Can You Build a 4% Yield Ladder in Singapore? Bond ETFs, T-Bills and SSBs for Early Retirees

The 6-month Singapore T-bill auctioned on 8 October 2026 cleared at a cut-off yield of 1.90% a year, less than half the 4% that many early retirement plans pencil in as income. For anyone hoping to build a 4 percent yield ladder in Singapore for early retirement from government paper alone, that single number reframes the plan.

A yield ladder is a set of fixed income holdings arranged so that cash arrives on a predictable schedule: bills and bonds mature or pay coupons at staggered dates, and each payment funds the next stretch of spending. Singapore Savings Bonds are the other core rung, and the November 2026 issue pays 1.67% in year one, stepping up to 3.08% in year 10, for a 10-year average of 2.45% a year.

Investors here can build every rung of that ladder in Singapore dollars, using cash or SRS funds, through bank and broker accounts they already hold. What the building blocks cannot do in October 2026 is pay 4% without extra risk. Reaching that figure in cash income means taking on longer duration, lower credit quality, foreign currency or equity exposure, or accepting that part of each year's spending comes from selling units.

The realistic options are a ladder that pays roughly 2% and draws down principal for the rest, a ladder that tilts towards higher-yielding bonds and their risks, or a total-return plan that treats 4% as a withdrawal rate. Each can work, and each fails in a different way.

This guide explains the four meanings of "4%", how today's T-bill, SSB and bond ETF yields compare, a worked S$1.2 million ladder for S$48,000 of annual spending, what it would take to close the income gap, where SRS fits for someone retiring before 63 or 64, and the risks that matter most.

4% yield ladder in Singapore at a glance

Each rung's current yield sits next to the 4% target. All figures are nominal, before inflation, and the yield measure differs by instrument.

Source: Beansprout T-bill allotment, 8 October 2026, MAS SSB GX26110X announcement, Amova ABF Singapore Bond Index Fund factsheet, Amova SGD Investment Grade Corporate Bond Index ETF factsheet (as of 18 October 2026). ETF figures are factsheet data as of 31 August 2026.

The short answer: every Singapore-dollar government and investment-grade rung sits below 4% today, and the highest of them, the SSB's final-year coupon, is still almost a full percentage point short.

Four different meanings of "4%"

Retirement forums use "4%" for at least four separate ideas, and mixing them up is the most common reason a ladder plan looks better on paper than in a bank statement. The first two describe what a security pays. The last two describe how much you choose to spend.

A distribution yield is the cash a fund or bond pays over a period divided by its price. A yield to maturity (YTM) is the annualised return you would earn by holding a bond to maturity if every payment arrives and coupons are reinvested at the same rate. For a bond fund, YTM is an average across holdings, and the A35 factsheet spells out that its YTM does not represent the fund's actual rate of return or distribution yield.

A total-return withdrawal rate is a spending policy: you withdraw a set percentage of the portfolio each year, funded by income plus sales of units. The "4% rule" is a planning heuristic drawn from historical market returns, usually described as withdrawing 4% of the starting portfolio in year one and raising that amount with inflation. It assumes a diversified portfolio that includes equities, and it was built on markets and periods that may differ from a Singapore early retiree's.

From here on, YTM and current coupons serve as the income proxy, because those are the figures issuers publish. Actual cash received from a bond ETF in any year can be higher or lower.

Today's T-bill, SSB and bond ETF yields compared

Government and investment-grade yields in Singapore dollars cluster between about 1.7% and 2.9% in October 2026. Only two foreign-currency bond ETFs clear a 4% line.

Singapore T-bill, SSB and bond ETF yields against a 4% target, October 2026

T-bills: short, liquid and repricing

T-bills are issued at a discount and repay face value at maturity, so the whole return arrives as one lump sum. The 8 October 2026 6-month auction drew S$17.8 billion of applications for S$8.3 billion allotted, with a median yield of 1.86% and the 1.90% cut-off. MAS runs 6-month T-bill auctions every two weeks, which makes them easy to stagger but also means your yield resets every six months.

