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There are many different ways you can choose to invest. Many investors make it a point to diversify their portfolio overseas to cushion their investments against local risks. But putting your money in places you can’t see also comes with its fair share of uncertainties, including foreign exchange fluctuations, taxes, and policies that you may be unfamiliar with. In this article, we outline some of the major drawbacks and benefits of investing globally to help you understand the key things to take note of before venturing overseas.   Spreading out local risks One of the biggest reasons why investors choose to invest overseas is to spread out local risk. Financial investments, especially higher investment types, can fluctuate according to the perceived risk in a country. Changes in governance, interest rates of short term loans, and even natural disasters can affect the value of your investments much quicker than you think. To mitigate such risks, investors often spread out their investments by putting their monies in a few different countries. This way, even if instability occurs in one country, you can still look to reap gains from your other investments from across the world.   Greater variety of assets and tools [...]

The constant evolution of technology and the global economic system has given rise to contactless payments systems. The manifestation of contactless payments systems was first seen during the golden age of capitalism post World War II when there was global acceptance of Visa and MasterCard as payment systems. Today, with the COVID 19 pandemic putting a halt to air travel and human interaction globally, we have seen cryptocurrencies gaining popularity especially with the ‘Bitcoin’ craze, and get rich quick schemes by ‘investing in cryptocurrencies. For most individuals, cryptocurrency means Bitcoin. However, it should be noted that there are more than about 4,000 different kinds of cryptocurrencies that are being circulated today in the blockchain (a database that stores chronological data to validate a transaction) that cryptocurrencies utilise to transfer coins to one another. In this article, we will simplify the concept of cryptocurrencies so that consumers are well informed on the risks involved whenever purchasing them and if it is worthwhile to even take up personal loans in Singapore to buy cryptocurrencies to make money.   What are cryptocurrencies? Cryptocurrencies are digital currencies that are stored by individuals in electronic wallets that enable them to send and receive payments to [...]

As a business owner, managing an SME (Small Medium Enterprise) is definitely a challenging task and can sometimes require extra financial help. If you’re looking to expand your business, funds are needed to keep your company afloat and in times like these, applying for an SME business loan in Singapore can be helpful for your enterprise. Some of the business loans in Singapore are government-aided specifically for SMEs to help finance their corporations. One of the most popular business loans for SMEs is a short-term working capital loan which is an unsecured business term loan in Singapore. This working capital loan in Singapore does not require any collateral and is offered by 17 financial institutions including established local banks such as DBS and OCBC Bank. Applying for a small business loan in Singapore can be daunting if you are a new start-up so it is important to know the details, eligibility and rates of the loan before applying for a working capital loan in Singapore. Here is an easy guide to SME business loans in Singapore for a comprehensive breakdown of the loan aid.    What You Can Get From an SME Working Capital Loan If you own an SME [...]

You’ve run out of cash and payday is still weeks away but you have bills to pay and are in need of some money. There are times when we get caught in this situation where a sudden emergency situation takes us off guard and we don’t have the required funds for it. In circumstances like these, loans can be of help if well thought out and planned. Loans, such as emergency payday loans from direct lenders, are popular for those who need cash urgently. However, this quick loan can come with many liabilities if not well-managed. Before looking for a payday loan in Singapore, it is good to find out all about them and compare a payday loan to other types of loans available.    What Is a Payday Loan? A payday loan is a short-term loan specifically made for urgent situations. It is a sum that is given to you before your payday, which essentially brings forward your income for the month. Typically, your next monthly income would be used to pay off this loan, hence its name. You can apply for fast payday loans online from a licensed moneylender that offers the best payday loans in Singapore. However, [...]

The exponential growth in Singapore’s economy since independence has not only made it a place of interest for established businesses, it has also garnered the attention of many new startups. With a huge influx of foreigners and the limited land space, Singapore has expectedly, grown to be one of Asia’s most expensive countries to live in. As such, it is often that we may see the ones around us or even ourselves, cash-strapped until the next paycheck or, stressing over an unexpectedly large bill/purchase. Here, we shall take a look at the most common types of loans in Singapore so that we will be able to ease off the financial strain caused by large bills or unexpected payments.    Fast cash loan Living in arguably one of the most expensive cities, it is a common occurrence to exceed our monthly spending budget, having to deal with some unexpected or overlooked payments. This may be a result of unexpected property damage or a vehicle breakdown. Such complications require urgent and almost immediate attention, which may undoubtedly cause a strain on our finances. Unfamiliar to most of us, the solution to our financial conundrum lies in a simple and direct fast cash [...]

Looking to borrow from a licensed money lender but afraid of the extra charges? Contrary to popular belief, it is actually illegal for a licensed money lender in Singapore to charge extremely high interest rates that are volatile. Licensed money lenders are verified under the Ministry of Law with regulated interest rates. Here are some of the misconceptions on the interest rates imposed by a licensed money lender that you should know about.   1. The interest charged can only be imposed on the remaining balance  The borrower should only be charged interest on the remaining amount that needs to be repaid. The computation of interest charged on the loan must be based on the amount of principal remaining after deduction of payment made. For example, if you take a loan of $20,000 and repaid $6,000, only the remaining $14,000 can be taken into account for interest.   2. There is a maximum interest rate imposed A money lender in Singapore can only charge a maximum of 4% monthly interest rate to prevent borrowers from going into debt paying rounds of hefty interest rates that never seem to end. This 4% cap applies regardless of your income and whether the [...]

Cash loans have played an integral role in the development and progress of most economies, even before the start of a global monetary system. It has since transformed to take varied forms, subdivided by certain financial factors that are important to understand and consider before we begin comparing cash loans in Singapore and, consider applying for any fast cash loans in Singapore.    Thousands of years ago, farmers used to borrow seeds to grow plants and pay them back at a later date. As one plant can produce hundreds of seeds, the farmer would then be able to return the initial seed along with another one which can be considered as the ‘interest’. That way, the farmer had access to abundant seeds and at the same time, he would’ve cleared his loan obligation. Since then, we have seen this model being adopted by most economies to a point where fast cash loans in Singapore are seen as a crucial driver of our society. Today, we have mainly two types of fast cash loans to understand, in order to ensure the wellbeing of our personal finance.    The first type of loan that we should be well aware of would be [...]

Looking for a legal loan in Singapore? If you are planning to make a big-ticket purchase to fund your dream wedding, a hard-earned vacation, redecorating your house, or perhaps an unforeseen medical emergency, you will need money, lots of it. Besides dipping into your cash savings or signing up for another credit card, are you looking for a simple alternative that can meet your needs?   No matter what your circumstances are, a personal loan is often an option many people consider for affordable loans. If you are new to loans, you might have a ton of questions. Read on to have your questions answered as we consolidate the top 3 frequently asked questions about personal loans and applying for one in Singapore.   What are the types of personal loans?   To start, you might be wondering how personal loans differ from a credit card and other loan options. A personal loan is an unsecured loan that does not require collateral. It makes it more available to the masses as people need not use their assets to secure a loan, posing less risk for them. Unlike credit cards that typically have higher interest rates, personal loans have a fixed [...]

The idea of taking a loan is often a topic individuals from a monetary conservative society might shy away from. However, it’s key that we all have a more accepting perspective towards the concept of borrowing, as it is just how most economies sustain themselves and reach financial success and freedom.    As we all are familiar with the basic understanding that a loan comprises both, a lender and a borrower, the technicalities of each type of loan existent within our society are countless. Let us discuss the 2 most common types of consumer loans in this article which are secured and unsecured loans and when would these loans be the most viable option in our daily lives.    The most common type of loan that most of us are familiar with arguably would be a home loan or a vehicle loan. These are known as secured loans, as the borrower pledges the collateral (in the case of the house or vehicle) against the loan. This is necessary as it lowers the risk incurred by the lender as they might possess the house or vehicle in the case of payment defaults. This enables the lender to provide the borrower with [...]

