The Only Budgeting Plan That Will Ever Work for Singaporeans

Ryan Ong



You know the problem with budgeting? It requires a lot of discipline. And most people who need to budget lack that exact quality. So when I tell them to control their spending, it’s about as helpful as yelling at a drowning man to try swimming. I’m sick of it. In this article, I’ll cover the only budgeting plan that will ever work for Singaporeans (according to a fact I just invented):

Why Many Singaporeans Can’t Budget

I’ve covered this in another article, but I’d like to highlight a local problem: It’s called crash budgeting. This is like crash dieting, except the ATM screen replaces the weighing scale.

See, many Singaporeans start budgets out of sheer guilt.

They buy an expensive bag, laptop, dryer, etc. that they know they can’t afford (aren’t credit cards awesome?) Once the thrill of buying’s over, panic sets in. They realize the full horror of what they’ve done, and decide to atone by being super-frugal. They tighten their belts, and swear to maintain a lifestyle that makes Somali refugees look decadent.

But that kind of budgeting’s unsustainable. Sure, you can avoid buying an extra yogurt or coffee for a few months, and deny yourself the little joys that make life bearable. But you can’t do it for years on end. And that’s the thing about budgets:

They have to be sustainable.

So forgot the crash budgeting, and try this method instead:


1. Track the Big Five


Lambo outside coffee shop
“What? Your chicken rice is 50 cents more? So uneconomical!” – True Story


Forget about tracking every cent you spend. You do that and I give you two months, tops, before you’re murdering small animals from sheer frustration.

You’ll do some tracking, but you’re going to focus on big expenditures only. So grab some pen and paper, and write down what you think are your five biggest sources of spending (besides necessary bills). Odds are, you can already guess what these are. For example:

  1. Video games
  2. Car accessories
  3. Clothes
  4. Buffets
  5. Bigger Clothes

Once you’re done, you’re going to spend the next three months tracking these five main costs. Just these five, and nothing else. Figure how much you spend on each of them (you can use tools like OCBC’s Money In$ights to automatically track expenditures).

Don’t bother trying to collect every receipt and count coins. It’s personal finance, not a part-time 7-11 cashier’s course.


2. Automate a Fixed Savings Portion


ATM machine
Of course I automate. When my pay comes in my wife automatically draws it all out.


Decide how much you want to save each month (10% of your income is decent, 20% is good).

Set this amount to be deducted every month, and put it into another account. This should be done before paying your bills, or anything else. Don’t think about it too much; this money needs to be more invisible than Usher’s music career.

And no matter how small the amount is, do it anyway. Never think along the lines of “Oh, if $20 is all I can put aside, why bother?” If you have too little to open a savings account, stuff it in a sock for now. That’s about as good as the bank’s interest rate anyway.*

*I’m kidding. But 0.125% is pretty pathetic.

Now that’s done, back to the big five.


3. Narrow Down the Big Five


Canned spam
I have a rare talent for grocery budgeting. It’s called bad taste.


Of the five main costs, arrange them in terms of priority. And by priority, I mean psychological need. 

How do you you feel when you make those purchases? Which two out of five make you feel the most fulfilled and happy? Take them off the list.

Now look at the remaining three. Your goal will be to reduce these three remaining expenditures, by at least 30% each. You will do this for three months. So if one of the three is “eating out”, and you spend $700 on it every month, you want to spend no more than $490 for the next three months.

If you’re like most Singaporeans, this will translate to saving around $170 to $200 each month. Either lump that with the savings you’ve set aside, or use it to build an emergency fund.


4. At the End of Three Months, Review


I think we need to review the food budget. There’s no more algae to scrape off the fish tank.


Our spending habits are’t static. Some urges grow stronger, other diminish.

So after three months, stop and consider your main expenditures again. Are you still happy with the three things you’re saving on? Or have new expenditures appeared to take the place of previous ones?

Revise accordingly, and go back to trying to shave 30% off the top three expenditures. Keep doing this every three months.


Why Just Three?

It’s less stressful. The idea is to target and control major expenses, not hundreds of little ones (which are tiring to control, and amount to very little in the end).

So you use your willpower to save on a few big costs, rather than waste it trying to save a dollar on a Sundae, two dollars on fruit juice, etc. Trust me, you’ll feel a lot less miserable.

Also, this is something you can do over a prolonged period. It’s not realistic to design a static budget, then try to follow it for the next five to ten years. That sort of long term planning is best handled in other ways, like comprehensive savings and investments. Follow us on Facebook, if you want help with that.

Image Credits:
kenteegardin, Shiny Things, Abishek_Kumar, epSos.de, danielmoyle

How well do you budget? Comment and let us know!

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Ryan Ong

I was a freelance writer for over a decade, and covered topics from music to super-contagious foot diseases. I took this job because I believe financial news should be accessible and fun to read. Also, because the assignments don't involve shouting teenagers and debilitating plagues.