Is Your Money Working Hard Enough?
Inflation quietly erodes your purchasing power every year.
Are your savings keeping up?
The Silent Thief: Inflation
Every year, the cost of living rises. A bowl of noodles that cost S$3 in 2004 now costs S$5 or more. This gradual increase is inflation, and it affects everything you buy.
Over the past 20 years (2004-2024), Singapore's Consumer Price Index rose by approximately 52%. In other words, S$100 in 2004 would need to be S$152 today just to maintain the same purchasing power.
The question is not whether to invest. The question is whether you can afford not to. Money sitting idle loses value every year.
Why "Safe" Options May Not Be Enough
Many Singaporeans keep their savings in bank accounts, fixed deposits, or Singapore Savings Bonds. These feel safe because the principal is protected.
But "safe" is not the same as "sufficient". Let us look at how these options compare to inflation.
| Option | Current Rate | vs Inflation | Accessibility |
|---|---|---|---|
| Cash Savings Account | 0.05% p.a. | Losing to inflation | Fully liquid |
| Fixed Deposits (12-month) | 1.20% - 1.40% p.a. | Barely keeping pace | Locked for tenure |
| Singapore T-bills (6-month) | 1.41% p.a. | Barely keeping pace | 6-month lock-in |
| Singapore Savings Bonds | 1.33% (Yr 1) / 1.99% (10-yr avg) | Marginal real return | Redeemable monthly |
| CPF-OA | 2.50% p.a. | Modest real return | Restricted use |
| CPF-SA | 4.00% p.a. | Beats inflation | Locked until 55 |
Inflation reference: Singapore's long-term inflation averages 2-2.5% p.a. Current (2025): ~1.2%.
A Note on Singapore Savings Bonds
You may have noticed SSB yields reached above 3% in 2022-2024. This sounds attractive, but context matters.
High SSB yields typically occur when central banks raise interest rates to combat inflation. During that same period (2022), Singapore inflation hit 6.1%. A 3% SSB yield against 6% inflation still means your money lost purchasing power.
Key insight: High SSB yields are a response to inflation, not a hedge against it. By the time you lock in a high rate, inflation has often already eroded your purchasing power. The 3%+ SSB window lasted only about 2 years and is not the historical norm.
The Cost of Not Investing
Let us see what happens to S$100,000 over 20 years at different growth rates.
| Scenario | Growth Rate | After 10 Years | After 20 Years |
|---|---|---|---|
| Cash Savings | 0.05% p.a. | S$100,501 | S$101,005 |
| Fixed Deposit | 1.30% p.a. | S$113,773 | S$129,443 |
| SSB (10-yr avg) | 2.00% p.a. | S$121,899 | S$148,595 |
| CPF-OA | 2.50% p.a. | S$128,008 | S$163,862 |
| Diversified Portfolio | 4.00% p.a. | S$148,024 | S$219,112 |
| Diversified Portfolio | 6.00% p.a. | S$179,085 | S$320,714 |
The difference between leaving S$100,000 in a savings account versus investing it at 6% p.a. over 20 years? Approximately S$220,000. Time and compounding are powerful forces.
What About Risk?
Investing involves risk. Markets go up and down. Your portfolio value will fluctuate. This is a fact, and we do not hide from it.
But consider this: not investing is also a choice with consequences. Inflation risk is real, even if it is less visible than market volatility. The question is which risk you are more comfortable managing.
For investors with a long time horizon (10+ years), history shows that staying invested through market cycles has generally been rewarded. Short-term volatility smooths out over time.
Our portfolios have been backtested through multiple market cycles, including the 2008 Global Financial Crisis, 2020 COVID crash, and 2022 bear market. We show you exactly how each portfolio performed during these periods, so you know what to expect.
Our Portfolios
We offer three model portfolios with 12 to 23 years of backtested performance data, designed for different risk appetites. All are available for Cash, SRS, and CPF-OA investments.
| Portfolio | Risk Level | Track Record | Annualized Return |
|---|---|---|---|
| Conservative | Low | 23+ years | 3.63% p.a. |
| Balanced | Medium | 12+ years | 5.87% p.a. |
| Growth | Higher | 12+ years | 8.69% p.a. |
Ready to Explore Your Options?
View our portfolios to see detailed performance data, or book a consultation to discuss which approach suits your goals.
View Our PortfoliosThis page is for educational purposes only and does not constitute financial advice. All investments carry risk, including the potential loss of principal. Past performance does not guarantee future results.
Rates and figures shown are subject to change. The comparison table reflects rates as of December 2025 and may not reflect current conditions when you read this.
Please consult a qualified financial adviser before making any investment decisions.