SSBs: step-up coupons with an exit any month

The November 2026 SSB coupons rise each year: 1.67%, 2.00%, 2.19%, 2.35%, 2.49%, 2.61%, 2.70%, 2.79%, 2.91% and 3.08%. Coupons are paid every six months, and you can redeem in any month without penalty to get principal plus accrued interest. Applications for this issue close at 9pm on Tuesday 27 October 2026.

The catch for a ladder is size. The individual limit is S$200,000 across cash and SRS holdings, so SSBs can only ever be one rung for a seven-figure portfolio. Each application or redemption through a bank costs S$2.

SGD bond ETFs: more yield, with price risk

The ABF Singapore Bond Index Fund (SGX: A35) tracks the iBoxx ABF Singapore Index of Singapore-dollar bonds. Its August 2026 factsheet shows a weighted average YTM of 2.40%, an 8.31-year average duration and an AAA average credit rating, with distributions paid semi-annually and not guaranteed. Its total expense ratio was 0.24% a year for the financial period ended 30 June 2025.

The Amova SGD Investment Grade Corporate Bond Index ETF (SGX: MBH), still traded on SGX under its former Nikko AM name, holds Singapore-dollar corporate and other non-sovereign bonds. It shows a 2.87% YTM, a 5.84-year duration and an A average rating as of 31 August 2026, with a total expense ratio of 0.26%. The extra 0.47 points over A35 is the pay for taking corporate credit risk.

Foreign-currency bond ETFs that clear 4%

Higher yields exist outside Singapore-dollar government paper. The US dollar-hedged share class of the iShares Core Global Aggregate Bond UCITS ETF (AGGU) shows a yield to worst of 4.47% with a 6.02-year effective duration as of 5 October 2026. For a Singapore investor, that yield comes with US dollar exposure, because the share class is hedged to USD.

The iShares Global High Yield Corp Bond UCITS ETF in its USD accumulating class (HYLA) shows a yield to worst of 7.38%, a 3.12-year duration and a 0.50% TER. It holds bonds rated BB and below, so the yield is compensation for default risk, and its one-year return to 30 September 2026 was -0.37%.

Designing a ladder for S$48,000 a year

A ladder works best when it starts from spending. Say a household needs S$4,000 a month, or S$48,000 a year, and has S$1,200,000 to invest. S$48,000 is exactly 4% of S$1.2 million, which makes it a clean test of the target.

The structure has five rungs, each with a distinct job:

Cash reserve: S$48,000. Twelve months of spending in an instant-access account, outside SRS, so a bad month in markets never forces a sale.

T-bill rungs: S$192,000. Two rungs of S$96,000 in 6-month bills, bought three months apart so that one matures every quarter. Each maturity sends S$12,000, one quarter's spending, to the cash reserve and rolls the rest into the next auction.

SSB tranche: S$200,000. The full individual limit in the November 2026 issue. Because SSBs can be redeemed in any month, this rung doubles as a second liquidity buffer if T-bill yields fall or spending spikes.

Government bond ETF sleeve: S$380,000 in A35. Longer duration and AAA credit quality, paying semi-annual distributions.

Corporate bond ETF sleeve: S$380,000 in MBH. Investment-grade credit with a shorter duration than A35.

Example S$1.2 million yield ladder with cash, T-bill, SSB and bond ETF rungs

The quarterly T-bill rhythm keeps the cash reserve topped up without selling bond ETF units, while the SSB and ETF sleeves provide coupons and distributions twice a year. The structure is easy to run with two calendar reminders a quarter: one for the T-bill auction and one to move money into the spending account.

Can S$1.2 million produce S$48,000 without drawing principal?

Not at October 2026 yields. Multiplying each rung by its current yield gives the portfolio's expected annual income, before tax and assuming rates hold steady for a year.

