Automating the investing process with OCBC BCIP and POSB Invest-Saver

Do you believe in dollar cost averaging or lump sum investment?

Over the past few years, I’m a firm believer on the former. But do I practice what I preach? That’s a whole different story.

The ammunition is there but no bullets were fired

While I’m consistently socking money away in my investment war chest, I found that I’ve not made a single transaction in my online brokerage account at all this year. *The horror!*

It’s not that I don’t have money to invest in my portfolio but the reality is that I’m still a novice when it comes to investing in the stock markets and the number 1 problem with newbies like me is that I keep trying to time the market.

Now this is a flaw that I recognize that I have and unfortunately I just can’t seem to help it! *sad face*

Remove the human and automate the investing process

Because of the issues with the human (me), I decided to automate the investing process and take the human out of the process.

Automated investment is not a new thing in Singapore and 2 major banks, OCBC and DBS have already started offering this for some time now.

In fact, I’ve been using OCBC’s Blue Chip Investment Plan to invest my SRS monies in Nikko AM Singapore STI ETF for the past 2 years.

For my cash investments, I started using the POSB Invest-Saver to make monthly investments into SPDR Straits Times Index ETF Nikko AM Singapore STI ETF and ABF Singapore Bond Index Fund. The process of applying for the Invest-Saver through the POSB iBanking platform was very easy since I already have a savings account with the bank.

Planned automated monthly investments in 2017:

  • Nikko AM Singapore STI ETF (SRS and cash): $1,275 + $500
  • SPDR Straits Times Index ETF (cash): $500
  • ABF Singapore Bond Index Fund (cash): $500

Total automated investment in 2017: $27,300

Update: The comment from K is right. POSB Invest-Saver only invests in Nikko AM Singapore STI ETF and not SPDR Straits Times Index ETF. The article has been updated accordingly

Unfortunately, the monthly cash investment is still very small as bulk of my savings is still going towards funding my Cambodia SOHO property purchase.

Disadvantages of automating the investment process

Just because I’m doing it, doesn’t mean you should too.

If something can save you time, it’s probably going to cost you a little more money than doing it yourself.

I haven’t done the math but it’s very likely that using OCBC’s BCIP and POSB’s Invest-Saver to automate my investing process is most likely going to cost me a bit more than doing it manually on my online brokerage platform.

Weigh the pros and cons before making your decision. In my case, automating my investment process is definitely going to help align my investment portfolio with my investment objectives.

What are your thoughts on automating your investment process?

Leave a Comment:

4 comments
K says December 12, 2016

Hello!

I believe POSB Invest Saver only allows investments into Nikko AM STI? Unless they allow it already?

Regards

Reply
    Mickey J says December 12, 2016

    Thanks for your comment. You are right that POSB Invest-Saver only allows investments into Nikko AM STI and not SPDR Straits Times Index ETF. I’ve updated my article accordingly.

    Reply
Initiatives says December 12, 2016

Hi

Is there any reason why you split your DCA of G3B to both OCBC and POSB?

Isn’t the commission cheaper if you consolidate it to OCBC every monthly?

Unless BCIP doesnt allow mixture of SRS and cash.

Reply
    Mickey J says December 13, 2016

    Thanks for your comment.

    It’s a good point and I’ve never really looked at it this way. Now that I compared the charges, I am effectively paying the same amount of fees for investing $500 cash in G3B through OCBC BCIP ($5 minimum) compared to $500 in Invest-Saver (1% of $500 which is also $5). However, if I increase the amount, then it makes more sense to use OCBC BCIP and I’ll definitely do that when it happens. Thanks for highlighting that.

    Looking at the website, I believe BCIP treats SRS and cash as 2 separate transactions and hence charge the fees separately. I’ll give OCBC a call to find out more and add a new comment later.

    Reply
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