Optimising Gains from Bond Investments for Housewives

Being a housewife, especially during the pandemic, requires a careful planning. Especially in terms of managing the household budget to keep a stable balance. But that doesn't mean you have to cut your budget for investment.

Despite the pandemic, you still have to set aside some fund for investment. Stay careful and wise in choosing investment instruments. If you choose the wrong one, you may increase the risk on your family financial planning.

The key to maintain family finances is being smart in choosing investment instruments. Especially during the pandemic and the new normal routine, as a housewife gains various new tasks and routines that take up a lot of your time. Therefore, a safe and minimal risk investment option such as bond investment is very suitable for housewives.

Bond Investment: Definition, benefits, and important notes

Bonds are debt securities issued by a company or government, included in the medium-term investment as they mature in about 2-3 years. In addition, bond investment is now increasingly popular among investors as it offers guaranteed return on capital as protected by the law, and has a relatively higher interest rate compared to savings and time deposits in conventional banking.

When you decide to buy bonds, it can also mean that you provide a loan in a certain amount to a company or government that issues the bonds. Due to the nature of the loan, the company or the government is required to return the funds along with interest at a predetermined maturity date.

To be able to benefit from Bond investment, here are some things to consider:

1. Choose from bond investment options

   Currently, there are many Bond investment options that you can choose from. That way, as a housewife, you can set aside some fund to invest in Retail Bonds. You can buy Bonds in the Primary Market at the time of the initial offering or IPO, or buy them through the Secondary Market.

   There are several types of bonds based on the issuer, which are government bonds, corporate bonds, municipal bonds, and foreign bonds. Government Bonds are issued by the government. This type of bond has a relatively lower risk as it is issued directly by the government, including bonds issued by the Ministry of Finance or state-owned banks.

   Furthermore, there are Corporate Bonds which are debt securities issued by companies. Corporate bonds provide a relatively high interest rate to the holder. Even so, this type of bond usually has a relatively long term and a higher risk.

   There are also Municipal Bonds, namely bonds issued by local governments. The principle is similar to the type of government bond. While the last is Foreign Bonds which refer to bonds issued by foreign companies or institutions and use foreign currencies.

2. Learn more on the Bond investment

   In order to optimise profits, make sure you learn more about the Bond investment you choose. You need to read in detail the Bond issuance prospectus and find out the financial plan using the fund, the Bond investment period, and estimate the issuer's ability to meet payments.

   You also need to note some important information such as the name of the company or issuing institution, the amount of the bond yield or coupon to be paid, the maturity date, the payment period, the underwriter, and the principal amount of the debt to be paid.The more information that can be collected, the more confident you can be when putting your fund on loan to the bond issuer. You must always note that investing in Bonds means that you are lending some money to the issuer, be it a government or a private company.

3. Determine your investment goals

   As with other investment instruments, you also need to determine your investment target, whether for the long, medium, or short term. For medium and long term goals, you can buy Primary Market Bonds and hold them until the maturity date. However, for short-term goals you can invest in Secondary Market Bonds.

   Secondary Market Bond Investment allows the opportunity for flexible transactions at any time so you can earn additional profits through the difference between the purchase value and the selling value or capital gain.

   For Government Bonds, there are two series of Bonds that are commonly traded in the Secondary Market, namely Government Bonds denominated in conventional IDR (FR), and Government Bonds denominated in USD (INDON, INDOIS). The FR and INDON bonds series are issued by the Government of Indonesia for a certain period with a fixed coupon rate.

Bond Investment with DBS Treasures

To get the optimum benefit from investing in Bonds, you can start investing by buying Bond products through DBS Treasures. DBS Treasures is a priority banking for Bank DBS Indonesia clients with a minimum fund placement of IDR 500 million.

Investing with DBS Treasures will be very helpful for housewives who need to multitask in their daily life. DBS Treasures will strategise an intuitive wealth management so that you make the right move at the right time confidently.

By taking advantage of DBS Treasures wealth management services, you can plan all your short-term and long-term financial needs, and make the right preparations and investments.

If you are a priority DBS Client, at DBS Treasures you will be supported by a team of financial experts who collaborate to analyse the latest market data and risk profiles, then proactively share the latest opportunities and insights. You will also be supported by a variety of sustainable digital innovations such as the digibank by DBS Application that allows 24/7 investment transactions.

When you decide to buy Bonds through DBS Treasures, you will get various benefits including the following:

• Regular Coupons or Yields. With the regular coupon or yield, you will get a fixed income which is paid periodically during the investment period by the Bond issuer.

• Potential capital gains. Several types of bonds have the potential to earn capital gains. These bonds can be traded at any time prior to maturity date, so you can gain potential profits from the increased bond prices.

• Competitive coupons or yields. The Bonds available on DBS Treasures offer competitive coupon rates or yields above the average fixed deposit interest.

• No additional fees. DBS Treasures does not charge additional fees in Bond transactions. Transactions are only subject to spreads or the difference between the selling price and the purchase price (bid and offer).

• 24/7 Transactions. With the digibank by DBS Application, you can make transactions anytime when you have free time. There are also a variety of Bond products that can be traded in rupiah and US dollars.

Bond investment that utilizes DBS Treasures service will bring you new investment achievements. Being a housewife doesn't mean you can't contribute to your family's finances.