It is believed that loans have been an integral part of civilisations since 3000 years ago. Today, we can also see loans existing predominantly in most successful economies and we should not negate the importance of loan management, and understanding the technicalities of each loan type. In this article, we shall discuss some types of loans, and also look at some important factors to consider before applying for a short term or long term loan.   To begin, let us look at some of the requirements to acquire a loan in Singapore. For instance, to qualify for a housing loan, it's required that we have consistent income sufficient to furnish the loan every month. The existence of a collateral (house) would be the item or possession pledged against the loan. Hence if we do not oblige to the loan repayments, the financial institution may have ownership to the house. Since we all need a roof above us, the default risk (incurred by the lender) in terms of the defaults on monthly payments would usually be lower. These types of collateral-backed loans may impose lower risks on loan providers and hence the terms surrounding these loans can be flexible, and they [...]

This is the one of the most common topics we usually hear being discussed by adults and teens, often leading to stark disagreements. We have most definitely been on either side of the spectrum supporting either one of the schools of thought. With no clear or certain answer to the question, it is inevitable that the best solution to this paradox would be: to know when to spend and when to save. Below are some points that we can consider while deciding if we should hold back our expenses or splurge it all.   Let’s discuss this by putting into context the new variable affecting the global economy. With the rise in the number of COVID 19 cases globally, we have seen most countries adopting the orthodox solution of expansionary monetary policy, by providing their economies with large stimulus packages. This ‘stimulates’ the economy by increasing money supply, which would then lead to money becoming ‘cheap’(since interest rates are low) to encourage greater borrowing (due to the cost of borrowing being low) which would in turn lead to economic growth via greater economic activity as consumer expenditure (a determinant for economic growth) would increase. Hence, if we were looking to [...]

One of the biggest mistakes you can make when saving money or setting a budget is neglecting emergency costs. It’s one thing to calculate your regular expenses like groceries, rent, subscriptions and public transport, but you’re shooting yourself in the foot if you forget to account for the unexpected. Cars break down, roofs spring leaks and accidents happen – medical expenses, in particular, can be hard to deal with if you aren’t prepared with the necessary finances. It’s impossible to know when you’ll need to use an emergency fund, but there are so many reasons to start building one now. Why you need an emergency fund 1. You’re setting a budget Budgeting is a smart way to manage and protect your finances no matter your circumstances, but if you don’t account for unexpected costs you’re in danger of putting your bank balance in the red or facing financial ruin. 2. You’re the sole breadwinner Some couples and families get by on a single income, but what happens if you can’t work or lose your job? It’s particularly important for sole earners to build a fund they can rely on when surprise expenses arise. 3. You have a savings goal Whether […]

Most homeowners will agree that property is far from a set-and-forget investment. Houses and apartments age just like anything else, and we’re willing to bet you have a never-ending list of renovation ideas no matter the size or state of your home. There’s also the matter of maintenance and repairs, which are often impossible to predict and can leave you significantly out of pocket in what feels like the blink of an eye. Knowing how to cope with the cost of repairs and renovations will do wonders for your wallet and protect you from potentially life-changing financial difficulties. Expensive home repairs to look out for 1. Roof repairs Your roof takes a serious beating throughout the year as it protects your home from Singapore’s relentless heat and fierce thunderstorms. This makes it vulnerable to leaks, rotting and other damage, which can range from replacing tiles for a few hundred dollars to a full replacement costing you thousands. 2. Mould removal Mould can be a slow but destructive force in buildings, whether it’s a small buildup on visible surfaces or permeating through the entire structure. What can seem like an insignificant issue can cost a small fortune to remediate before major […]

The explosive rise of ride-sharing services hasn’t just been a game-changer for consumers. Singaporeans looking for a career change or a side hustle have flocked to brands like Grab in droves, snatching up the opportunity to earn some cash in a rapidly evolving industry. But what are the benefits and associated costs of driving for Grab, and how can you make it worth your while? The benefits of becoming a Grab driver The nature of ride-sharing apps has completely transformed how drivers operate, making it far easier for private citizens to sign up quickly and work flexible hours. These low barriers for entry contrast with traditional taxi services, effectively allowing drivers to be their own boss by choosing when and for how long they work. While some enjoy driving full time, Grab is equally suitable for those seeking a side hustle that brings in some extra cash to supplement their main job. Drivers can choose to take passengers, deliver food or do both, and can take advantage of perks like fuel rebates. As long as you meet the eligibility requirements for driving or delivering, you can get started in no time at all. Driving with Grab: Costs to account for […]

Dealing with financial challenges is par for the course when running a small business, even for the most well-equipped entrepreneurs. Keeping track of the expected costs is hard enough, but there are so many unexpected expenses that can catch you off guard. Navigating these costs is key to growing and sustaining a successful business, so it’s important to be as prepared as possible for any eventuality. Here are some of the most overlooked costs in starting and managing an enterprise, and what you can do if you find yourself short on cash 1. Registering your business You probably know that in Singapore, you can’t just throw up a sign and start trading on the spot. New businesses need to officially register via the Accounting and Corporate Regulatory Authority (ACRA) and pay a series of fees depending on the nature of the organisation. From reserving a name to obtaining the relevant licenses, costs can quickly accumulate before your doors have even opened. 2. Research and development Any successful enterprise needs to validate its core business idea. Research and development is crucial to developing a market-ready product or service, and many entrepreneurs are surprised by the amount they end up spending. Whether […]

We all like to pay for things out of our own pocket, but sometimes borrowing money is the most viable way to cover big purchases. From personal loans to business loans, it can be a suitable option when you need to invest more than you can feasibly take from your savings. Before you sign on the dotted line with one of Singapore’s licensed money lenders, you should always ask yourself a series of simple but important questions – even if it isn’t your first rodeo. The more time you take to properly consider your options, the more likely you are to set yourself up for success.   1. How much money do I need? It might sound obvious, but many people agree to a loan based on guesswork and end up with unnecessary debt. Avoid this trap by calculating exactly how much money you need to achieve your goal and be sure to factor in all relevant expenses. When buying a car in Singapore, for example, you would usually need to take the vehicle’s open market value and add Certificate of Entitlement (COE), excise duty, GST, registration and any other applicable taxes and fees. For more complex investments like starting […]

Cash flow is central to success for businesses of any size. Without capital to invest, profitability is little more than a pipe dream for entrepreneurs. As a result, business loans have become a key ingredient for fledgeling small and medium enterprises (SMEs) in Singapore, particularly those that don’t have the luxury of early backing from investors. A loan can be a crucial leg-up that funds critical infrastructure, property rental, inventory purchases or anything in between. There’s no single type of business loan in Singapore: rather, it’s a broad term covering a range of financing options with varying rates and terms. Since banks and other financial institutions offering these loans turn down a high percentage of applications based on insufficient criteria matching, it is vital to know how to secure the best possible chance of approval. Types of loans available to SMEs There is a huge range of loans available to businesses in Singapore with products varying between lenders. These include:   1. Unsecured bank loans General financing without collateral, able to be invested as you see fit, akin to a personal loan. Unsecured Business Term Loan Popular among many SMEs, it can fund anything, from equipment rental to office fit-out […]

We would all love to stroll down to the dealership and buy our dream car outright, but most of us simply don’t have that kind of money. Once you consider all other costs associated with owning the car you want – registration, insurance, road tax, petrol and maintenance – that price tag can make your eyes water. Getting the keys in your hand requires a significant investment and you want to get it right the first time around. The good news is there is a range of loans available in Singapore that can make your dream a reality. But before you hop into the driver’s seat, there are things to consider to make sure you get an affordable deal and avoid seeing your vehicle repossessed as a cloud of debt grows over your head.   Personal loans vs car loans: How do they compare? Individuals can consider two types of loans in Singapore to finance a new car: personal loan and car loan. A personal loan is money lent for general purposes, whether it be to pay for a holiday, a wedding or even a car. These loans are usually unsecured (no collateral), and those with a good credit history will […]

