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Thinking about buying bonds in Singapore but trying to figure out where to start?
You’re in the right place!
Bonds can be a stable, lower-risk way to grow your wealth, yet many investors hesitate simply because the process feels daunting.
In this post, you’ll learn:
- How to buy government bonds in Singapore, including SGS, SSBs, and T-bills
- The ins and outs of purchasing corporate bonds
- Tips on setting up and funding your brokerage account
Ready to learn how to get started?
Read on – your future self might thank you for it!
How to buy government bonds in Singapore
Singapore Government Securities (SGS) Bonds
SGS bonds are traditional government bonds, issued with longer terms (usually between 2 to 50 years).
They’re a safe option as they’re backed by the Singapore government, known for its high credit rating.
SGS bonds pay fixed interest every 6 months, which can be appealing if you’re after a steady income stream.
You can purchase SGS bonds through local banks like DBS, OCBC, or UOB, either by visiting the bank in person or through internet banking.
You’ll need a Central Depository (CDP) account since that’s where your bond holdings will be kept.
For detailed steps, you can check out our complete guide on buying SGS bonds to get a thorough understanding of how it works.
Singapore Savings Bonds (SSB)
Singapore Savings Bonds (SSBs) are very popular, especially among beginners, as they offer flexibility and low risk.
SSBs let you invest small amounts, starting from $500, with a unique step-up interest rate structure.
This means the longer you hold onto them, the more you earn.
And the best part? You can redeem them early without losing the interest you’ve already accrued.
To buy SSBs, you can apply online through internet banking with DBS, OCBC, or UOB, or even by using ATMs.
Like with SGS bonds, you’ll need a CDP account.
We’ve got a separate post covering all the details on buying SSBs, so be sure to read it.
Treasury Bills (T-bills)
Treasury Bills, or T-bills, differ slightly from SGS bonds and SSBs.
They’re short-term investments, usually with durations of 6 months or 1 year.
T-bills don’t pay interest like other bonds. Instead, they’re sold at a discount.
You’ll buy them for less than their face value, and when they mature, you get the full face value back – that difference is your profit.
The process is similar to that of other government bonds.
You can apply through any of the major local banks, and again, you’ll need a CDP account.
For an in-depth guide on purchasing T-bills, check out our full article – it’ll cover everything you need to know.
How to buy corporate bonds in Singapore?
Step 1: Decide between individual bonds, bond ETFs, or unit trust funds
Individual corporate bonds on SGX
One way to invest in corporate bonds is by purchasing them directly on the Singapore Exchange (SGX).
Some companies issue retail bonds, which are designed for individual investors and trade just like stocks.
Buying individual corporate bonds allows you to invest in specific companies, so if you’re confident in a particular business’s financial health and want a direct stake in its debt, this might be the route for you.
Simply log into your brokerage account, search for the bond you’re interested in, and place your order.
Keep in mind that you’ll need a CDP account, as all your investments on SGX, including bonds, are stored there.
Bond ETFs
If you prefer a diversified approach, bond ETFs might be a better fit.
Bond ETFs pool together a variety of bonds, including both corporate and government bonds, giving you a broader exposure without having to buy each bond individually.
These ETFs trade on SGX, so you can buy and sell them as quickly as you would with stocks.
Look up the bond ETF ticker on your brokerage platform, review the holdings, and make sure the bonds in the ETF align with your investment goals.
Then, simply buy shares of the ETF like you would any stock.
Unit trust funds
With unit trusts, your money is pooled with other investors’ funds and professionally managed by a fund manager.
These funds invest in various bonds, including corporate ones, and provide diversification without the need for active management on your part.
Unit trusts are suitable if you want a hands-off investment approach while benefiting from a diversified bond portfolio.
Fund managers decide which bonds to buy and sell, based on research and market trends, which can be advantageous for those looking for guidance in their investments.
To invest in a unit trust, you can go through banks or financial institutions that offer a range of funds.
The minimum investment amounts and fees vary, so check each fund’s specifics before committing.
Our financial advisors can also assist you in investing in bond funds – if you need a little bit more guidance.
Step 2: Sign up for a brokerage account
If you prefer to work with a familiar local name, many banks offer brokerage services tailored to bond investors.
DBS Vickers, OCBC Securities, and UOB Kay Hian are popular choices that provide easy access to both Singapore-listed bonds and a range of other investment products.
These brokers have a straightforward process for retail investors looking to buy corporate bonds on the SGX.
Alternatively, consider online brokerages like moomoo.
These platforms offer competitive fees and often come with intuitive trading apps that make it easy to track and trade bonds, stocks, and ETFs from your phone.
Many online brokers also provide access to international markets if you want to diversify beyond Singapore-listed bonds.
Step 3: Fund your brokerage account & buy!
Most brokerages in Singapore allow you to fund your account through convenient methods:
- Direct bank transfers: This is a simple and popular choice. Transfer funds from your bank account to your brokerage account directly through your banking app or internet banking platform.
- GIRO: You can set up GIRO payments for regular funding. This is helpful if you’re planning to invest a fixed amount in bonds regularly.
- PayNow: Many brokerages also accept funding through PayNow, making it as easy as scanning a QR code or entering your brokerage’s PayNow ID to transfer funds instantly.
Conclusion
Investing in bonds in Singapore doesn’t have to be complicated.
By understanding the basics, you’re already well on your way.
We’ve covered the essentials of buying government bonds like SGS, SSBs, and T-bills, as well as corporate bonds and how to access them via individual bonds, ETFs, or unit trusts.
From setting up a brokerage account to funding it and finally making a purchase, these steps make it easy to start.
If you’re unsure or have questions about the best bond options for your goals, don’t worry – you’re not alone.
Sometimes, speaking with an expert makes all the difference.
Feel free to connect with one of our trusted financial advisor partners for a no-obligation chat.
They’re here to help you navigate the bond market with confidence.
