From The Straits Times    |

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She’s 35, single and has worked for over a decade. She earns $5,000 a month and has no mortgage to worry about. And yet Lisa*, a publishing executive, barely has any savings to her name.

Oh, and she’s $20,000 deep in credit card debt. “It’s been this way for years…I don’t know when or how I’m going to pay that sum off ,” she admits. She allocates about $3,000 each month to her rent, phone and utility bills. A large chunk of the remainder goes into paying off the debt on her three credit cards. But to make matters worse, she’s been regularly rolling over the amount owed for the past 10 years, which means the sum has been snowballing.

How did it get to this? Blame it on her shopaholic tendencies. She has a taste for designer bags and shoes, and enjoys eating at posh spots such as Mezza9, Otto Ristorante and Catalunya, easily racking up bills in the hundreds every time. And when she travels? You can bet she’s staying at five-star resorts in Thailand and Bali.

Sally*, 38, an accounts executive, owes her credit card company $7,000 even though she earns a comfortable $6,000 a month. She splashes out on designer bags, expensive holidays to exotic destinations like the Maldives and Fiji, and fancy toys and clothes for her five-year-old son.

Every month, she tries to dedicate at least $2,500 to servicing her credit card debts – but she always falls short. As long as she can remember, she’s been struggling to pay off purchases she made months ago. Worse, her sales manager husband – whom she calls the “conservative, frugal one” – has no clue. She borrows a few hundred from him whenever she’s desperate, but only as a “last resort”. “The amounts are small, so he never suspects, but if he found out the whole truth, he’d be shocked,” she confesses.


Lisa and Sally aren’t the only ones in credit card hell. Across Singapore, 30-something career women with no kids or mortgages are chalking up dizzying amounts of debt. According to Credit Bureau Singapore, women aged 30 to 34 who have unsecured credit (this includes credit cards) owe an average of $5,445 each. And as of July last year, 62,830 unsecured credit customers had not made a minimum payment in two months – a striking 12.7 per cent jump from the previous year.

How did we get to this stage? Sure, we can blame it on low interest rates and aggressive lending by banks in recent years. But experts say the main reason hits closer to home – we’re just spending way more than we should.

Instant gratification is a hallmark of our generation,says Roy Walker, principal consultant at IPP Financial Advisers (Singapore). Unlike our parents and grandparents, who scrimped and saved, we want it all and we want it now. He adds: “No matter how much financial education or resources they have, folks who need that instant gratification will always have a problem managing their money.”

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Even high-flyers in senior positions are guilty. They splurge and don’t know how to budget, which means that they too are falling prey to the crushing effects of debt.

Take Stephanie*, 33, who is single and still lives with her parents. Though she’s an art director at an ad and marketing agency and earns a decent $4,000 a month, she’s mired in credit card debt totalling $15,000, which she’s amassed since 2007. “I go to the spa every week for massages, mani-pedis and hair treatments; I take cabs everywhere; I eat at expensive restaurants twice a week; and I’m always treating friends to drinks when we go out – I like being generous and I feel bad because my friends don’t earn as much as I do,” she explains. She spends close to $2,000 a month non herself, leaving her with half her salary to pay off her three credit cards – nothing goes into her savings.

“I know I should cut down on my spending, but it’s hard for me to give up my indulgences,” she laments. Stephanie recalls several incidences when she depleted her bank account the day before payday and didn’t have enough to take a bus or train home.n So she’d walk home from her office near Chinatown to her flat in Bukit Merah – a one-and-a-half-hour journey. “I was too proud to ask my parents, siblings or colleagues for money. Walking home one night, I promised myself I’d manage my money better… but I just haven’t been able to nip this crazy debt in the bud,” she says.

She adds: “I admit that I feel powerless when it comes to money. The second it’s in my hands, it disappears. I’m always telling myself that I deserve new things or treats.I hate the situation I’m in, but I don’t know where to start taking control over what I earn.”

Clara*, 34, and her husband Dennis*, 36, both lawyers, have a combined salary of $17,000 a month. So when they tied the knot three years ago, Clara assumed they could easily afford a big wedding in Bali and a nice condo. They went ahead with these, but she now estimates that they’ll spend several years paying for their splurges. “We spent $100,000 on our wedding, a six-figure sum on our condo in a prime district, and even more money renovating and outfitting it with expensive furniture,” she says.

“We had a budget, but I’m embarrassed to say that we busted it. We thought we could afford it all – but we barely did. Now, we’re up to our necks in debt, amounting to about a couple of hundred thousand dollars.”  The couple are also servicing a loan they took out for their wedding and honeymoon. “That will probably take us three years to clear,” she says.

The situation is serious enough for Clara and Dennis to delay starting a family. Having a child now would only mean digging themselves deeper into debt.


Living simply and within your means is the key to staying out of debt, says certified financial planner Daniel Tan. “Some people borrow money just so they can go on holiday, others drive cars that cost way more than they can afford… They can’t distinguish between needs and wants, so they make poor money decisions that keep them in a vicious circle of debt.”

Clara and Dennis have learnt this the hard way and are now slowly building up a small nest egg for their retirement. “We’ve cut back on holidays, extravagant purchases and socialising,” she says. These days, they take the train to work even though they own a car and limit themselves to one nice meal a month instead of splashing out on fancy dinners several times a week. Clara has also had to cut down on the allowance she gives her parents every month.

The couple hope to be out of debt in a few years, and only then will they be thinking about having kids. “It’s sad because I was hoping to be a mum by my 35th birthday,” says Clara. “It doesn’t look like that’s going to happen now.”

*Names have been changed.

ARE YOU IN THE DEBT DANGER ZONE? Watch for these top signs:

LATE BILLS: You fall behind on your payments – mortgage, car, utilities, credit cards, rent, etc – every month because you just don’t have the money.

NO LOAN FOR YOU: You apply for a new loan or credit card, only to be told by the bank that your application has not been approved because you are considered high-risk.

CONSTANT BORROWING: You keep taking loans from friends and family to settle bills.

STRESS: You worry so much about how you’re going to pay your bills that it’s started to affect your work, relationships and health.

COUNTDOWN TO PAYDAY: You frequently find yourself counting down to your next pay cheque. And even before the money’s in your account, you’ve already decided what you’re going to spend it on.

THREE GOOD MONEY HABITS: Adopt these and you’ll never worry about bills:

1. Pay your bills on time. Use Giro so you’re never late. And always pay your bills in full – once you start rolling over, it’s hard to stop.

2. Cancel unused cards. If you have many credit cards but are only using a few, cut up the rest. Keep the ones you are likely to get the best use out of – for example, cards that give you discounts at the shops you frequent.

3. Use cash. Don’t charge to your credit card unnecessarily. If you have cash to pay for something, use it. And if you do roll over your bill, clear your debt before charging any more on your card.


If you are already in debt – worse, if you’re constantly rolling it over – consider working with a non-profit agency such as Credit Counselling Singapore (tel: 1-800-2255-227, to set up a debt repayment plan. If you need advice about your credit health, you can call Credit Bureau Singapore at 6565-6363 or find out more at

This story was first published in Her World Magazine, February 2014 issue.