Household debt in Singapore reached S$317 billion in July 2020, highlighting how much our society relies on borrowed money to fund everyday necessities. Not all of it is bad: lending allows people to buy their first home, get a better education and invest in their future. But debt from unsecured lending like credit cards and personal loans can cause financial havoc if left unpaid, with high interest rates and overdue fees snowballing into mountains of debt.   What is a debt consolidation loan? A debt consolidation loan (or plan) is a repayment scheme that combines all your unsecured debt. The bank or financial institution providing the loan will pay off what you currently owe (outstanding debts and interests), allowing you to settle any pending late fees and start making a single monthly repayment to the lender. If you take out a consolidation loan for the first time, the lender will usually charge an additional 5% on top of the total loan requested to settle any unforeseen late fees and other incidental charges from your current creditors. Any unused money from this fee is refunded to you once the loan is repaid. There are several advantages to this type of loan, […]

The concept of borrowing money is simple enough: someone agrees to give you a set amount of money, on the condition you pay them back within a specified timeframe along with a little extra for their troubles. But there are many different types of loans, most of which can be divided into the two categories of secured and unsecured loans.   What is a secured loan? A secured loan is a line of credit provided to an individual or entity against an asset. This asset is known as security and can be something the individual already owns or that which they intend to purchase with the loan. The asset is often a home or car, but it can also be cash, savings accounts, fine art, jewellery and just about anything of worth that can be accurately valued. Security is used to provide peace of mind to the lender. If you default on your loan, the lender may be entitled to seize the asset in question and put it up for sale to recoup their losses. Because secured loans are less risky for lenders, they are able to offer larger amounts, lower interest rates and longer terms.   Common types of […]

Money is clouded by countless misconceptions, and it can be hard to distinguish fact from fiction, especially when it comes to borrowing. A personal loan, just like a mortgage, credit card or any other form of borrowing used by countless Singaporeans, is a common financial product that can be beneficial when used responsibly. Weddings, holidays, renovations, emergencies – life is full of moments that weigh heavily on the savings account, and a personal loan can be a great way to manage large expenses. They can also be used to consolidate existing debt and create a more realistic repayment plan moving forward. But there are many common myths about personal loans in Singapore, and it’s important to know your way around them before you sign on the dotted line.   Myth #1: You must have a fixed salary to be approved for a loan If the above were true, it would be bad news for many: there are more than 200,000 freelance workers in Singapore along with over 400,000 registered businesses, many of which are privately owned. But thankfully, those who do not earn a salary can still be approved for a personal loan. You will need to prove your income […]

While bankruptcy is something that needs to be taken seriously, it is not the end of the world and there are ways you can recover. It’s certainly something everyone wants to avoid, but it can be the circuit breaker you need to freeze snowballing debt, plan for a brighter future and protect yourself and your family. If you have been declared bankrupt in Singapore and want to take out a loan to start a new business or grow an existing one, there are some things you need to know before making your application.   What is bankruptcy?  Bankruptcy is when an individual owes more than they can pay. In Singapore, bankruptcy can only be declared if the debt exceeds $15,000 (this was temporarily increased to $60,000 until October 19 due to the economic impact of Covid-19). The aim of the bankruptcy process is to help creditors reclaim what they are owed while protecting the individual from complete financial ruin. You can voluntarily file for bankruptcy with the court, or a creditor may file on your behalf if they believe you cannot settle the debt. If you are declared bankrupt, the court will appoint an Official Assignee (OA) to oversee the […]

If you are thinking of taking out a loan, you’re at a stage reached by most people in Singapore at some point in their lives. Whether it’s to buy a first car or home, earn that dream university degree or cope with the cost of an unexpected emergency, borrowing money is often necessary to make those life-defining purchases and maintain financial stability. But before you begin making applications, your credit score is an important factor to consider. Your credit score is a four-digit number between 1000 and 2000 generated by the Credit Bureau of Singapore (CBS) to help lenders assess how likely you are to repay your loan. Depending on your score, you’ll be given a credit rating beginning at AA (best), BB and CC and so on through to HH (worst). First, let’s cover the basics.   How is my credit score calculated? CBS relies on an algorithm which takes a range of factors into account to calculate your credit score:     Utilisation pattern How much of your credit limit you use (i.e. whether you are restrained with spending or regularly max out your credit card)     Recent credit Any abnormal changes in the amount you borrow […]

When you start dealing with two or more forms of debt, it’s easy to start feeling overwhelmed. You need to wrap your head around the differences between loans and lines of credit, keep track of numerous fixed and variable interest rates, deal with varying repayment terms and somehow stick to your budget through it all. If you do start losing track, falling behind on repayments or facing the risk of snowballing debt, a debt consolidation loan can be an effective way to retake control of your finances and simplify your repayments. Debt consolidation can be suitable for those having difficulty managing their loan repayments, but there are plenty of common misconceptions that can make it seem more confusing than it is.   What is a debt consolidation loan? In essence, a debt consolidation loan is a repayment scheme that gathers all your streams of debt into one. The lender uses the loan to pay off other lenders you currently owe money to, including interest and any outstanding late fees or penalties. This process eliminates the confusion of multiple repayments, interest rates and conditions by bringing it all into one debt you can settle under a straightforward repayment scheme.   Myth […]

Becoming a parent is one of life’s most rewarding experiences, but it’s no secret that it’s expensive. Most couples aim to be as financially stable as possible before starting (or growing) a family in Singapore, and rightly so: money trouble is the last thing you need when raising a little one. Some of the costs of preparing for and raising a child are more obvious than others. For example, it’s likely you’ve already thought about the essentials you’ll need to start buying such as diapers, clothing and feeding supplies, as well as a crib or bassinet. But you’ll also need to tally up the totals for the numerous scans and check-ups you need to get during the pregnancy, not to mention the medical costs of caring for your baby once they are born. Once you add a stroller, carrier, car seat and all the other equipment you’ll need, the budget can start looking a little tight and you’d be forgiven for wondering where the money is going to come from. None of this should deter you from what is one of life’s most precious gifts, because it’s worth every cent to hold your baby for the first time and watch […]

