What to Invest in After Maxing Out Your SRS Contribution in Singapore
Reaching your SRS (Supplementary Retirement Scheme) contribution limit is a significant milestone in your wealth-building journey. It demonstrates financial discipline and a smart approach to tax planning. But the question that often follows is: “What’s next?”
If your investment approach ends at your SRS account, then you're missing out on potential growth and sophisticated tax-planning opportunities as well. The standard SRS investment options, such as unit trusts, Singapore Savings Bonds and ETFs, are great starting points. However, for qualified and advanced investors, the real opportunity of portfolio optimization is outside this envelope.
This guide will walk you through the logical next steps, from reviewing standard SRS-compliant options to introducing advanced, institutional-grade strategies that can elevate your entire financial landscape.
First, A Quick Refresher: Standard SRS Investment Options
Your SRS funds can be invested in a wide range of instruments. If you haven't fully utilized these within your SRS, they are a logical starting point:
Unit Trusts & ETFs: Provide instant diversification across equities and bonds. Look for low-cost index funds for core holdings.
Bonds: Including Singapore Government Securities (SGS) and Singapore Savings Bonds (SSB), offer stability and predictable returns.
Shares: You can purchase stocks listed on approved exchanges directly.
Real Estate Investment Trusts (REITs): Offer exposure to the property market without the need for direct management.
Fixed Deposits & Insurance Products: Provide capital preservation, though returns are often modest.
While these are good building blocks, they are mostly oriented towards public markets. But to build a truly resilient, high-performance portfolio, you need to look past them.
The Next Frontier: Sophisticated Strategies for Your Non-SRS Capital
After you have optimized your SRS, you are left with your non-SRS, personal capital. This is where you can use more complex, higher yielding and less correlated assets. As a strategic introducer to high-net-worth individuals and family offices, Ascendant Globalcredit Group offers access to exactly these opportunities.
1. Private Credit & Direct Lending
With conventional fixed deposits and even corporate bonds yielding relatively low returns, private credit has stepped up to the plate.
What it is: Lending done directly to existing companies, usually for expansion, acquisitions or working capital, without a bank in between.
Why it's compelling: It may provide much greater returns than public bonds or structured deposits, usually between 8% and 12% p.a. Also, it offers a floating rate component acting as a hedge against increasing interest rates.
Our Role: We present accredited investors with carefully selected private credit funds and direct lending opportunities with a particular focus on sectors that have strong tailwinds in Southeast Asia.
2. Structured Notes for Capital Protection and Upside
Structured notes provide a middle ground between a too conservative investment, such as a Singapore Savings Bond, and an excessively volatile one, such as equity investing.
What it is: A custom-built instrument that links your return to the performance of an underlying asset (e.g., a stock index, a basket of stocks), often with a degree of capital protection.
Why it's compelling: They can be tailored to your specific risk-return profile—for example, "90% capital protection with participation in the upside of the S&P 500." This is a step beyond the one-size-fits-all nature of most ETFs and unit trusts.
Our Role: We source structured notes from leading investment banks with a focus on differentiating yield enhancement with rigid risk parameters, which is preferred by HNWIs who want a personalized product.
3. Tokenized Real Assets
This is the evolution of Real Estate Investment Trusts (REITs). Tokenization uses blockchain technology to fractionalize ownership of high-value assets like prime commercial real estate, fine art, or private equity funds.
What it is: Owning a digital share of a physical asset, providing liquidity and access to markets that were previously out of reach for all but the largest institutions.
Why it's compelling: It offers unparalleled diversification, potential for high yields from underlying assets, and the liquidity of a digital token. It moves you from being a passive REIT investor to a direct asset owner.
Our Role: Ascendant provides access to premier tokenized asset platforms, allowing our clients to build a diversified portfolio of global real assets with lower entry points.
4. Insurance Wrappers for Estate Planning
While insurance is a standard SRS option, its advanced use in estate planning is often overlooked. An insurance wrapper is a whole-life or universal life policy held within a specific structure.
What it is: A strategic tool where the investment portfolio (e.g., of bonds, private credit funds) is held within a life insurance policy.
Why it's compelling: It can provide significant tax efficiencies on investment growth and a tax-free death benefit for heirs, making it a powerful tool for multi-generational wealth transfer—far beyond the scope of a simple SRS withdrawal plan.
Our Role: We advise family offices and HNWIs on structuring insurance wrappers to preserve privacy and optimize the transfer of complex assets to the next generation.
Building Your Post-SRS Investment Strategy: A Practical Framework
Navigating this landscape requires a structured approach:
Assess Your Liquidity Needs: How much of your capital needs to be readily accessible? This portion may remain in cash, SSBs, or money market funds.
Define Your Core-Satellite Allocation: Your "Core" should be a diversified portfolio of public assets (the ETFs, shares, and REITs in your SRS). Your "Satellite" is your non-SRS capital, allocated to the higher-conviction, alternative strategies mentioned above.
Partner with a Strategic Introducer: Accessing top-tier private credit funds, structured notes, and tokenized assets requires deep institutional relationships and rigorous due diligence—this is the core value Ascendant Global Credit Group provides.
Conclusion: Your SRS is the Foundation, Not the Ceiling
Maxing out your SRS contribution is a commendable achievement, but it should be the beginning of your sophisticated wealth strategy, not the end. By strategically allocating your non-SRS capital to institutional-grade alternatives like private credit, structured notes, and tokenized assets, you can build a more resilient, diversified, and higher-performing portfolio.
Ready to explore what's beyond your SRS? Ascendant Globalcredit Group specializes in introducing accredited investors and family offices to exclusive, rigorously vetted private market opportunities.
Frequently Asked Questions (FAQs)
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Within your SRS, focus on a diversified, long-term portfolio. A mix of low-cost ETFs (for global equities), Singapore Government Securities or SSBs (for stability), and select REITs (for income) forms a strong core. The goal is tax-deferred growth over a 10-year horizon.
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No investment is both perfectly safe and high-return. Singapore Savings Bonds are among the safest, but returns are modest. For higher potential returns with managed risk, sophisticated investors turn to private credit and structured notes, which offer attractive risk-adjusted returns compared to traditional fixed deposits or bonds.
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Topping up your SRS provides immediate tax relief, reduces your taxable income, and allows more capital to grow in a tax-deferred environment until withdrawal. It's one of the most efficient tax-planning tools available to Singapore residents.
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After the statutory retirement age (and a minimum 10-year holding period), you can make penalty-free withdrawals. The amount withdrawn is only 50% taxable, and if structured carefully, can result in little to no tax payable, especially if you are no longer earning a high income.