We could all do with a little more in the bank every month, especially when times are tougher than ever and the economic outlook remains bleak. Combined with the threat of inflation and ongoing supply chain issues, and a GST hike in 2023 to 8 per cent from Jan 1, 2023, suddenly everything looks so much more expensive.
Short of taking up more side gigs, one way to ensure you stay in the pink of financial health would be to amp up your savings. By making these thoughtful adjustments, you’ll pad your bank account consistently and may even be able to retire a couple of years earlier than planned. Yes, there’s some research and number-crunching involved, but you’ll be glad you did that eventually.
The numbers don’t lie. Food prices have risen by 3.3 per cent year-on-year in March 2022, and it’s not stopping anytime soon with increases in food production costs, electricity and gas prices. Aside from limiting dining outings, keeping your food bill from ballooning will take some savvy balancing which involves stocking up on pantry staples, meal planning and shopping around for the best deals available.
Look to buy foods with a longer shelf life to cut down on spontaneous trips to the supermarket, and learn the difference between “use by” (when the food is safe to eat) and “best before” (indicating the food’s quality is best before that date but still safe to eat).
Start making more economical decisions when grocery shopping. For instance, plan your fresh fruit and produce intake, stock up on produce (such as cabbage and carrots) that last longer, and buying marked-down meat (instead of more expensive cuts) if you’re going to be using it in the next day or two. When you’re in the store, read the fine print and check the unit pricing — that way, you wouldn’t be paying $5 per kg when you think it’s $5 for the whole fish.
While buying designer threads won’t directly save you money now, if you suss out brands that pick up a solid resale value, you could make a small profit in the future. According to Matthew Eberhart, VP of marketing at resale platform Grailed in an interview with The Wall Street Journal, “fashion works in 20-ish year cycles (hence the naughties style revival), “so if you’re really thinking of it from an investment perspective, [consider] what was cool 15 years ago and try and get ahead of it.”
According to the article, anything Phoebe Philo designed during her tenure at Céline, clothes and accessories by the late Virgil Abloh and Chrome Hearts tend to sell well. Then there’s the rising price tags of designer bags to take note of. Recently, Chanel cited exchange rate fluctuations, changes in production costs and synergising prices globally as reasons for their Medium Flap Bag’s price increase from US$6,800 (S$9,235) in 2021 to US$8,800 (S$11,951) since 2021. If you’d purchased it in 1990, you would have gotten it for US$1,150 (S$1,561).
Smart shoppers know that you pay off your credit card bills in full at the end of every month. Smarter shoppers though, make sure they’re earning some form of cashback/air miles for every dollar spent. For instance, check DBS Live and POSB Everyday for 5 to 8 per cent rebates.
But the most intelligent shoppers make card sign-ups a way to get some cool lifestyle perks which they might otherwise buy, or sell on the side. Do your research and you could bag everything from a free Apple Watch SE (Citi Cash Back+ Mastercard), Nintendo Switch Gen 2 (Citi PremierMiles Card), SMEG DCF02 Drip Filter Coffee Machine or a Samsung Galaxy Buds Live 2 (American Express Singapore Airlines KrisFlyer Credit Card), Apple AirPods 3rd Generation (Standard Chartered Unlimited Cashback Credit Card), and $400 worth of Marina Bay Sands Gift Certificates (DBS Women’s Card).
While there’s an annual fee to keep in mind and some homework to ensure you meet all spending criteria, if you’re diligent about it, not only will you build up your credit history, but you’ll also be able to secure some freebies from the money you already know you’re going to spend.
With mask mandates being eased and class size limitations opening up, nothing beats the social aspect of heading to the gym, plus the in-person instruction which is crucial for beginners. Shop around to find a gym that suits your budget and fitness priorities so you’re paying for what you will actually use. If you don’t require a pool, look at boutique gyms that may work better for your monthly fitness budget.
If you’ve already got your fitness basics down pat (for instance, how to engage your core properly and do foundational exercises in proper form), you may benefit from an at-home gym space that doesn’t need to cost too much to set up. For a start, you’ll need a proper exercise mat and some light weights. Many gyms now have on-demand virtual classes such as Barry’s At-Home, which allow you to glean the benefits of a class setting from the comfort of your home.
Otherwise, utilise fitness apps like Peloton, Alo Moves, Obe Fitness and The Pilates Class, which all offer free trials. If you plan your sign-ups properly (or even share them with your bestie), you might enjoy a few cost-free months of fitness app membership.
The truth is, skincare can get expensive, and one way to save your dollars in the long run is to get smart about what you spend, or invest on.
Beauty pros don’t admit it, but there’s a secret rule amongst them: If a product isn’t spending a lot of time on your face, e.g a cleanser or makeup remover, a wallet-friendly drugstore brand will suffice. Another secret: These pros keep a lookout for when cult items are on sale, so they can stock up on them, and they schedule in regular medifacials that deliver longer-lasting effects.
Splurging on the skincare that works for your skin is a savvy investment that pays off in the long term. A night serum that gives your skin a beautiful hydrated glow when you wake up, or a lightweight sunscreen with added blue light protection, that doesn’t leave a white cast on skin, and doesn’t pill under makeup.
At the same time, make a consistent effort to adopt healthy skincare habits such as daily deep cleansing, regular facials, drinking more water, and having a balanced diet. With healthy skin that glows from within, you will be inspired to do with less makeup, which will save you money in the long run.