Studying at university is a fantastic pathway to many rewarding careers, particularly in a country with such rich opportunities for students. Citizens, permanent residents and foreigners in Singapore have access to some of the finest educational institutions in the world, opening doors to jobs at the forefront of cutting-edge industries. But the cost of tertiary education remains one of the biggest hurdles for students in Singapore: fees for three-year general courses in 2020 typically fell between $25,000 and $40,000, even after taking subsidies into account. For more expensive courses like medicine and dentistry, students can expect to pay well over $100,000 in total. Though the price tags might be eye-watering to most, the accessibility of education loans and grants in Singapore makes it possible for students to earn a degree and build a successful career even if they can’t afford the costs upfront. And, for many of us, an education loan is the first type of debt we encounter in our lives. It presents an invaluable opportunity to recognise the benefits and risks of borrowing money and learn how to manage debt effectively.   Setting a budget and planning your repayments Many students who take on an education loan simply […]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings:   Small and medium-sized enterprises, or SMEs, are critical to Singapore’s economy. In 2019, SMEs accounted for 99% of all enterprises, employed 72% of the workforce and contributed more than $200 billion to the economy. While the numbers prove Singapore is a land of opportunity for businesses, they also highlight the intense competition. Entrepreneurs need to look for new ways to add value and cut costs on a continual basis, and it can feel like walking a tightrope to keep a business in the green. Cost-cutting strategies for modern SMEs 1. Outsource time-consuming tasks and functions There is a long list of tasks and functions that go into running a successful business, but not all of them need to be performed in-house. Marketing, accounting, payroll, website development and IT support are just some of the processes that can be performed by a third party as part […]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings: Planning for a wedding is an amazing journey to take with your partner, but it does take plenty of time and energy. The hope, excitement and raw emotion mixed with the long list of items on your to-do list can be a little overwhelming, not to mention the potential cost once everything is tallied together. Whether you’re happy to spend big on an extravagant ceremony or want to keep things casual to save on costs, it’s important to have a budget so you can track spending and keep expenses within your means. Even if you cut down on luxuries, it can be surprising how quickly costs can climb for a wedding in Singapore without the right preparation. Common wedding expenses to account for There are a range of expenses you are likely to encounter when planning your wedding, some of which are more easily avoided than […]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings:   Launching a startup is an exhilarating journey filled with hope, ambition and plenty of hard work. Singapore is no stranger to the highs and lows of starting a new business, with an estimated 55,000 startups calling the island home – nearly twice as many as a decade ago. The fact Singapore is a hive of startup activity should come as no surprise, given the country has ranked in the top two of the global Ease of Doing Business rankings since 2006. A deep talent pool, world-class infrastructure and universities, a robust economy and ample local and international trade opportunities all contribute to Singapore’s reputation for nurturing successful new businesses. Government support also plays a role, with a range of financing schemes and support programs that aim to propel startups to success and encourage innovation that may be too risky elsewhere. The challenge of securing finance It’s [...]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings:   Taking out a loan can be a useful way to deal with large or unexpected costs, but it’s important to be aware of common traps and how you can avoid them to protect yourself and your family. While the industry is regulated in Singapore to prevent exploitation of vulnerable borrowers, knowing how to compare money lenders and choose the right one will put you in the best position to repay your loan without any undue stress or financial strain. The difference between licensed and unlicensed money lenders First and foremost, you should only ever borrow from a licensed money lender. Licensed lenders are bound by the Moneylender’s Act along with other supplementary regulations which govern how they operate, including rules to ensure they can adequately manage risk, charge fair interest rates and abide by strict practices of debt collection. Unlicensed money lenders, also known as [...]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings:   Staying on top of your finances and maintaining steady cash flow isn’t always as easy as it seems. It’s one thing to keep your spending in check when everything goes to plan, but unexpected expenses can quickly throw your plans out the window. This is truer than ever in Singapore, where the cost of living is infamously higher than almost anywhere else in the world. Medical bills, car repairs and emergency home maintenance are just some of the many inevitable costs that are almost impossible to anticipate. If you do find yourself in money trouble and sweating over whether you can make it to payday, you may be considering borrowing money to help you stay on your feet. Payday loans can be a useful way to bridge the gap until your salary comes through, but it’s important to know how they work before you sign [...]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings: Singapore’s wealth of business opportunities comes as no surprise. The country has never dropped below second place on the global ease of doing business index since 2006, including a ten-year streak at number one from 2007 to 2016. It has thrived off the back of a highly developed market economy and a much-coveted AAA international credit rating. On paper, the numbers paint an attractive picture for those hoping to start or expand an SME business in Singapore, and a loan can be a great opportunity for entrepreneurs to inject the capital required for growth. Financing inventory purchases, buying or renting property, preparing to fulfil new contracts, investing in machinery and other infrastructure, hiring new talent - there’s no shortage in the list of reasons you might need a business loan. But before you start applying to borrow money from every bank and financial institution on the horizon, [...]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings: Should I take out a loan to pay for surgery? It can be difficult to cope with the strain of medical expenses in Singapore, whether it’s planned treatment or an unexpected emergency. It’s true that we benefit from one of the finest healthcare systems in the world – with schemes like MediSave, MediShield and MediFund, the country has previously been recognised as Asia’s healthiest and the world’s second-best for health outcomes. But access to first-class healthcare doesn’t necessarily come on the cheap, especially if you require surgery. Once you factor in the withdrawal limits of MediSave, limits and exclusions in any insurance policies you hold, and the generally high cost of living, it’s no wonder so many citizens and permanent residents find themselves in financial trouble when needing surgery. How much does surgery cost in Singapore? It goes without saying that the cost of surgery in Singapore [...]

Most of us are taught from a young age to “never a borrower nor lender be”. But as with many adages, this is an oversimplification. In fact, it can sometimes be imprudent wipe out your existing funds, rather than use a loan. Here’s when you should use a loan in place of your savings: The liquidity cushion, or “emergency fund” An important concept to understand in loans and savings is the liquidity cushion; sometimes called a rainy-day fund, or emergency fund. To explain this concept, let’s consider a typical Singaporean challenge: buying an HDB flat. In this example, we will consider a 50-year old man named Tan. Tan is 15 years from retirement, and has just sold his last flat. He has received $600,000 from the sale, a good price. Now, he wants to move into a new flat. He could apply for another HDB loan, but then he chances upon an internet article that says to avoid debt. The article tells him that, to minimise interest repayments, he should avoid taking loans and pay in full where possible. Tan decides to go ahead and spend all $600,000 on his new flat, leaving nothing to spare. A year later, disaster [...]

A common promotion you’ll find, especially in the holiday months such as December, is the “interest-free loan”. This may seem like the best deal when taking a loan, but don’t be fooled: the lender still has to be paid somehow (even advertising the loan costs money), and it’s not quite as free as you think. Here’s how it really works: What you need to know about interest-free loans: There are five important things to note about interest-free loans and how they work. These are: They are only interest-free for a given period There is still a fee, even if you are not charged interest If you’re buying from a shop, the interest may already be factored into the price It is possible for an interest-free loan to be more expensive than a loan with interest The “interest-free” loan on a credit card only applies to a balance transfer, not to everything else charged to the card They are only interest-free for a given period In Singapore, most interest-free loans have a six-month period. This means you are not charged interest during those six months. After those six months though, you will be charged the standard interest rate for any outstanding [...]

A common financial mistake is to try and live paycheque to paycheque. If you find that you’re always broke before your next payday, you’re not using your salary well; and while you can live this way for a while, a single emergency could derail your lifestyle and cause years of financial damage. Here’s how you should be using your salary responsibly: The four key elements of using your salary responsibly: Maintaining a savings fund Long term wealth accumulation, for retirement Keep your expenses low Using zero-based budgeting Maintaining a savings fund You should save 20 to 30 per cent of your monthly income, until you manage to accumulate around six months of your expenses. When you have a savings fund, you’re prepared for situations such as sudden retrenchment, drop in income, lawsuits, inability to work for medical reasons, and so forth. A savings fund ensures that you won’t fall back on your various obligations, such as outstanding loans, your mortgage, your insurance premiums, etc. This will prevent situations like losing your house to the bank, or ending up uninsured. Another advantage of a savings fund is that it reduces the need for loans. While there are many loans available for [...]

30 is a crucial age for many Singaporeans, financially speaking. This is the age when many of us buy our first house or car, or settle down to raise a family. Also, this is the age at which some of us start looking after our aging parents. As such, there are important money milestones to aim for at this crucial age: 1. You should have sufficient funds for your first home, in either savings or your CPF How much is enough for your first home? Well, that depends on what sort of house you buy, and whether you use a bank loan or a HDB loan. For reference, we’ll consider a four-room flat that costs about $350,000 today. This is a typical amount faced by many Singaporeans. Using a HDB loan, you can borrow up to 90 per cent of the flat’s value. This leaves you with a down payment of $35,000. This money can be paid in cash, from your CPF OA, or a combination of the two. If you use a bank loan*, you can only borrow up to 75 per cent of the value. This means you need to fork out $87,500 for the down payment on [...]

