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Having overstayed his welcome as a student, this Eatvestigator was recently ejected by his university. Armed with a pricey piece of papyrus, and having donned a magician cloak with mortar hat, this Eatvestigator must now use his cunning and convince Other People to fund his eating escapades. However, there is only that much Other People’s Money that the Eatvestigator can obtain by turning up regularly on time at some dreadful building in the morning. This is called a day job/active income.
Luckily, this Eatvestigator also works as an Investigator (the kind that does investments, rather than spying on other people’s mistresses) on the sidelines. Putting on his Investigator hat, this Eatvestigator has figured out some financial voodoo to conjure more Other People’s Money into his pockets, so he can buy more food. The key to these financial voodoo is really to make use of financial instruments (bank accounts, credit cards etc) that a) provide high incentives or interests while b) having low fees. Participating in these programs/instruments should ideally not require extra time or additional spending than what the Eatvestigator is already doing. This can be considered as passive income.
1. Bank Account
Thanks to the 2008 Financial Crisis, banks have been forced to keep interest rates near zero (by the Federal Reserve). The Eatvestigator’s POSB savings account earns a paltry 0.05% interest annually. Assuming a $10,000 deposit, the 0.05% interest would yield $5, allowing the Eatvestigator to buy one meal of $5 McDonald’s Filet-O-Fish EVM (Extra Value Meal) in that year. (YES YES, I know, Mcdonald’s is the worse. Example only ok.) What about the other 364 days and 2 meals? We assume that 3 meals are needed a day.
The Investigator discovered the OCBC360 account which offers a generous 3.05% interest. With the same $10,000, the account would yield $305 in a year, providing 61 McDonald’s EVMs. That is an impressive 61 times better than the POSB account, allowing the Eatvestigator to worry about 20 lesser days of food. The catch to the 3% interest lies in 3 conditions, which earns The Investigator 1% each:
- Salary Crediting of At Least $2000 Monthly
- Pay 3 Distinct Bills Monthly
- Spend At Least $400 Monthly via OCBC Credit Card
Even if the Eatvestigator did not meet all 3 conditions, but only just 1, the 1.05% of interest is still superior to the normal peasant rate of 0.05%. The only downside of the 360 is that the interest rate only applies up to the first $50,000 balances. However if the Investigator did have this much cash, he would have invested it in stocks to get better returns than 3.05%.
2. Credit Card
The last condition of the 360 account compelled the Investigator to look into an OCBC card. Two candidates turned up, the 365 and the FRANK credit cards. Both are cash rebate cards and do not require the Investigator to accumulate silly points for redemption. The marketing folks seem intent on positioning the 360 Account and 365 card as complementary products. Which to choose depends on the usage:
Both cards require meeting a monthly minimum spend amount before the Investigator can obtain the rebates. At the same time, the Investigator can also meet the 2nd condition ($400 monthly minimum spending) of the 360 account.
The 365 provides excellent an excellent 6% rebate for weekend dining. The $600 minimum monthly spend is steep. But if the Eatvestigator was taking up the bill for meals with a big group (and collecting cash afterwards), he can quite easily meet this. This would be the Eatvestigator’s choice card.
On the other hand, the FRANK provides 6% rebates for online purchases and NETS Flashpay top-ups, which can be used for public transport. Increasingly, besides supermarkets, more places are accepting NETS Flashpay (e.g. McDonalds, Old Chang Kee). The Investigator is also able to pay his Singtel mobile bill online to get a 6% rebate on it too. Even better if the Investigator travels regularly on company expense, and needs to buy plane tickets online with his own card. Not only can he claim the plane ticket expense, he can also keep the 6% rebate on it. Therefore the FRANK is hands down the Investigator’s choice due to its superior rebate in a wider variety of usage by the Investigator and lower minimum monthly spend.
Both are excellent cards in their domains. However since the Investigator instigated this post, he finds the FRANK to be the better of the two.
Back to you Eatvestigator.