what I did. For your information and dissemination please.. #ToughLove 

And someone agreed with this comment. 

 @user-pi6mn9wj8n said, 

This is what ALL children should tell their parents. Why shld children hv to pay parents who hv no responsibility to take care their own financial health. 

The young hv it far harder than their parents did - with things like student debt and much higher housing costs. 

It is PARENTS that should be helping children at this juncture. DONT sacrifice your own retirement and financial health because u hv deadbeat parents who want/need handouts. 

To this, AK said, 

"Like that, children become forever liabilities.😱 Better don't have children."

In case you are interested in that YouTube video and the comments it generated, here is the link:

How much money do seniors need in Singapore in 2023?

Gurmit Singh's song is in my head now. 

"Things different already."