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3 Steps to Avoid Financial Hangover from Year End Shopping Spree

With all the sales events and holidays that take place from November to December, it’s easy to end up with a big credit card balance by January. For instance, the year end shopping spree has generally increased the consumer credit card debt in Singapore by 5% from September to December in the past 4 years. […]

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Business

Singaporeans with Personal Debt Problem Could Take 10 Years to Pay Off Their Loans (And How They Could Avoid It)

With the rapidly growing mountain of personal debt in the country, the government of Singapore has been introducing many measures to try and control this problem. For example,a bill was proposed in Parliament earlier this month to limit the amount of loan a person can get from moneylenders. Given the latest statistics from Credit Counselling […]

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Business

Why Banks Are Waging a Mortgage War, and What It Means for Singaporean Homeowners

According to a Business Times report, there is a “mortgage war” being waged among banks in Singapore. An increasing number of banks are beginning to offer 3-year fixed rate packages, now with HSBC and UOB joining the flank to match DBS’s leading rates. Others have yet to follow, but it’s too early to rule them out. […]

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Business

Which Loan Should You Get in Singapore With Not-So-Perfect Credit?

If you need money urgently and cannot borrow it from a friend or a family member, a tempting alternative might be to get a cash advance against your credit card. All you need to do is just walk up to an ATM and use your card to withdraw the funds that you need. Although it […]

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Business

Why You Should Never Borrow from Unauthorized Lenders

Unauthorized moneylenders are always looking for people who are in a crunch for cash. It seems they are even on Whatsapp pretending to be licensed moneylenders, ready to give you a loan when you need it to pay your bills. Given that they can charge exorbitant interest rates and abuse the borrowers into repaying their funds, it’s no surprise they are so eager to find their next victims. However, it is when you are the most desperate for money that you should exercise the most caution. Taking a loan from an unauthorized moneylender can be a deal with the devil that can ruin your life in many different ways. Here, we discuss a few pieces of evidence on why unauthorized lenders are still real threats to consumers in Singapore, and what alternatives they can use when they really need cash quickly. Yes, unlicensed moneylenders will still harass you The Singaporean government and its police force have done an amazing job reducing the activities of UMLs in recent years. After hitting its peak in 2009, UML related harassment cases have dropped by 80% to 3,375 per year in 2016, thanks to the law enforcement’s heavy crackdown. However, the recent arrests of loan sharks in Bedok

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Business

3 Home Loan Secrets That You Probably Forgot About – But Shouldn’t

Buying a home is one of the most important and impactful transactions a person makes in his entire life. However, because it only happens once in a lifetime for most people, people usually don’t have a good grasp on the best practices regarding their home mortgages. It’s especially easy to forget the nitty-gritty details of how your home loan works few years after you’ve gotten one. However, just because you don’t deal with home loans on a daily basis, it doesn’t mean you can just forget about them. There are important features of a home loan that can meaningfully affect your day-to-day finances if you remember to utilize them appropriately and regularly. Here, we reveal 3 biggest secrets about home loans that you have to know if you own or are thinking about purchasing a home. Don’t Use Your CPF to Pay for Your Home or Your Home Loan By far the most commonly discussed way of utilizing your CPF money is to use it to make your down payment or monthly mortgage payment for your home. Since you can pay 10% to 20% of your purchase price with the money that’s sitting in your CPF account that can’t be

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Business

Debunking 3 Common Credit Myths: Couples Edition

Whether you’re planning a wedding or already married, it’s critical for you to understand how marriage changes your finances. Will my spouse’s credit debt affect mine or vice versa? Will our credit scores combine? In marriage, you do everything together: you eat together, you raise your children together and you decide on your financial future together. Much of your life is combined but does that include your credit? Here are 3 common myths that could give you a better idea of what you are in for. Myth #1: My credit report information will merge with my spouse’s. Fact: Nothing will happen to your credit after you exchange your “I dos”. Credit reports generated by Credit Bureau Singapore are maintained at the individual consumer level, not at a joint or family level. This means everyone has their own personal credit report and credit score till death do you part. Each individual will have to maintain their own scores throughout marriage. Each spouses’ credit score will continue to be calculated based on the information in his or her own credit report. If your spouse has a bad credit history of missed payments on his or her credit card bills, it will not

