3 Bad Money Decisions Singaporeans Make Way Too Often

Joanne Poh


It’s arguable that Singaporeans don’t face as many big life decisions as their counterparts in other countries. Choosing a course of study, buying a home and getting married are all pretty much automated decisions—we tend to pick the course of study that offers the most lucrative jobs upon graduation, apply for an HDB flat at a certain stage in our relationships and propose when the keys to the flat are almost ready for collection. Yawn.

Which is probably why so many Singaporeans are at a loss when it comes to making decisions about money. Because when it comes to personal finance, there isn’t a blueprint we can just cut and paste, nor are there role models we can try to mimic, since everyone’s financial situation is different. Here are three bad money decisions Singaporeans are prone to making.


Letting their home be their only investment

We all know property is expensive in Singapore and that the barrier to home ownership is high. Most people are just plain unable to afford their first property until they get married or turn 35.

At the same time, this system has generated a sort of laziness in Singaporeans to find out what to do with their money before they’re ready to buy property.

This news report revealed that a great many people just don’t bother saving and investing because they have more pressing financial concerns, of which buying a home is often one. Another report featured a respondent who commented about prioritising buying property over saving and investing for retirement.

The problem is that, while many Singaporeans are banking on the value of their homes to increase over the years just as their parents’ did, that’s not always the best retirement plan for the people of our generation, especially if you have nothing to fall back on should your property value tank.

Sure, you could technically sell your property and downgrade, but will you really want to when the time comes, especially if you’ve been living there for decades? Unless you really have the cash to purchase a second property, you still need to think of other ways to invest.


Overspend now, worry later

If the education system is anything to go by, Singaporeans should be a responsible and dutiful lot, faithfully plugging away for the betterment of their future.

But when it comes to overspending, it seems a lot of Singaporeans are completely out of control. A 2014 news report highlighted Singapore’s rising consumer debt problem, which has had many people shopping, eating and holidaying their way to credit card debt.

This is a more pervasive problem than you might think, since on the surface young Singaporean professionals look like a prosperous lot with their designer bags and penchant for expensive restaurants.

But guess what, having cash flow problems is pretty common even amongst cream-of-the-crop employees in the civil service and banking. These are people who earn healthy salaries and enjoy upward mobility. If these folks are in debt, there’s a high chance it’s their lavish lifestyles that are doing them in, not just the high cost of living.


Thinking of kids as an investment

The average Singaporean parent pins a lot of hopes on his or her kids—that can be the only reason local children behave more like sweatshop workers than actual kids, at least based on the lack of time they have for rest and play.

In a 2015 survey, 75% of the Singaporean mothers surveyed had not started planning for retirement, while 44% declared that they intended to rely on their children in retirement.

Now, we’re not even going to go into the moral implications of such a mindset but rather the practical concerns.

Even if your kid aced the PSLE, there is no way you can force him or her into a high paying job, since this is largely a matter of personal choice. If your child decides to become a stay-at-home mum herself, work as a starving artist or take on a less stressful job that pays less, these factors will have an impact on his ability to provide for you financially.

In addition there’s no telling how expensive Singapore will be by the time your kid grows up, and whether he will have his own financial burdens like your grandkids, home loan repayments or medical needs.

Unless you have 7 kids like they did in the old days, this is probably not the best retirement strategy, so try relying on yourself for a change.

What other bad money decisions are the Singaporeans around you making? Share your thoughts in the comments!

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Joanne Poh

In my previous life, I was a property lawyer who spent most of my time struggling to get out of bed or stuck in peak hour traffic. These days, as a freelance commercial writer, I work in bed, on the beach, in parks and at cafes, all while being really frugal. I like helping other people save money so they can stop living lives they don't like.