With good money management, you should always be able to repay your loan on time. But this is an ideal – sometimes, situations such as multiple emergencies (e.g. job loss coupled with serious illness) stop us from making the needed repayments. If you’re in such a situation, here are some quick steps to take: Contact the lender as soon as possible The worst thing to do is “play dumb”, and ignore calls or warning letters. The reason is that loans compound over time. The longer you wait, the worst your debt will become. For example, if your loan has an interest rate of 26 per cent per annum – a typical rate for a credit card - it only takes around 2.7 years to double your debt. (Note: to estimate how long it takes to double your debt, just divide the interest rate from 72. For example, an interest rate of nine per cent per annum would double your debt in 72 / 9 = 8 years). The sooner you address and try to repay your debt, the smaller the amount you have to deal with. It’s much easier to tackle your debt when it’s $1,000, than when it’s snowballed [...]

When it comes to multiple streams of income, many Singaporeans prefer it. But we don’t act as if we need it. The typical Singaporeans is quite content to rely on a single employer, to meet all their financial aspirations and goals. However, this isn’t just limiting – it can even be dangerous. Here are some things to consider, regarding multiple income streams: First, what do we mean by multiple streams of income? A stream of income is a reliable and consistent source of money, that can carry on indefinitely. Some examples include: Perpetual income bonds, which pay out bond coupons and never mature Rental income from properties that you own Dividend pay outs from your stock portfolio Annuity insurance, which pays out a fixed amount from a certain age (such as 65) till your death Extra income from running a side-business, or multiple business ventures Royalties from something you’ve created and copyrighted, such as a song or book you’ve written, or for the sale of a product you invented A second job As you can see, there are many different ways to get streams of income. However, they all share some things in common. All of the above income streams [...]

The election in Malaysia has all the makings of an epic event – a man over 90 returns to politics, to fight against the corrupted party that he once established. We’d be surprised if no one is calling the movie rights to this yet. Amidst the drama however, some voices of concern have arisen: what does this mean for Singapore? Five ways PM Mahatir Mohamad’s victory could impact us Possible impact on property prices in the Jurong region Potentially tighter compliance issues for banks A potential return to an adversarial relationship His intended replacement, Mr. Anwar Ibrahim, bodes well for us This has probably improved long term, regional stability Possible impact on property prices in the Jurong region PM Mahatir is re-examining some of the major deals and infrastructure project, that were passed under his predecessor. One of the key deals is the High Speed Rail (HSR), which was meant to connect Singapore and Malaysia. The terminus of the HSR was to be in Jurong East, and this caused a rush for Jurong region properties. Even now, developments such as Le Quest are selling like hotcakes, on the presumption of the HSR being built. Due to the large number of […]

A Professor of Economics at UniSIM, Walter Theseira, caused an uproar recently at the President’s call for policy suggestions. He mentioned that CPF use for housing should be curbed, which is a sore spot for many Singaporeans. Most of us are already worried about rising home prices; if the CPF were truly curbed for housing use, how could we afford it? Here are the likely consequences: First, we need to understand how CPF is used for housing Singaporeans can use their CPF Ordinary Account (CPF OA) for housing in the following ways: Making the down payment onthe house Paying certain stamp duties and fees Servicing the monthly mortgage repayments Making the down payment on the house The Loan-To-Value (LTV) ratio determines how much of your house can be financed through borrowing. For example, if you have an LTV of 80 per cent, then you can borrow up to 80 per cent of the purchase price or valuation of your house, whichever is lower. For example, say you want to buy a resale flat, that costs $400,000. The official valuation of the flat, as conducted by HDB, is $390,000. The bank is willing to grant you an LTV of 80 per […]

Are you thinking of leaving the rat race and starting your own business? After all, running  your own business can offer a number of advantages – higher income potential, no nasty bosses to deal with, working in your own time and even the likelihood that you can work while travelling. That said, starting out on your own is obviously not easy; this is one reason why so many people would rather be an employee than an employer. Out of the many obstacles, coming up with the capital to finance the business is a huge one. Other than just the capital, businesses may also meet with financing needs throughout the lifespan of the business. Whether you opt for a bank loan, crowdfunding or using invoice financing, each of these sources of financing has its own advantages and disadvantages as well as criteria they will use to evaluate your business. Here’s an overview of 7 common sources of financing for new businesses: Personal savings Most business-owners start out using their own savings. While this entirely makes sense, it may not be the wisest thing to do. However, this can be risky since you stand to lose all of your money. It may […]

For most of us in Singapore, our first encounter with debt could be the small amount of money we’ve borrowed from a close friend when out allowances fell short of an impulsive splurge. While that’s nothing serious, it could be the basis of a bad habit that could affect your life ahead negatively. In terms of official debt you are likely to encounter in your twenties, it might be the study loan you had to take in order for you to get through tertiary education. It can also be that first credit card you’ve so happily applied for and is now having some difficulty to repay. Whichever it is, it’s good to realise your mistake now rather than later. If you are currently in debt, read on to find out what mistake you could be making and seek to rectify them before it is too late. Not taking debt seriously “What’s the problem of owing the bank some money? What can they do to me?” You may not see the effect now, but do you know that every bad debt you have goes into your credit report? (Credit Bureau Singapore)is the organisation that aggregates credit-related information amongst participating financial institution […]

Maybe you are just not the kind to have excess money sitting in your bank account. Well, what can you do when you earn barely enough to cover your monthly expenses? If that’s you, you might want to think about setting up a budget and saving for emergency purposes. But for now, you are short of cash and payday is 1 week away, what can you do? Cancel all social engagements If you have scheduled a number of social engagements such as dinner and drinks with friends or had planned to catch a movie, its time to cancel them. Going for social gatherings often include spending money and in a more extravagant manner as well, so if you are already short on case, you should avoid them as much as possible. Anyway it could work if your friend doesn’t mind paying for you first. Plan your meals ahead You can cut out on the extravagant stuff in life, but you can’t survive without food. If you know that you are going to be short on cash the next week, it’s time to set about planning your meals. Eating at a hawker centre or relying on some home-cooked meals can greatly […]

Buying a house is probably one of the biggest expense you will incur in your life, but it is also a source of pride for many people. So if you’ve just bought your first home, congratulations! Your next step is likely to be browsing through the beautiful pictures of home renovations and deciding on how you want the home of your dreams to look like, but you also know you are constrained by budget, so what can you do? Whether you are buying a resale HDB, an old condominium or a new Executive Condo, some form of renovation will usually be required. However, there’s always a way to keep cost low if you are cost-conscious. How much would I expect to spend? If you have bought a resale HDB, renovation cost will be on the higher side, typically ranging between $30,000 to over $50,000. For new BTO, you can expect between $15,000 to $50,000. The amount can seem a bit much, especially when you’ve just burned a huge hole in your pocket with the downpayment you’ve paid for your flat. However, you also want to do the renovations before you move in so that you do not have to deal […]

More and more people are taking the risk to start their own businesses in Singapore. Starting and running a business in Singapore is not an easy task. Other than having to deal with global economic uncertainty, getting the right credit to fund your business can be challenging as well. Taking up a business loan is quite a different thing from a personal loan. What’s more, it’s likely to be something quite unfamiliar to you, which can easily cause certain misunderstanding. So before you go ahead to look up a business loan, here are 5 myths that we are debunking to ensure that you are on the right path. Myth #1: It’s hard to get funding for a small business All lending institutions come with their own set of credit checks before they disburse any loans. This applies to every type of business, big and small. In fact, they may think twice about lending to a large company since the risk can be higher. Many lenders, including legal moneylenders, are more than happy to lend money to small businesses if they can prove their credit-worthiness. Myth #2: You can only get a business loan from a bank Similar to personal loans, […]