Example only, based on Beansprout T-bill allotment, MAS SSB GX26110X, A35 factsheet and MBH factsheet (as of 18 October 2026). Assumes ETF YTM as the income proxy, TER of 0.24% for A35 and 0.26% for MBH, a cash reserve earning nothing and no broker fees.

The blended yield lands at about 2.1% after fund costs, or S$25,114 a year. Against S$48,000 of spending, that leaves an income gap of S$22,886, which has to come from selling units, redeeming SSBs or spending down T-bill principal. Put differently, roughly 48% of each year's spending comes from principal.

Annual income from the example ladder against S$48,000 of spending

Most retirement plans spend some capital, and a 2% drawdown of the starting portfolio on top of 2% income is how a total-return plan reaches 4%. What matters is planning it: decide which rung is sold first, and test how long the portfolio lasts if yields fall further.

What it would take to reach 4% in income

Closing the gap through yield alone means swapping lower-yielding rungs for higher-yielding ones. Using the HYLA high yield ETF's 7.38% yield to worst less its 0.50% TER, the ladder would need to move about S$509,000, or 42% of the portfolio, out of A35 and MBH and into global high yield bonds to produce S$48,000 a year. The figure assumes the yields above hold and the money comes equally from the two SGD bond ETFs.

That swap changes the portfolio's character. More than two-fifths of it would sit in sub-investment-grade corporate debt, priced in US dollars, with defaults and currency moves able to wipe out several years of the yield advantage. A yield to worst is also only a starting estimate, and HYLA accumulates its income, so the "income" would still come from selling units.

Equities are the other lever. A diversified equity sleeve typically pays a lower dividend yield than these bonds but has historically offered higher total returns, which is why the 4% rule heuristic assumes equity exposure. Adding equities turns the ladder into a total-return plan, with larger swings in value in exchange for a better chance of keeping pace with inflation.

Does the SSB step-up close the gap later?

Only partly. If the full S$200,000 SSB tranche is held for 10 years, its income rises from S$3,340 in year one to S$6,160 in year 10 at the 3.08% final coupon. That is still below 4%, and it adds about S$2,820 a year to the ladder's income by year 10. Over the same decade, spending of S$48,000 growing at an assumed 2% a year would reach about S$57,364 in year 10, so inflation more than absorbs the step-up.

Example only, based on MAS SSB GX26110X coupon schedule (as of 18 October 2026). Assumes the full S$200,000 is held for 10 years and no bonds are redeemed.

Three ways to frame the plan

The same S$1.2 million can be run under three broad philosophies, and their trade-offs matter more than the headline yield.

Example only, based on the yields in the tables above (as of 18 October 2026). Income ranges are approximate.

A fourth path sits between them: keep the short ladder for the next two to three years of spending, and invest the rest for total return across bonds and equities. Selling from the growth sleeve to refill the ladder in good years, and pausing in bad years, is one common way to manage sequence risk.

Where SRS fits for early retirees

SRS is a useful wrapper for the ladder assets you will spend once you can withdraw without penalty. T-bills and SSBs can be bought with SRS funds through your SRS operator, and MOF allows SRS money to be invested in bonds, ETFs, shares, unit trusts and fixed deposits. Some brokers restrict SRS purchases to SGX-listed securities settled in SGD, which covers A35 and MBH.

The constraint is age. Penalty-free withdrawals start at the statutory retirement age that applied when you first contributed: 62 for first contributions before 1 July 2022, 63 from then until 30 June 2026, and 64 from 1 July 2026. Withdraw earlier and the full amount is taxable plus a 5% penalty.

For someone who stops working at 50, that splits the ladder into two tracks:

Before SRS age: spending comes from the cash reserve, T-bills, SSBs and bond ETFs held in ordinary cash and brokerage accounts.

From SRS age: SRS balances, ideally already invested in suitable rungs, start paying out over a 10-year window from the first penalty-free withdrawal.

Only 50% of each withdrawal after the prescribed age is taxable. IRAS's own example shows a S$40,000 annual withdrawal giving S$20,000 of taxable income and no tax if you have no other income, because the first S$20,000 is taxed at 0%. Spreading withdrawals evenly across the 10 years keeps more of each one inside that band.

