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January has just passed – how intact is your 2007 financial resolution? Are you disciplined keeping up with your goal? Have the money planned for saving now gone to a MP3 player? Or money meant for house renovation now became uncounted for? Are you close to officially admitting defeat?

Not to despair, HSBC is offering you one last chance, or more correctly, 10 chances.

HSBC Amanah Malaysia, the Islamic financial services arm of HSBC Bank Malaysia Bhd recently launched an Amanah saving account that allows you to create personalized mini saving accounts to cater to your various specific saving purpose. HSBC called it “Protect your dream

This is how Amanah Smart Account-I works – conduct completely via the internet, you can create up to 10 sub saving accounts from the principle account. Each sub-account, or mini saving plan would represent a specific personal financial goal, such as saving for a car down payment, holiday, house renovation etc.

To make it work, you need to specific the time period (tenure) up-front and set-up a standing instruction (SI) from the principle account for each of the sub account created. The minimum tenure is 6 months and maximum is 120 months while the minimum monthly SI is RM50.00. From then on the bank take over and no changes can be done until the account matured. Premature closures of the sub accounts will set you back RM20.00. Money in sub-account cannot be withdrawn directly – it must be transferred to principle account first.

Amanah Smart Account-I is a Shariah-based product and as such, it pays Indicative Profit Rate (IPR) instead of interest rate for balance in the accounts. Here is a quick comparison of IPR with other regular saving account

Do keep in mind that the IPR is based on individual amount in principle and each of sub accounts, not the total amount. Therefore the more sub accounts you have, the lesser you earn in overall profits (interest).

Is Amanah Smart-i for you?
First thing first, this account is not free – it comes with a monthly charge of RM5.00 (RM60.00/yr). The minimum amount to open the account is RM1,000.00.

So who can benefit from Amanah Smart-i?

According to its press release, Amanah Smart is targeted at the “young and smart, yuppies who like easy life and are IT savvy.” Therefore there is little surprise that its advertisements are seen more keen on promoting saving for a big ticket consumption later (e.g. plasma TV, dream car) than for cultivating a good saving habit.

If you are the type who have multiple goals and are determined to achieving them all, you may find the sub-account feature a welcome benefit – it not only ‘forces’ you to save, but also offers a good tracking and monitoring on your progress. Needless to say, this works only when you have ‘meaningful’ amount of free money to be allocated to different accounts consistently over a period of time.

But if your primary aim is to save money, you will find the Amanah Smart-I’s sub-account feature is of little use. What more, its interest rate is also relatively less attractive. Having said this, since the minimum SI is only RM50.00, it could help one to start the saving habit. After saving enough, you can then transfer the saved amount to a FD to earn a better rate.

More on Amanah Smart Link Account-i (sub account)
Though you are free to create up to 10 sub accounts, you do need to have discipline to maintain them. HSBC will charge you RM20.00 each time if you:
• Closed the account prematurely
• SI failed consecutively for 3 months
• Failed to set up SI within 3 months of setting up any sub account.

Fees and Charges
Here is a quick run down on the terms and conditions, and related fees

Click here For HSBC Amanah account press release on The Edge Daily

Key words:
HSBC Amanah Malaysia; Islamic financial; HSBC Bank Malaysia Bhd; Indicated Profit rate (IPR); Amanah Smart-i; Amanah Smart Link-i; 10 sub accounts; protect your dream; young and smart, easy life, IT savvy