Do you find that you spend a huge amount of time online, shopping for things to buy even if you didn’t want to purchase anything specific? Do you find yourself walking the aisles of shopping malls after work or over the weekend, mindlessly spending on little items that you don’t really need? You could be suffering from compulsive spending. Compulsive spending may not always be the extreme situation where you can’t control yourself from spending everytime, but it could be the start of something if you find it becoming a habit. Here are some common signs of a compulsive spender and some effective ways to help you curb those urges to spend excessively: A closet full of clothes you’ve never worn, gadgets you’ve never used and books you don’t read Spending money when you’re feeling lonely or depressed. Spending money on things you don’t really need often. Feeling excited when you buy something new, but guilt soon follows Lying about how much you spend. Continuing to spend even if you can’t quite afford it. Feeling ashamed about your shopping habits. Fighting with your loved ones over your spending habits. Hiding purchases and spending habits from loved ones. Taking out loans […]

To achieve financial freedom seems to be a life goal shared by many, though not many are able to achieve it. While money itself can’t bring you happiness, it can be an effective means to an end, enabling you to live the life you want. While we aren’t going to promise you financial freedom just by reading this article, we’ve proposed 7 steps in which you can take to move you towards financial happiness. Learn to budget Budgeting is probably one of the most basic yet effective way to help take control of your financial situation. Tracking your finances as a first step will give you a clear idea of how much you are spending per month and what you are spending on. The next step will involve figuring out how much you want to save per month before allocating the rest of the money to different categories of expenses. This would typically include fixed expenditures such as rent, payment of any outstanding debts, utility bills, telco bills before setting up your food and entertainment budget.   Repay outstanding debts Having an outstanding debt can hinder you from achieving financial happiness because the interests that you’d need to pay is […]

Most businesses would require financing at some point in their life cycle, whether that’s to get capital to get the business started, to push through a rough patch or finance an expansion. There are many options out there to provide the cash even if securing the money doesn’t always come easy. The variety of financing choices can be bewildering, with different costs involved and how it works. In fact, choosing the right financing isn’t always about getting the cheapest loan/credit, but it depends on your individual needs. If you are thinking about borrowing money for your business, you should have a pretty good idea what it is for. While most businesses might go straight for a business loan, it’s not always the easiest way to get an approval. In fact, the old-fashioned overdraft was a way our parents’ generation had used, more often than not. An overdraft is still considered a significant method of short-term financing for many businesses. It is a credit facility attached to a transaction account from the lending institution. Usually, we can only make a withdrawal when there is still money in the account. But for an overdraft, the business can continue to withdraw money or […]

Credit cards and personal loans are pretty similar in their purpose. They are both types of credit that require a monthly repayment. However, they can differ substantially in their features and fees charged. This is why it is important to consider how you want to use them in order to choose the best one suited to your needs. Credit cards are great for ad-hoc payments which you can pay off by the end of the month so that you can take advantage of the interest-free days. They also make a good financial tool to have for times where you need cash urgently since you can use cash advance to help you in emergency situations. In Singapore, credit cards are pretty popular because they offercardholders attractive benefits like cash rebates, discounts with partner merchants and even allow you to earn air miles that you can exchange for free flights. With the stiff competition around, it is not uncommon for banks to offer cash vouchers and sign-up gifts as well. On the other hand, most borrowers only take up a personal loan when they need it. Due to the fact that you’d need to pay interest once the loan is disbursed, it […]

There are essentially 2 ways to have more money – either you save more from your existing salary, or you can try to increase your income. While asking for a pay rise may not always be feasible, you can always look for side gigs that can earn you some extra allowance. Whether it is to clear off your debt faster or simply wanting to put aside more money for a rainy day, there are dozens of ways to make earning extra money painless, and even an enjoyable process. The key is to find something you like to do and turn it into an income-generating side income. If you have some extra time on hand and want to make some money instead of wasting your time in front of your TV, here are seven ideas for you. 1.    Sports instructor Do you already do sports after your work every other day? Or are you a yoga-obsessed person who does yoga almost every day? If sports is your religion and you are pretty good at what you do, why not consider getting yourself certified and teach what you love? In fact, there are even certain sports activities where you don’t need formal […]

In 2014, a businessman borrowed $350,000 from a licensed moneylender at an annual interest rate of 240%. Although he managed to pay back twice the amount of the original loan, the man was taken to court by the licensed moneylender for failing to pay the entire owed amount. Fortunately, the case was thrown out by the court and the ministry of law has since ruled that the maximum interest rates moneylenders can charge to 4% per month. The case also highlighted the fact that while you can have alternative options to borrowing from a bank or an illegal moneylender, it isn’t necessarily trouble-free. When done correctly, borrowing from a licensed moneylender could be a good solution to your cashflow woes. If it’s your first time seeking a loan from one, here are some steps to follow: 1.    Understand the fees payable When looking for a loan, many focus only on the interest rates they will be charged. Fees can also add up to form a significant part of your payment. The good news is that since licensed moneylenders are regulated in Singapore, there are only certain types of fees they can charge, including the following: a fee not exceeding $60 […]

If you’ve come into 2018 bringing with you debt from last year, one of your new year resolutions could be to pay off the debt by the end of this year. But you know as what many say, “fail to plan and plan to fail”. The same goes to paying off your debt – have a solid plan that you follow religiously and Viola! You’d find that you’d cleared the debt easily. The problem is most people may not know how to go about planning their finances, giving in to living day-by-day and month-on-month, to find that at the end of the year, the debt they have just increased even if they have been making the minimum payments. If you belong to this class of debtors, it’s time to buck up your game and use these 5 tips to help you reduce debt effectively. 1. Fix an amount to pay each month The way to clear your debt fast is to make it a priority. Instead of waiting till the end of the month to use what’s left in your savings account to pay down your debt, do it the first thing your salary comes in. This will help instil […]

While it may be possible to live completely debt-free, it’s not always the smartest decision. Much like how big companies take on loans in order to expand their businesses, taking up the right type of debt not only helps you better manage cash flow, it can even help you make more money in some cases. But we also know that a loan, when not managed properly or used for the wrong reasons, can cause some dire consequences. Therefore, the most important consideration when taking out a loan is whether the debt incurred is good debt or bad debt. Difference between good debt and bad debt Good debt is defined as money borrowed to pay for items that will grow in value or generate long-term income. Taking out a study loan to pay for a course that can upgrade your skills in this ever-changing economy is the perfect example of good debt. This is because the skills that you’ve learnt will likely help you towards getting a better job or a higher pay in the future. – it is an investment in yourself. Thus, before you think of taking up any loan and incur the cost of it, it’s best to weigh it out […]

Do you know that Singapore possess the highest debt-to-GDP ratio in Asia? Put it in simple terms, the country borrows a lot of money. Are we,however in a crisis? Interestingly, no. Singapore has always gotten a high credit rating from credit rating agencies – the reason is that the money is borrowed to invest, not spend. This is unlike many civil debtors, who typically borrow to spend. And this is exactly why we get into trouble. While having debt isn’t necessarily something bad or shameful, it can quickly get out of hand when you’re not careful. So if you’re unaware of whether your debt situation is out of hand, here are 7 warning signs to look out for before you seek help. Credit rejection If your recent loan application or credit card application has been rejected, it could be due to your credit score. Banks and lenders typically pull out your credit record to check your probability of default before they disburse a loan to you. A weak credit score predicts that someone is likely to default. If your loan application was rejected, it could signal that you have too much debt under your name or you have some unpaid […]

Some of us may have found ourselves in unenviable financial positions before, and Andy was precisely caught in one such situation. Having taken on the onus of funding his younger sister’s new business, he had unfortunately had to pay for his wife’s medical fees for a small operation. As a brother, Andy found it hard to back down from his promise to his sister in helping her with the capital to start off her import/export business. Yet, his wife, who is fully dependent on him, will need his help in paying off her medical fees. Though the operation cost about $12,000, it is still going to make a huge dent in his savings, not to mention he still has a 4-year old son to take care of. Are you one of those who has considered applying for a personal loan but was reluctant due to some misconceptions? The fact is a personal loan can be used wisely to help with short-term cash flow problems, freeing you from a shortage of funds; it can also be abused by someone who would use the money unwisely, ending up in accumulating more unnecessary debt. You might associate taking up a personal loan with […]