If you own a home, or are looking to buy one, you know that interest rate hikes are on the horizon. According to the Business Times, “mortgage rates in Singapore could be raised 3 times this year, by 25 basis points each time.” Financial advisors will always recommend getting your home loan refinanced or repriced. As a rule of thumb, if you can save anywhere from $1,000 on interest payments, refinancing is a good idea.
If it’s been a while since you’ve looked into the nitty-gritty, crunch the numbers to see if converting from a fixed interest rate to a floating interest rate, or vice versa, will help lower your monthly payments. Do keep in mind your loan’s lock-in period; if you’re nearing the end, there’s usually a three-month notice period — this is the time to shop around. If you’re still deep into your lock-in period, you may still be able to re-finance for substantial savings but there’ll be a penalty fee to pay, so make sure it works in your favour.
Saving money and buying big-ticket items may not be an immediate association but if you’re buying $6.50 gluten-free muffins every other day, maybe fork out $599 for a Kitchen Aid Stand Mixer and make your own. Not only are you actually saving money (ingredients notwithstanding) but you might even get a side gig out of it. Add on supply chain issues and inflation, buying something you know you’ll need in the future now versus six months down the line might actually save you a decent amount of money.
Take stock of your current home scenario and strategise how you can enjoy your favourite outdoor luxuries at home. Choose items that add value to your present lifestyle: a coffee machine for weekend cappuccinos, a wine fridge so you can host wine tastings, a proper Hi-Fi system so you can bring that in-cinema experience to your couch. While you research, look into their resale value (do a quick search on Carousell or FB Marketplace) so if the purchase doesn’t work out, you’re not stuck with an expensive white elephant.
Did you know that electricity charges and telecommunication charges not reimbursed by your employer are considered expenses incurred for work purposes, and can be claimed as deduction against your employment income for the year?
Taking a proactive approach to lowering your tax bill is a life skill everyone should learn – and it doesn’t take a genius to figure it out. While most people know about income reliefs for parents, children, charitable donations (for every dollar, you get a $2.50 tax deduction), one easy but often overlooked way is to contribute cash towards your SRS account.
While capped at a maximum of $15,300 per annum, every dollar deposited into the account reduces your taxable income by a dollar – and you get to re-use that money for investment purposes, thus growing your retirement account. Another CPF-linked approach is to top up your Special Account (capped at $7,000 per annum), which can bring you to a lower chargeable income bracket so your tax bill is calculated at a lower interest rate.
Also, if you’re already keeping track of employment expenses, these can be deducted so make sure you keep receipts to back up business entertainment expenses, travel and even electricity and Wi-Fi expenses if you’re working from home.
Now that there’s a subs for everything from wellness newsletters to your beauty serum, Netflix, Disney+, and Google Drive (because you take too many videos), it’s hard to keep track of where your money is going each month. While letting yourself get billed as little as $2.99 per month doesn’t seem like much, multiply that by four digital subscriptions that you use once or twice a month, and you’d have flushed a nice dinner down the drain.
Keeping on top of them – we recommend simply listing them out on a Google Sheet with start/cancellation dates – is one way to examine which subscriptions you’re *actually* using, and also how you can cycle through them to see which you need for a specific period (Netflix for when your favourite bingeworthy series is back, Spotify if you’re focused on podcasts for the month) instead of all year round. Also, don’t rule out signing up for 30-day trials or looking for reduced rates (ask about student or family rates or check if your telco has a special bundle deal) if you like the service.
With international travel resuming, it’s time to go shopping for travel insurance plans again.
Look through policy features for coverage details connected to travel disruptions, loss/damaged baggage, and overseas quarantine allowance should you inadvertently get stuck and incur additional out-of-pocket costs.
Similarly, a personal accident insurance plan warrants looking into, as the right policy can save you from large, unexpected bills. If you’re embarking on more physical activities such as hiking, cycling, scooting and workouts, a personal accident plan ensures you’re properly covered, and won’t chalk up a huge amount of medical bills in the *touch wood* scenario you incur an injury and/or require TCM and physiotherapy services that are not included in most hospitalisation plans.
New personal accident insurance plans also cover for Covid-19 (and other diseases like dengue and hand, foot and mouth), and have a hospital cash component ($50 to $100 a day) should you be unable to work for a while.
With rising fuel costs and car prices at a premium, can you justify owning a vehicle now? It comes with a considerable chunk of monthly expenses, on average $1,000 a month.
Crunch the numbers to see what you’re spending annually on the car besides the loan (road tax, maintenance, insurance, parking, petrol) and if the gap can be closed by utilising ride-share services or car rental services like DriveHub and BlueSG (although, take note that pets aren’t allowed).
There’s also the option of owning an electric car where government incentives in recent years can add up to $45,000 of savings for EV buyers. Aside from an entry Tesla Model 3, there are also more affordable EVs like the Nissan Leaf, Hyundai Kona Electric and MG ZS Electric to consider.
If a car is a must-have, look into buying from automotive providers like CarVault who can bundle annual maintenance cost into a sale or help trade in your existing vehicle to make it a more affordable purchase. Spend time shopping around for a better-suited car insurance policy as well to ensure it includes extras, such as repairs, young/new driver excess, damaged windscreens, that you may have failed to consider.