How to Put Your Salary Increment to Good Use

If you have recently received a salary increment or pay raise, here’s how you can invest it to grow your wealth in Singapore.

Priscilla Lee

by Priscilla Lee on Jan 12, 2024

money in wallet

Despite the slight uncertainty in the economy and job market due to geopolitical issues, employees in Singapore are still in a favourable position to gain at least a 4% salary increment in 2024.

A recent study by the Singapore Business Federation’s (SBF) on Manpower and Wages has also found that as many as 64% of small and medium enterprises (SMEs) and large companies across all major industries have planned to increase wages by an average increment of 6%, which way to get around the rising inflation which is trending at 4% for the whole of 2023.

That said, how will you make the most of your next salary increment or pay raise if you receive one?

Related: Five Salary Negotiation Tips for Your New Job

coins in a car
Source: Pexels

What To Do With Your Pay Raise or Salary Increment – Spend, Invest or Save?

Most people may choose between investing it to protect the value of their money, saving it for rainy days or spending it to pamper oneself. Whichever you choose to do, here are some recommendations that may help you optimise every dollar you receive.

Grow Your Wealth by Investing

Assuming you earn S$5,000 a month, a 4% increment would mean that you’ll have an additional S$200 every month. How can you start to invest with just a few hundred dollars of salary increment? You may not be able to buy a bunch of blue-chip stocks but you can invest small amounts consistently to accumulate a portfolio over time.

Start by looking for an online broker like moomoo or robo advisor such as Endowus that allow you to invest in ETFs or index funds for S$200 or less every month. These investment products are great for portfolio diversification, hence reducing your investment risk.

1 Apr - 1 Jul 2024: New users can get up to 6.8% p.a. returns with Moomoo Cash Plus.
Get a S$20 Cash Coupon and 1 free AAPL Stock (worth ~S$243) when you deposit S$100 and make 1 buy trade.
Valid until 1 July 2024. T&Cs apply.


moomoo by FUTU is a great brokerage for investors who are looking for a platform that allows them to get the most bang for their buck.



  • Lowest commission fees in Singapore
  • Lifetime $0 commission for US stocks
  • No minimum income requirement


  • Commission free trades only apply to US stocks, does not apply to SG or HK stocks
  • High margin rates
More Details

Alternatively, consider investing in conservative options like T-bills or bonds that require as little S$500 to start. When you buy bonds or T-bills with AAA credit rating, they are almost capital guaranteed and interests are also fixed as long as you wait for it to reach maturity.

Related: Dollar Cost Averaging: The Secret to Hassle Free Investing?

Compare Online Brokerages in SingaporeFind Out More

Optimise Your Savings with High Interest Accounts

There are many savings accounts in Singapore that offer more than the measly 0.05% interest rate per annum (p.a.). Let’s take the OCBC 360 Account as an example, it allows customers to earn as much as 7.65% p.a.

If you choose to deposit your salary increment or pay raise of S$500 per month into this Singapore account, you can earn an extra 1.20% on your first S$75,000 savings as Step-Up Bonus. You may also receive another 2% interest if you credit at least S$2,000 monthly salary to the account via GIRO.

Another way to earn more with your savings is to tap on fixed deposit accounts that offer the best interest rates. The commitment starts from as little as S$1,000 minimum deposit and the lock-in period can be as short as six months. These accounts are ideal for portfolio diversification because they are risk-free and require minimum effort to manage.

Here are some of the best fixed deposit accounts in Singapore that we have shortlisted:

BankInterest Rate (p.a)TenureMinimum Deposit
CIMB3.55%6 monthsS$10,000
Hong Leong Finance3.30%6 monthsS$500,000
ICBC SGD Step-Up3.35%3 monthsS$500
OCBC3.10%6 monthsS$30,000
Standard Chartered3.10%6 monthsS$25,000
UOB3.10%10 monthsS$10,000
Interest rates and tenures are accurate as of 2 Jan 2024
contactless payment
Source: Unsplash

Make Informed Choices When You Spend

There is nothing wrong with pampering yourself when you receive a salary increment or pay raise. After all, spending is good for the economy. However, researching your options and creating a budget is a must to avoid impulse buy and going beyond your means. The last thing you want is to spend beyond your increment and end up in debt.

If you are a savvy shopper, you must have realised that using the right credit card while you shop is the best way to make the most of your hard-earned money. Using the right card can let you save more and earn more rewards along the way.

Not sure which card offers the best deal for your next purchase? Here are some credits cards with the best rewards for different shopping categories:

OCBC Titanium4 miles per S$1 on fashion and select
KrisFlyer UOBUp to 3 mile per S$1 on online shopping, dining, food delivery, travel and transport
HSBC Revolution4 miles per S$1 online and contactless spend
DBS Woman’s World4 miles per S$1 for online shopping
Citi Cash Back Plus1.6% unlimited cashback on all spend
HSBC AdvanceUp to 3.5% cashback capped at S$300 per month
OCBC Frank8% on foreign currency transactions and online/contactless mobile transactions in SGD
UOB EVOLUp to 8% on online and mobile contactless spend
Citi Rewards4 miles per S$1 on online spend, rides and online food delivery

Compare The Best Credit Cards in SingaporeFind Out More


Even though Singapore’s economic outlook for 2024 is unclear at the moment, the prospect for salary increment is looking promising. If you do receive your well-deserved salary increment or pay raise in the near future, be sure to invest, save or spend the extra amount wisely and with clear financial goals in mind.

When in doubt, our list of best savings accounts and best online brokerages can help you multiply your wealth with ease.

Read More:

Cover image source: Pexels

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