As a country, we’ve gotten complacent about how rich we really are. A little too satisfied with the amount we earn, perhaps. Although as a country we’re earning a median wage of about $3,770 (last I checked), how many of us can confidently say we’re truly financially secure? Tell you what, here are 8 bad habits that financially secure Singaporeans have gotten rid of. Let’s see how many don’t apply to you:
1. Actually waiting to spend the GST Voucher
Some of you may be among the 1.6 million Singaporeans who will have gotten your letters about this year’s GST Voucher. Even though you’ll only get the money by August, some of you may already be planning how you’re going to spend the $300.
A financially secure Singaporean, however, will not see “surprise money” as something to be spent, but something to be saved. After all, the GST Voucher is meant to help lower-income families subsidise the effect of an increase in GST.
It’s not a prize for not earning enough.
The same goes for the upcoming “SG50 bonus” for you civil servants!
2. Letting small expenses add up
Have you ever heard the phrase “penny wise, pound foolish”? It basically refers to people who know how to save on small things. I’m not saying you have to be an absolute cheaponana when it comes to spending. It often backfires. Don’t buy one-ply toilet paper, for example – you’ll just end up using more at a time and having smelly fingers.
However, small expenses do add up. Financially secure Singaporeans know this well and find ways to save. Raising your air-con temperature just by one degree might not seem to make much of a difference to your comfort, but it will probably save you a few dollars each month. A few dollars may not seem like much, but by adjusting your expenditure in just 4 steps, you could end up saving a few thousand dollars a year. Obviously there are many many more little hacks you can employ like hunting for free parking, saving on household items, etc.
3. Not waiting till the end of the month to find out how much you’ve spent
The only reason you should be surprised when you check your monthly credit card bill is if you see a fraudulent transaction on it. Credit card fraud aside, you should always be aware of how much you’ve already spent that month.
Financially secure Singaporeans use expenditure tracking apps to ensure that they’re on top of their daily, monthly and yearly spending. Or, you know, use a notebook and pen the old-fashioned way.
4. Subscribing to everything
Subscriptions are a tricky thing because they’re subtle. Often without your awareness, they’ll just charge your credit card and before you know it, you’ve signed up for another month of the service. It’s like that with me and the WWE Network, an online professional wrestling app that charges me US$9.99 at the start of each month. Even though I haven’t had the time to fully utilise the service, I’m still forking out a nominal amount each month for it. I’ve already spent close to $100 on it!
Even if you’re not a pro wrestling fan, there are other subscriptions you might be chained to – Spotify, various magazine subscriptions, that web video service that you once signed up for as a horny teenager and regretted ever since. I’m not judging. Really.
Financially secure Singaporeans only subscribe to what they need and keep track of them. They know better than to spend without thinking. Which brings me to my next point.
5. Spending before thinking
Look, we get it. It’s not your fault you bought that extra pair of shoes. Or that handbag. Or those gorgeous earrings. Blame the retail shops for using such impressive sales tactics to con you into spending your hard-earned money. But sooner or later, the only one who has to deal with the consequences of your spending is you.
Financially secure Singaporeans aren’t compulsive buyers. They make it a point to analyse and consider if a purchase is sensible by asking themselves two basic questions.
First, “Do I really need this?” Now, you might think this an unfair question. Especially when everyone’s telling you you’re wasting money on “luxuries” like massages, or seemingly overpriced gyms. But the truth is, that shoulder massage, or that novelty gym might be just what you need to live a healthier, more energetic life. Only you should decide if YOU really NEED something. That console game or that DVD box set you simply won’t have time to get around to? Don’t buy that.
The second question is, “Can I afford to buy this?” This actually brings us to our next point.
6. Not spending more than you make
You know how you’re desperately looking forward to the start of the month because you’re broke and that’s when your paycheck comes in? Financially secure Singaporeans don’t live paycheck to paycheck. In fact, for most financially secure Singaporeans, deciding how to budget your salary is an important monthly exercise.
Your salary should ideally be divided this way – how much you want to save, how much you want to invest, how much you need to spend (on your loan repayments, utilities bills, insurance, and so on) and then, finally, how much you can spend for the month. In that order, and no other.
If you prioritise spending your salary first, you’ll find you have very little savings in an emergency fund and you could be wiped out should something serious occur.
7. Not having financial goals
When I was young and stupid (last year), I was asked “What are you saving for?” My answer – “Uh… the future?” It was a half-baked response and betrayed the fact that I had never really thought about the question enough to formulate a decent answer.
Financially secure Singaporeans always have a specific answer when asked, “What are you saving up for?” and “How much do you hope to make through your investments?” They have plans that are both short-term and long-term, with set goals that they can achieve through these plans.
If you were to ask me now “What am I saving up for?”, my immediate answer is – “To buy a two room HDB flat as a single.”
“How much do you hope to make through your investments?” – “Enough to pay for my downpayment.”
8. Thinking you’ll be able to pay off your debts easily
The biggest problem with credit card debt, believe it or not, is not the amount you owe. It’s the amount you keep adding to it because you think you can pay it off easily soon. What happens instead is that the credit card interest keeps snowballing, getting bigger and bigger. And yet people in debt just don’t seek help to become debt free.
I’m not saying that financially secure Singaporeans don’t get into debt at all. Instead, I’m saying they avoid debt that doesn’t benefit them. Home loans, education loans, these are examples of “good debt” that acts like an investment that can give you future gains. Credit card debt, on the other hand, is the worst kind of debt you could ever get into (I mean, apart from borrowing from an ah long).
What other bad habits have you gotten rid of in your journey towards being a financially secure Singaporean? Share them with us.
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