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Business

3 Things Borrowers in Singapore Should Know Before Interest Rates Rise

A period of sustained increase in interest rate is coming. The US Federal Reserve is expected to raise its interest rates on Wednesday, 15th of March, and this will have a rippling ramifications for almost every single borrower living in the world, including those in Singapore. Why? It’s because rates in Singapore will also rise in order to keep exchange rates steady. This means that the pattern of borrowing to fund your purchases is no longer going to be as attractive as it has been for the last few years while rates were so low. If you’ve been borrowing to buy a home, a car or even fund your wedding, it’s time to make some changes to your lifestyle. Here, we walk you through what expected to happen with interest rates in the near future, and what you could do to either protect yourself from or to take advantage of this situation. Rising Rates in the US Means Higher Rates in Singapore So how are US interest rates related to rates in Singapore? The Monetary Authority of Singapore, the country’s central bank, is unique in that it regulates interest rates solely to control the value of Singapore Dollar against other

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Business

The Best And Worst Ways To Use a Personal Loan

This article originally appeared on ValuePenguin Personal loans, which are unsecured instalment loans, are becoming increasingly popular because of their relatively low-interest rates compared to other borrowing alternatives like pawn shops or moneylenders. While personal loans can be used for almost any purpose, some use cases are more financially sound than others. Importantly, taking out a personal loan should lead to either an immediate or a long-term economic benefit. Here’s a look at when taking out a personal loan makes sense–and, just as importantly, when it doesn’t. Consolidating or Paying Off Debt Consolidating or paying off high interest debt like credit card bills is not only the most common reason people turn to personal loans but also one one of the smartest. A personal loan allows you to streamline multiple debt obligations into a single monthly payment with a lower interest rate than you would otherwise have to pay. Many credit cards, for instance, have APRs of 25% or higher. In contrast, debt consolidation plans (a specific branch of personal loans) can have rates as low as 5% to 6%. By dramatically reducing your interest burden, a personal loan can have an immediate economic benefit to your daily finances. Home Improvement Using a loan to make

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Business

3 Credit Traps To Avoid

With easier access to credit and the immediate gratification culture of “Buying Now, Pay Later”, many have found themselves caught in a cycle of credit card debt. Our statistics have shown that the highest consumer delinquency rate for unsecured credit cards (including $500 credit limit cards) stands at 6.4 per cent in June this year for people ages 40 to 44. Delinquency, also known as late credit card payment, refers to debt that is owed 30 days or more past the due date. Individuals are beginning to max out their credit limits and use debt to pay off debt. Debt that initially seems manageable for payoff could rapidly snowball because of compounding interest. It is thus important to have a good sense of what we earn versus what we can spend on. Here are 3 credit traps to avoid that could possibly lead you into a downward spiral if credit is not used wisely.         1. The Needs from Wants trap Many Singaporeans tend to incur excess credit card debt through overspending because of their inability to tell needs from wants. Take a general example – food. We are eating out more often than before and as

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Business

4 Easy Tips to Build a Good Credit

Credit is prevalent in our daily life now. From buying of movie tickets with a swift paywave transaction to purchasing of your dream home with a mortgage, credit is used. When speaking of credit facilities, urban dwellers like you and I would find them familiar, holding at least a credit card, car loan or mortgage, just to name a few. Just in the recent year of 2016 alone, over 1.7 million credit applications were made. (CBS Consumer Credit Index) Having a good credit score is an important part of your financial life. A credit score is a number that indicates the probability of an individual going into a default. It is an independent assessment of the individual’s risk as a credit applicant, and how likely he or she is to repay his debts. Banks and lenders love consumers with good credit score. If you have a good credit score, it will be easier for you to obtain credit and help you to achieve the many financial milestones in your life, such as owning your dream house or starting your own business. Here are 4 easy tips that can help you in building a good credit score. Get your credit report