CPF is the other piece of the puzzle for citizens and PRs. The Special, MediSave and Retirement Accounts earn a 4% floor rate, extended to 31 December 2027, but you can't draw on it the way you draw on a ladder rung, so it belongs in the long-term part of the plan.

Risks that can break a yield ladder

Every rung carries at least one of these risks, and a ladder that survives them all usually has a larger buffer than the spreadsheet suggests.

Reinvestment risk. Each T-bill maturity and SSB redemption is reinvested at whatever rate prevails. If 6-month yields fall from 1.90% to 1.50%, the S$192,000 T-bill sleeve earns S$768 less a year.

Falling rates. Lower rates help bond ETF prices but cut the income on every new rung. A ladder relying on short bills feels this first.

Rising rates and NAV drops. Bond ETF prices fall when yields rise, and longer duration means a bigger move. A35, with its 8.31-year duration, returned -1.83% over the year to 31 August 2026 despite holding AAA bonds.

Inflation. A nominal 2% yield loses purchasing power if prices rise faster, and a 30-year retirement compounds that gap.

Sequence risk. Selling bond ETF units after a price fall locks in the loss. The cash reserve and T-bill rungs exist so you can wait.

The SSB limit. S$200,000 is the ceiling per person, so most of a larger portfolio must sit in instruments with price risk.

Credit and currency risk. Higher-yield and foreign-currency bond funds add default and FX exposure that SGD government rungs avoid.

Invest your retirement ladder with StashAway

StashAway offers three ways to fill different rungs of a ladder, with cash or SRS. The Simple Cash suite suits the reserve and short-term rungs, with a projected rate range of 3% p.a. to 6.2% p.a. For the growth or total-return sleeve, General Investing powered by StashAway builds managed, globally diversified ETF portfolios, with 1-year returns of 6.4% to 26.6% across risk levels.

If you prefer to pick your own bond sleeve, ETF Explorer lets you choose bond ETFs among 90+ asset classes for US$1 per order, including US-listed and UCITS ETFs bought with SRS funds. Investment values can fall as well as rise, and SRS withdrawal rules apply whichever product you choose.

Frequently asked questions

These are the questions early retirees most often ask about building a 4% income ladder in Singapore.

Can SSBs give 4% in 2026?

Not from the current issue. The November 2026 SSB pays 1.67% in year one and 3.08% in year 10, for a 10-year average of 2.45% a year. Even the final-year coupon is almost a full percentage point below 4%.

Can T-bills still pay 4%?

Not at current auction levels. The 6-month T-bill auctioned on 8 October 2026 cleared at 1.90%, and the yield resets at every auction, so a T-bill rung pays whatever short-term rates are at the time.

Is a 4% yield the same as the 4% rule?

They are different ideas. A 4% yield is cash income from your holdings, while the 4% rule is a historical withdrawal heuristic that assumes you sell some units each year from a portfolio that includes equities. A ladder yielding 2% can still support a 4% withdrawal rate, but half of each year's spending then comes from principal.

Can bond ETF prices fall when interest rates rise?

Yes. Bond ETF prices move inversely to yields, and longer-duration funds move more. A35 holds AAA-rated Singapore bonds yet returned -1.83% over the year to 31 August 2026.

How much do I need for S$4,000 a month of retirement spending?

At a 4% income yield you would need S$1.2 million, but current SGD yields of about 2.1% after fund costs would produce only S$25,114 on that sum. Covering S$48,000 from income alone at 2.09% would take roughly S$2.3 million, so most plans combine income with planned drawdown.

Should early retirees hold their whole ladder in SRS?

Usually not. SRS withdrawals before your prescribed age of 62, 63 or 64 are fully taxable with a 5% penalty, so the first years of an early retirement need to be funded from ordinary accounts. SRS works well for the rungs you will spend from that age onwards.