From day-to-day spendings to annual expenses, here are different ways to help you master your money in time amidst the economic impact of the Covid-19 pandemic.
REGAIN CONTROL OF YOUR CASH
The average Singaporean household spends around $4,900 monthly, according to the latest government Household Expenditure Survey. It also found that the average household expenditure in 2017 to 2018 increased by 0.8 per cent from 2012 to 2013. However, do you know where your money is going? It can be challenging to mentally keep track of what you are spending on when you are constantly juggling the bills, groceries, school fees and other expenses. To get ahead of this, you can get a clear picture of where your cash is going by using expenditure tracking apps like Seedly or Household Account Book.
BUDGET FOR THE YEAR AHEAD
Budgeting may not be as exciting as spending, but it’s a proven way to stay on top of your expenses. Decide the best budget planner for you – be it a spreadsheet, app or just a humble sheet of paper, then get on with drafting a road map that puts you in financial control. If a year sounds too daunting, take small steps. Start from planning your budget for the next week, then the following month, and eventually, the coming year.
STAY ONE STEP AHEAD OF YOUR HOME LOAN
If you’re paying extra on your home loan each month, pat yourself on the back. You’re on your way to mortgage freedom with generous savings on long-term interest charges. Paying a bit more off your loan will also stand you in good stead if, and when, rates rise. You can also get your housing loan repriced by switching from an HDB loan at 2.6 per cent interest to fixed-rate bank loans offering interest of 2 per cent or less.
CULL CREDIT CARD DEBT
Credit card debt has a way of sneaking upon us, and card interest charges, which can top 20 per cent or more, significantly add to the cost of card purchases. In an analysis by Asiafocused fintech company ValueChampion, it was found that the average household’s credit card debt had been steadily increasing over the years. If you have an ongoing card debt, aim to pay more than the minimum monthly repayment to clear the slate sooner, or perhaps switch to a balance transfer plan to pay off your debt at a lower interest rate.
REVIEW CYBERSECURITY HABITS
It is crucial to remain alert when it comes to protecting your data in real life, especially when it involves your financial information. A few precautions can keep your money safe. Never share your PINs or passwords with anyone, change them regularly and avoid saving payment details on shopping websites. Entering your payment details again each time you make an online purchase keeps the bad guys at bay. It might be a hassle, but it is better to be safe than sorry.
BE AN ACTIVE MONEY MANAGER
Playing an active role in money management is vital because it leaves you well-placed to know where you stand financially, and that’s a critical starting point to set and achieve shared goals. There are plenty of high-quality, free resources to help improve your understanding of money matters.
HUNT FOR VALUE-ON INSURANCE
From home to car insurance, it can be tempting to pay insurance renewals only when they arrive. But, in a competitive market, chances are you’re missing out on valuable savings by switching to a cheaper product. The internet makes it very easy to compare premiums and policies, and some providers offer savings to new customers who pay for cover online.
GROW EMERGENCY FUNDS
According to a report by financial comparison site GoBear last year, about half of all Singaporeans do not have six months’ worth of emergency funds if they were to lose their jobs, while one in five admitted that they did not even have one month’s worth of funds. Growing a pool of emergency cash doesn’t have to feel overwhelming. Begin by working out what you can afford to tuck away each week, fortnight or month. It doesn’t have to be a huge amount; even small amounts can grow into impressive sums when you save regularly. Make it effortless by setting up an automatic transfer of funds into a dedicated savings account, then sit back and watch your pool of rainy-day money grow.
Real-Life Tips: How to Budget, Spend & Save Money
Experts, well-loved personalities, and real mums dish out their top tips for effective money management
Kelly Latimer
33, host and presenter, and mother-of-one
We are firm in explaining to our daughter that she can’t have everything. She also sees how hard we work and the hours we put in. So she understands that we work hard for the money that it takes to buy what she wants. Kids are a lot smarter than we think
Zahra
31, sales manager, and mother-of-one, and pregnant with #2
"When it comes to saving, I allocate 50 per cent of my salary on essential needs, 30 per cent on savings, and 20 per cent on insurance and emergency expenses"
Grace Lim
49, realtor at OrangeTee & Tie, and mother-of-two
"Consolidate your spending by sticking to one or two credit cards so that annual membership fees on these well-utilised cards may be waived more readily by banks"
Joyce Cher
52, business development manager, and mother-of-two
"Always spend within your means, and avoid zero interest bank instalment plans if you lose your job down the road, it sucks having to continue paying for a sofa you bought a year ago. So when I really need to buy something costly, I always try to check the best of three offers before committing"
Cassandra Spykerman
30, actress and singer
"Identify what you spend the most on and work from there. I tend to spend a lot on shoes because I love them. I used to buy a pair a month, or every two months. Now, I just add them to my wishlist and treat myself once every four months"
Sandra Tok
49, business consultant, and mother-of-two
It’s important to make sure you are spending what you can afford (I usually use a debit card instead of a credit card for regular items to prevent overspending). When borrowing money for housing loans, it’s best to not borrow more than 50 per cent as the interest paid will erode capital gain
Diah Mastura
39, blogger at Etrangle.net, and mother-of-five
Start with small saving goals: For example, I try to save $10 a day. It works wonders! In one week, I saved $70, in a month, $300, and in a year, $3,600!
Anna Vanessa Haotanto
35, founder & CEO, The New Savvy
Before embarking on investments, there are some important questions to consider, ‘What happens to me and my dependents if this worst-case scenario happens?’, ‘How much am I willing to lose?’ and ‘What is the end goal?’ Exchange-Traded Funds (ETFs) are an excellent place when embarking on investments. They have low entry fees and are easy to understand and expose you to the stock market, bonds, and commodities. Of course, remember to do ample research and fully understand what youare doing before anything else
Estee Kho
27, self-employed
I have separate accounts for saving, and spending, and I limit myself to only using the spending account. This way, it is harder for me to overspend. And instead of paying my credit card bills monthly, I set aside a specific day each week to pay it off. Doing this prevents unnecessary finance charges and late fees
Jeraldine Phneah
29, account manager and finance blogger at Jeraldinephneah.com
To reduce shopping temptations, I have an ad-blocker so I won’t be exposed to marketing. I also don’t really follow influencers who promote a lot of products
TEXT: BAUERSYNDICATION.COM.AU / ADDITIONAL REPORTING: TAN GIN YEE / PHOTO: EVNATO / PHOTO OF CASSANDRA SPYKERMAN: THE PUBLICIST NETWORK
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