Bonds, T-bills, SSBs and fixed deposits

Read any bond, bill or deposit, bid in a T-bill auction, use SSBs well and build a ladder for a dated goal.

Safe money still needs decisions. Should the down payment fund sit in a fixed deposit, an SSB or rolling T-bills? Why did a bond fund lose money in a year when nothing defaulted? What does a non-competitive bid actually do? Most people pick whatever their bank suggests and hope the rate holds. This course explains how each instrument works, from bond pricing and duration to the MAS auction and SSB redemptions, so you can match each pot of money to the right place. It ends with a ladder built around a real expense you have coming up.

What you'll be able to do

• Write out the full payment schedule of any bond, bill, SSB or fixed deposit from its terms
• Price a bond at different yields in a spreadsheet and estimate its interest rate risk with duration
• Apply for and redeem SSBs, and decide when switching issues is worth it
• Plan a T-bill application, choosing the bid type and funding source with reasons
• Compare fixed deposit promotions with SSBs and T-bills on one like-for-like sheet
• Run a credit checklist on a corporate bond or perpetual before buying
• Build a dated ladder that has the money for a known expense ready on time

Syllabus

Module 1: Know exactly what you lend when you buy a bond

Read any bond, bill or deposit as a loan with a face value, an interest rate and an end date, and write out every payment it will make before you buy.

• 1.1 A bond is a loan with a fixed timetable
• 1.2 Coupon, current yield and what you actually earn
• 1.3 Who borrows: governments, banks and companies
• 1.4 Read a bond's terms and fill in its cash flow table

Module 2: See why bond prices fall when rates rise

Work out what a bond is worth when market yields change, explain why price and yield move in opposite directions, and use duration to estimate how much a price could fall.

• 2.1 Price and yield move in opposite directions
• 2.2 Yield to maturity in plain words
• 2.3 Duration: how far a price moves when rates move
• 2.4 Reprice a bond in a spreadsheet

Module 3: Use SSBs as a flexible pot for safe money

Explain how Singapore Savings Bonds pay step-up interest, apply for and redeem them, and decide whether an SSB suits money you might need within a few years.

• 3.1 How SSB step-up interest works
• 3.2 Applying for an SSB and the limits that apply
• 3.3 Getting your money back early, and what it costs you
• 3.4 Decide whether an SSB fits your safe money

Module 4: Bid for T-bills and SGS bonds without guessing

Understand how MAS auctions T-bills and SGS bonds, choose between a competitive and a non-competitive bid, and plan an application using cash, SRS or CPF.

• 4.1 A T-bill pays its interest up front as a discount
• 4.2 How the auction sets one yield for everyone
• 4.3 Competitive or non-competitive: which bid to place
• 4.4 Paying with cash, SRS or CPF, and what each really costs
• 4.5 SGS bonds for money with a longer horizon
• 4.6 Plan one T-bill application from start to finish

Module 5: Get the most from fixed deposits

Compare fixed deposit offers on what they actually pay, read the conditions behind promotional rates, and know what happens if you need the money before the term ends.

• 5.1 How a fixed deposit works and what protects it
• 5.2 Reading the small print on promotional rates
• 5.3 Breaking a deposit early
• 5.4 Compare four offers on one sheet

Module 6: Judge credit risk before you lend to a company

Understand what can go wrong when a company borrows from you, read credit ratings and bond terms with care, and know why some retail bond products carry more risk than their name suggests.

• 6.1 What happens when a borrower cannot pay
• 6.2 Credit ratings: useful, late and not a guarantee
• 6.3 Corporate bonds, retail bonds and perpetual securities
• 6.4 Run a credit checklist on one bond

Module 7: Choose between bond funds and holding bonds yourself

Understand how a bond fund or bond ETF behaves differently from a single bond, compare funds on duration, credit, currency and cost, and decide which route suits each goal.

• 7.1 A bond fund never matures, and that changes everything
• 7.2 Comparing bond ETFs: duration, credit, currency and cost
• 7.3 When owning the bond beats owning the fund
• 7.4 Match each pot of safe money to an instrument

Module 8: Build a ladder for a known future expense

Plan and build a ladder of deposits, bills and bonds so that money for a dated goal, such as a home down payment or a wedding, is there in full on the day you need it.

• 8.1 What a ladder is and the problem it solves
• 8.2 Match rungs to the dates you need money
• 8.3 Running the ladder as rungs mature
• 8.4 Build a ladder for one real goal

Frequently asked questions

How long does the course take?

About eight hours across eight modules, including the spreadsheet exercises. Most people finish in three to four weeks at two to three hours a week.

Will you tell me which bond or deposit to buy?

No. The course is education and does not replace financial advice. It teaches how each product works and how to compare them, and you make the choice. For advice on your own situation, speak to a licensed financial adviser.

Do I need to know about interest rates and the economy first?

You need to be comfortable with interest rates and simple spreadsheet formulas, which How money works: banks, interest, inflation and risk covers. Why rates rise and fall is taught in How the economy hits your wallet: rates, inflation and cycles.

Why does the course not quote current SSB and T-bill rates?

Because they change every month and would be out of date by the time you read them. Each lesson shows you where MAS, SDIC and the banks publish the current figures, and the exercises have you check them yourself.

Explore more

• All Academy courses