5 Bad Financial Habits of Singaporeans in Their 30s and How To Avoid Them

bad financial habits

If I had a dollar for every time someone reminded me that Singapore is the most expensive city in the world, I would probably have enough money to live comfortably in it. But are we broke simply because everything is expensive?

As much as we’d like to point fingers, according to the recently published OCBC Financial Wellness Index, it seems that many Singaporeans in their 30s have some nasty money habits of to blame too.

Here are the top 5 bad financial habits and how you can avoid them.


1. Not sticking to your budget

Some cap their lunch money at $X per day, others limit their spending to $X per category per month. But even though almost everyone around me has some sort of “budget plan“, how many actually follow through?

Among survey respondents in their 30s, 29% of the men and 39% of the women said admitted that they don’t stick closely to their budgets.

There could be several reasons for this, but many times, people set unrealistic budget plans. It’s may be tedious to work out the nitty gritty numbers — working backwards, based on your overall savings goals — but it’s well worth your time.

If you don’t, you may end up setting targets that are just not practical to achieve.

If you’re the kind who thinks you’re following your plan, but are always surprised by your account balance at the end of the month, I recommend downloading a budgeting app to track your expenses.

By logging your everyday spending, you could possibly gain better insight into what’s draining all your moolah. You can also try to free up some cash by reviewing some of your recurring expenses like your telco plan and electricity retailer.


2. Paying only the minimum sum on your credit card bills

Another bad habit some Singaporeans have is only paying the minimum sum required for your credit card bill. That’s 25% of the male and 29% of the female respondents for you.

Usually, the minimum sum is 3% to 5% of the amount due or $50, whichever is higher. So say you spend $1,000 this month — your minimum sum will be $50.

Many people make the mistake of paying the bare minimum, thinking that they can then roll over the outstanding amount they owe without penalty. That is not true!

Paying the minimum sum “saves” you from late charges, but NOT interest charges on your outstanding balance, which is the real killer.

You should always pay in full, but if you really can’t, just pay as much as you can. The late interest charges are applied on the outstanding balance, so the less you owe, the less “extra” you pay.

I don’t really have a “tip” for this, because if you can’t afford to pay your bills in full, it just means you’ve spent above your means. So get your act together!

(JK, this is often a result a poor budgeting, which was covered above.)

If you’re still working on sticking to a budget and don’t want to incur unnecessary credit card charges… consider just cutting your card. For some, it may help to stop shopping on credit entirely.

It’s also worthy to note that when you only pay the minimum sum, you forfeit all your credit card perks like cash rebates and etc too.


3. Excessively speculate for quick gains

By definition, speculation is going after high risk investments, expecting significant returns. If you’re rolling in riches and are a pro investor, then good for you. Please hold a masterclass to share your wisdom.

But I doubt thats the category the 25% of male and 22% of female respondents fall into.

If you’re a beginner who’s just looking for a quick buck, then you should think twice about making such risky investments. OCBC did not explicitly state what “speculations” they’re referring to, but my guess is that it’s to do with volatile markets like forex and cryptocurrency.

Hell, it could even mean dabbling with things like the local lottery, right? If you’re just buying $1 on the 4-digit time a bird pooped on you this morning, fine. That’s by no means excessive. But if you’re pumping in $84 on system 9 Toto bets every week, then you should spend some time at the naughty corner to reflect.

When it comes to investments, it’s important to remember that there’s no shortcut. Don’t be greedy, and always learn to walk before you run. If you’re not yet an expert at investments, there’s no shame in that.

If you’re a complete newbie, you can consider starting with really easy beginner stuff like Singapore Savings Bonds, regular savings plans, or even blue chip ETFs.

If you’re in it for the thrill (not the money), then please go bungee jumping or something. You might die, but at least it’s cheaper.


4. Spending a large extent or above their means to keep up with peers

It’s no secret that we’re a very “face”-conscious society, so it should come as no surprise that many Singaporeans can get carried away trying to show off their “wealth” to their peers. Just look at these HDB status symbols Singaporeans are obsessed with.

According to the report, 21% of the men and 19% of the women admit to this.

The last thing you want is to spend what you don’t have, because spoiler alert: Debt is NOT fun. More on that below.

The peer pressure will always exist, so there’s not much anyone else can do to help you with it. So if you ask me, my advice is to just be honest with yourself and your friends.

If they’re always planning gatherings at expensive restaurants and fancy bars, suggest more affordable alternatives. If your friend shames you for it, then ditch them.

BAM! You would’ve just done yourself yet another favour.

As mentioned above, you should also cut back on your credit card reliance. Credit cards can be great tool to help maximise savings via cash rebates and rewards points, but if you already have a tendency to overspend, let’s not further facilitate it by putting money that you don’t have into your hands.


5. Borrowing money from friends and/or relatives too often

Some degree of debt is normal — many Singaporeans have to take up to loans to afford things like a university education, car and home. But that kind of loan we take up with the banks.

Not our personal circle.

Out of the respondents in their 30s, 11% of males and 13% of females said they frequently borrow cash from their friends and family. Although a relatively small percentage compared to the rest of the habits, it’s still a disconcerting number.

The keyword here is “often”, which implies it’s a recurring thing.

If you’re stuck in a financial emergency and your family very kindly offered to lend you some money first, sure. It was unanticipated and you’re lucky to have people who care enough to help out.

However, if you’re knocking on their doors every other month, asking for more money, then it’s definitely a problem.

Borrowing from people you know is “less bad” in the sense that you don’t incur the crazy interests rates offered by banks and licensed moneylenders, but it doesn’t mean you should let it become a habit.


Do you have any other tips to break these 5 bad financial habits? Share them with us in the comments below!