While most of us would prefer to cruise through life without having to take up a loan or credit, that’s not really realistic unless you were born with a silver spoon in your mouth. The truth is that most people end up taking some kind of loan or credit in their life, but some, seem to get it easier than others. If you are one of those who has unfortunately been rejected for a loan, the first thing you need to do is to figure out why, and either tackle the problem head on or seek alternative financing solutions. Here are some common reasons why your bank loan was rejected, and steps to take to get the loan you need. Common Bank Loan Rejections 1.    Bad Credit History Banks in Singapore have access to your credit history via the Credit Bureau Singapore(CBS). Your credit gives a summary of your credit repayment capability. The credit report enables banks and other financial institution to make better lending decisions when you apply for credit and loans. It is therefore important that you maintain a good repayment record. Non-repayments or overdue repayments will be reflected in your credit report and has the potential to […]

Perhaps you’ve always paid your bills on time and have never taken any loan before – you might be surprised if your first personal loan application got rejected. There can be many reasons for your loan rejection. While the lender may not provide you with a reason, the stated reasons below can help you get an inkling of why it happened. Possible reasons for a loan rejection 1.Bad credit history – perhaps you’ve had some late payment records but you’ve paid them off years ago, so how can they still affect your loan application? Sadly, they can. The credit bureau in Singapore keeps a record of all your different defaults and late payments across their partner banks. If your lender pulled out your record and felt that you make a good candidate for potential defaults, then you’d most likely not get the loan. What you can do – consider buying your credit report to check if the information reflected is correct. If you’ve had some bad credit history, fix the records by ensuring you are paying on time. If not, you can consider a loan from a legal moneylender which uses a different credit bureau for assessment. 2. Not meeting […]

According to Mercer, a global consulting firm’s Cost of Living Survey, Singapore ranked number 5 in the world’s most expensive cities for expatriates. Although one living here may find that daily living costs such as food and transport really doesn’t cost much, costs of housing and having a car ranks as one of the most expensive in the world. And with more than 90% of Singaporeans being home-owners, it is little wonder that many of us have outstanding debts, at least a mortgage loan. While not all debts are bad, is there a way to live here without taking on unnecessary debts? Household Liabilities Source: Singstat As you can see from the above graph, 75% of our household liabilities come from mortgage loans, but there is still 25% coming from personal loans. While the amount of personal loans we take on has definitely dropped significantly from the years of 2011/2012, there was a minor spike at the start of 2017. Since January 2018, the new Credit Limit Management Measure will cap the additional unsecured credit that a financial institution can lend to a borrower whose outstanding unsecured debts exceed six times his monthly salary. While the government has done its […]

When we need extra cash, many Singaporeans may prefer to use their credit card instead of opting to take up a personal loan. With the ease of getting a credit card, it’s no wonder this is an easier option. However, there are situations where credit cards just won’t work and taking out a loan looks like a smarter option. Here’s a look at how 4 types of people can benefit from taking a personal loan instead of using their credit card when they need some extra cash: 1.    Entrepreneur More and more Singaporeans are attracted by the prospect of being their own boss and the flexibility entrepreneurship offers. But starting out on your own can be tough, not just to raise capital, but also to keep business operations in order. Small businesses will benefit from having cash to keep cashflow in order, hire new staff and expand operations. But the problem is it is difficult to get a business loan for a small business, so a personal loan could work in such a situation. While your business loan may come at a lower rate compared to a personal loan, the minimum amount to borrow may be higher, which can result […]

More and more Singaporeans are open to the idea of setting up their own company. Not surprisingly, the lure of a more flexible work arrangement, ability to be autonomous and the pursuit of more money are attractive reasons for Singaporeans to become entrepreneurs. But we also know that becoming a successful entrepreneur requires much hard work, guts and most of all, resources. Having the capital to start your business is one thing, but along the way, you might realise that you need more money to sustain the business. This is when a business loan can be helpful. While some may remain conservative and frown upon the idea of taking a loan, having the money can certainly help small businesses ease cashflow problems and stay in the black. Now, it might not seem like a good idea to go into debt the minute you have cash flow problems, but there are actually five excellent reasons why a business loan can be considered good debt and good for the business in the long-term: 1.       Tide over unexpected expenses No matter how we try to plan and anticipate our business expenses, there are bound to be times where the unexpected can happen. A […]

Having a bad credit score can hurt your loan applications especially when you are applying for one from a bank. Unfortunately, there’s little you can do within a short period of time to erase those bad credit records, but if you need money urgently, there are alternative sources of finance you can consider. Here are we 5 ways to get the money you need. Licensed Moneylenders Most people may frown upon the word “moneylender”, equating them to the illegal ones who often see on TV and confusing them with loansharks. In Singapore, legal moneylenders are licensed by the Ministry of Law and have a number of strict criteria to fulfil. Before you seek out a loan from a licensed moneylender, you should however, verify that they are truly licensed. Legal moneylenders need to adhere to a maximum interest rate limit, and they operate with a different credit bureau, which gives you a higher chance of getting a loan approved. The Moneylenders Credit Bureau(MLCB) is a repository of information on all loan applications and repayment records with licensed moneylenders in Singapore. So if you have any previous default or late payment with a moneylender, your loan can still be affected. It […]

Credit cards often get a bad rep but they can really work to your advantage if you are savvy and responsible in the way you utilise your cards. Having good credit card habits (e.g. paying your bills in full punctually every month) is instrumental in making sure that you stand to benefit most from what they truly have to offer. Still not convinced? Check out the five ways credit cards can help you save money below. We guarantee you will see credit cards in a different light going forward. 1. Some cards give you cash rebates Nobody would say no to getting cash rebates on their spending. How much cashback you can earn depends greatly on the credit card you hold. You can expect to save on things that you were already going to spend on if you use the right credit card when making payment, such as a cashback credit card or a rewards credit card that lets you redeem your points for cash rebates later on. 2. You can redeem rewards points for lots of things There are plenty of rewards credit cards on the market for good reason. While not all credit cards are made equal, rewards […]

Many of us may not think much about our credit score until the day when our loan/credit application is rejected. A credit score is a number used by lenders as a gauge of how likely one will repay his debts and the probability of going into default. It is an independent assessment of the individual’s risk as a credit applicant. It is thus important because it can affect the cost of your loans and whether the loan gets approved. How credit bureaus work Credit Bureau Singapore(CBS) was launched in 2002 as a private company owned by the Association of Banks in Singapore and information management firm Dun & Bradstreet. CBS collects information from members such as banks and financial institutions, as well from publicly available sources such as bankruptcy records. It includes your personal data, loan repayment history, closed accounts, credit card balances and credit limits. Banks will then use the data and credit scores to gauge whether they should lend you money, extend a credit line or charge you higher interest on your loans. Since most people will probably need to take a loan sometime in their life, be it a study loan, personal loan, credit card or mortgage […]

Because of the idea that people in debt do not go to jail, many people feel that it is okay to leave their personal loans to stew and earn interest because they feel that they cannot afford to pay it. In reality, when you do not pay your personal loans, you are opening yourself up to a bigger problem that will affect the rest of your life. To give you an idea of what you can expect, this is what happens when you do not repay your personal loan. Reason Why We Get Personal Loans A personal loan is significantly different from a specialized home, car, and business loan from the bank. A personal loan is riskier because the bank does not have definitive proof that the loan is meant to earn money, unless you say so. Even then, they will ask for collateral in case you fail to repay your personal loan. When you do not repay your personal loan, it means you are defaulting. What Are the Consequences When Defaulting Your Personal Loan First off, the bank is dealing with thousands of people who have defaulted their personal loans. You are not really an important target for their […]

