What is SRS?
The Supplementary Retirement Scheme (SRS) is introduced by the Singapore government to support Singaporeans to save for retirement. SRS is complementary to the Central Provident Fund (CPF). Different from the CPF scheme which is mandatory, SRS is voluntary, and SRS participants can contribute a discretionary amount to SRS (subject to a cap). CFP savings are mainly for housing, medical, and other living expenditures, while SRS savings can be used for various investments.
Advantages
- SRS contributions made on or after 1 Jan 2017 are subject to a cap on personal income tax relief of $80,000 per Year of Assessment from Year of Assessment 2018.
- Investment returns are accumulated tax-free and only 50% of the withdrawals from SRS are taxable at retirement.
- Broader investment selections for SRS account.
Withdrawal
- Eligible to withdraw from the SRS account at the statutory retirement age of 62.
- Withdrawal before the statutory age will be subjected to a 5% charge, and the taxable amount of the fund is 100%
- Up to 10 years to withdraw the full amount without any penalties except in certain exceptional circumstances.
More information about SRS, please visit:
Inland Revenue Authority of Singapore, SRS
SRS savings to invest in ETFs
SRS account is eligible to invest in more than 50 SGX-listed ETFs which expose to a variety of asset classes, namely equities, fixed-income, REITs, commodities, and money market. These ETFs are suitable for a long-term investment horizon and provide diversified portfolios with exposures to certain sectors or themes.
ETF Recommendation
|
Fund Name (Ticker) |
LION-OCBC Securities Hang Seng TECH ETF (HST SP) |
|
Description |
The investment objective of the Fund is to replicate as closely as possible, before expenses, the performance of the Hang Seng TECH Index using a direct investment policy of investing in all, or substantially all, of the underlying Index Securities. The Index is compiled and calculated by Hang Seng Indexes Company Limited and is designed to represent the 30 largest technology companies listed in Hong Kong which have high business exposure to technology themes. |
|
Asset Class |
Equity |
|
30-Day Average Volume (as of 24 Nov) |
9,413,040 |
|
Net Assets of Fund (as of 24 Nov) |
1,606,280,360 |
|
P/B Ratio (as of 24 Nov) |
2.04 |
|
Management Fees |
0.45% per annum |
- In the long term, tech is still the growth leader of our economy.
- Currently, the tech sector is undervalued.
- Index is reviewed quarterly to ensure the companies meet the index criteria.
- China will reopen in the future, supporting the growth of the tech industry.
|
Fund Name (Ticker) |
LION-PHILLIP S-REIT ETF (SREITS SP) |
|
Description |
The investment objective of the Fund is to replicate as closely as possible, before expenses, the performance of the Morningstar® Singapore REIT Yield Focus Index℠ using a direct investment policy of investing in all, or substantially all, of the underlying Index Securities. The Index is compiled and calculated by Morningstar Research Pte. Ltd. and is designed to screen for high-yielding REITs with superior quality and financial health. |
|
Asset Class |
Equity |
|
30-Day Average Volume (as of 24 Nov) |
546,764 |
|
Net Assets of Fund (as of 24 Nov) |
292,569,546 |
|
P/B Ratio (as of 24 Nov) |
0.896 |
|
Management Fees |
0.50% per annum |
- Benefit from investments with both equities and fixed-income features.
- Regular income stream through the collection of dividends when various REITs payout.
- Exposure to income-producing real estate market in Singapore and regional countries.
- Low cost to invest in multiple REITs.