When you take up a loan, it can be a secured or unsecured loan. A secured loan is when a borrower pledge his assets as a collateral for the loan, such that the lender has a kind of security/guarantee against the money he lent. On the other hand, taking an unsecured loan does not require any guarantee, but typically comes with a higher interest rate because of the risks the lender is taking. Some examples of secured loans include car loan and mortgage loans, whereas an unsecured loan includes personal loans, study loans and credit cards. While most borrowers typically look out for a loan that charges a lower interest rate, there can be other factors that you should consider as well. This includes the eligibility criteria, fees and charges additional to the loan, minimum loan tenor and prepayment penalties. Understanding Interest Rates Interest rates can be confusing because what’s advertised may not be the actual amount you are paying. One tip for borrowers is to always look out for the effective interest rate. The Effective Interest Rate takes into account the compounding effect of the frequency of instalments. The more compounding periods there are, the higher the interest.  Licensed […]

At some point in your life, you may face a situation where you need urgent cash or a fast loan. During such circumstances, you may resort to taking a loan from a moneylender instead of a bank due to various reasons. The great thing about taking a private loan is that Singapore has legalised moneylending. This means that licensed moneylenders here have specific rules to follow if they want to continue to be in business. This also helps to protect borrowers against unlawful lenders who charge exorbitant interest rates and who could cause unnecessary trauma while collecting debts. It is thus extremely important for borrowers to know the difference between a licensed lender and a loanshark so that they do not get scammed and put themselves in danger. Here are 6 ways you can tell a legitimate moneylender from an illegal one:   1.    Licensed Moneylenders are registered with the government A really quick and simple way to check if the moneylender you are dealing with is a legal one is to check the government listing for registered moneylenders. You can easily access the link here. 2.    Loansharks do not operate in a physical office Most borrowers are very savvy […]

You do not have to steer clear of credit cards completely just because you aren’t sure how make them work hard for you. Some credit cards are designed to make things easy for consumers like you and I, while others on the market are fraught with complex series of hoops and challenges when it comes to letting cardholders earn and enjoy their rewards. Are you just getting started with credit cards? If so, you might want to consider the following three cashback credit cards we’ve rounded out for you. They are some of the most, if not the most, straightforward credit cards in Singapore. 1. The American Express® True Cashback Card The American Express® True Cashback Card is a fuss-free credit card that rewards you with a flat rate cashback on all your purchases, no matter whether you are spending on groceries at the supermarket, dining at restaurants or booking holiday travels online. This credit card lets you earn 1.5% cashback on literally everything under the sun and your cash rebates earned in a statement month will be automatically credited to your account in that particular statement month as a statement credit to offset your credit card bill. If you […]

It can be a daunting experience to face retrenchment. For those without much liabilities, they may welcome the small break they will get before getting the next job. But for others who have a mortgage loan to service and mouths to feed at home, they may feel dejected and depressed. For those who are stuck in shock, it isn’t the best time to take care of their financial matters since they may not act rationally. But in order to keep things going and put everyone at home at ease, a review of the current financial situation has to be done. Here are some of the common mistakes you need to be aware of. 1.       Sell all your investments It may seem like a very logical step to sell all your investments in order to liquidate your funds. These include existing money in equities, funds, ETFs, investment-linked policies, endowment… you get the drift. But we also know that when you make an investment, the predicted returns are based on liquidating them only upon maturity. This is why you may want to take time to look at what you should and should not liquidate. For instance, cancelling your investment-linked policy may not […]

Looking to get your first credit card but not sure what to expect? Credit cards are different from debit cards from the way they work to how rewarding your experience can be. When used right and responsibly, you will be surprised how much you can save from using credit cards instead of debit cards or even cash. To start you off, here are some basic things about credit cards you ought to know before you rush off to get your hands on one. 1. How It Works When you use a credit card to pay for your purchases, you are essentially borrowing from the card issuing bank right from the moment you swipe your card. Whether or not this borrowing comes at cost depends on whether you pay your credit card bill in full and on time. With credit cards, the bank offers you a line of credit that you can use to pay for things first but as with all things borrowed, you will have to return the bank the amount you owe (i.e. the amount you have charged to your card). As long as you pay your bill off punctually in full, you will not incur any interest […]

Licensed moneylenders often face a stigma from borrowers – some people may view them with suspect, and wrongly associate them with illegal moneylenders or loansharks. Licensed moneylenders in Singapore is actually very well-regulated and have a strict set of rules to follow regarding who they can lend to and how much interest they can charge. You must be thinking, “If I can borrow from a bank, why would I go to a moneylender?” The fact that they exist justifies that there is in fact a segment of demand that they fulfil. You may have recalled an incident where your credit card was rejected by a bank; and you might have gone to another bank to apply for a card. A personal loan here works similarly – think of someone who may not qualify to borrow from a bank but need cash. In this case, the legal moneylender offers a viable option. In fact, there are a number of key differences between taking a personal loan and a bank. Let us take a look and we’ll let you decide which is more suitable for you. 1.    Loan amount Most banks in Singapore require you to borrow a minimum amount and to […]

Most people avoid borrowing if they can; after all, who wants to be in debt? There are in fact, legitimate reasons to get a personal loan. Not all who take out a personal loan are those who over-spend on their credit cards or have a gambling debt to settle. Picture a scenario here – Alex works as a technician and earns a salary of $3,000. He supports his wife and has a baby who has just turned one. With his salary, he is still able to save about $200 a month. Unfortunately, Alex met with a road accident while he is on his motorbike. Luckily for him, he is able to get away with a small injury, but he needs to take some time off work and has no insurance. Although his Medisave can cover some of his hospital bills, he still needed to fork out $2,000. Together with the lost income, he will need a small sum of money to tide him over this tough period. A personal loan could definitely help him here. There are a number of legitimate life situations where a personal loan can be of great help. Be it a personal loan from a bank […]

Are you intending to take your first step into the world of credit cards? Before you succumb to pressure and sign up for any random credit card there is at roadshows at the shopping mall or MRT station, it pays learn about the basics of credit cards we have in Singapore and what they have to offer to potential cardholders like yourself. Read on ahead and you might just figure out which type of credit card is more suited for your needs and lifestyle inclinations. 1. Cashback credit card As its name suggests, a cashback credit card gives you cash back on your spending. Think of it as a discount on practically all of your purchases. Some cashback credit cards are fuss-free to use in that it offers a flat rate cashback (e.g. 1.5%) on all your purchases with no minimum spend and no cap on how much cash back you can earn. On the contrary, those cashback credit cards that offer enticing cashback rates (e.g. 5%, 6%, 8%) usually require you to spend a minimum amount per month, say $500, before you are eligible to earn cashback at those high rates. 2. Air Miles credit card Air miles credit […]

Whether you’ve got an unexpected bill to pay or you’re short on this semester’s tuition payment, you need to find a source of cash quickly. In your search for a quick loan, you’re going to find both payday loans and personal loans. But what types of loans are these and is there a real difference? In this article, you’ll get a quick rundown of each one to help you determine which option makes the most sense for you. Payday Loan A payday loan is a relatively small, short-term loan offered by a legal moneylender. It carries a high interest rate and needs to be paid back in a matter of days or weeks, usually whenever your next paycheck is due. The amount you can borrow has to be less than the amount of your next paycheck which means you can usually only borrow a few hundred dollars. It’s sort of like getting an advance on your next paycheck and the advantage of that is that you don’t have to go through a credit check. You just need to bring some payslips with you to provide proof of income and show when you can expect your next paycheck. This is the […]