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Business

5 Popular But Terrible Misuses of Personal Loans

This article originally appeared on ValuePenguin The rise of household debt has been a big issue in Singapore. Due to lackluster real income growth compared to the rate of inflation, consumers have been borrowing more to fund their consumptions. While this has been particularly case for expensive purchases like cars, it has also led to rise of personal loans. For instance, Google’s study of financial markets in Asia shows that personal loan was the most searched financial product in Singapore in Q4 of 2016. A quick search around the internet, however, reveals that people might have huge misconceptions about how to properly use personal loans. Therefore, our team at ValuePenguin prepared the below study to demonstrate why you should never use personal loan for certain purposes, and which usage areas are more appropriate for using personal loans. 5 Popular Usage of Personal Loans That Are Actually Counter-productive Some of the popular use cases for personal loans include the following: Home renovation project Education Paying off credit card balance/debt consolidation Temporary funding for an inconsistent or late paycheck Big purchases (i.e. cars, luxury items, vacations) Weddings Medical expenses While this list is not comprehensive, there are several items here that are actually […]

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Business

3 Tips on How to Get Rid of Your Piling Personal Debt and Credit Card Balance

This article originally appeared on ValuePenguin Personal debt is a growing problem for Singapore’s consumers. According to ValuePenguin’s study, unpaid credit card debt and personal loans represent 46% of S$55,000 household debt per capita of an average person in Singapore. Sure, having loans for your home or your car is a reasonable cost of living that you can’t avoid, but if you have S$20,000 to S$30,000 of credit card debt or personal loan, you really need to be looking for ways to become debt-free quickly. These loans can easily cost you 15-25% in interest every year, which can add up to thousands of dollars. But what are the best ways to actually repay these high cost loans quickly? Our team at ValuePenguin has investigated the best financing options to help guide you back to financial health and happiness. If You Have A Small Amount Of Debt that You Can Repay In 12 Months: Balance Transfer Loans If you have a growing balance of unpaid credit card bills, you might want to consider getting a balance transfer loan from bank. Basically, you can transfer your credit card balance to a different bank, and get a “grace period” of 3 to 12 […]

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Business

How to Get the Best Personal Loan for Your Holiday

This article originally appeared on ValuePenguin Most people with a traditional approach to their finances may think that they shouldn’t borrow money to go on a holiday. Being financially conservative usually means that, while taking a loan for buying your own home or a car is acceptable, borrowing to fund an overseas trip would be frowned upon. However, there are a few instances where doing so could be justified. First and foremost, you should already have a decent financial standing: if you have a good amount of income compared to your normal level of expenditures and if you are without much debt, taking out a personal loan to make a holiday of your dream happen shouldn’t be too bad of an idea. Secondly, this is especially the case if you are planning your honeymoon; for a once-in-a-lifetime event, spending a few thousand dollars more can be worth a lifetime of amazing memories, as long as you can safely handle paying back your loan over time. Luckily, a personal loan is a decent way to finance your vacation if you don’t have enough savings because its interest rates are quite low compared to other possible sources of funding like credit card […]

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Business

Rising SIBOR: Should You Refinance Their Home Loans Now?

After floating around 0.4% for +5 years, 3-Months SIBOR has risen to around 1% by May of 2017. This is because the U.S. central bank began to hike its interest rates since 2015. However, although rates in the US have continued to increase ever since, 3-Month SIBOR has actually fallen recently from 1.2% in March 2016. This could be a rather confusing phenomenon for an average consumer, especially if he is trying to decide if he should be refinancing his home loan before rates to up even more. Will SIBOR continue to be decoupled from the US rate, and even go down more from here? Or will it eventually catch up with the US rates and continue its rise? Here, we breakdown a few facts to help you make a better financial decision. US Rates & SIBOR Have Long-Term Correlation Although you can see from the charts above that SIBOR and US rates have not moved in tandem since 2015, there’s an undeniable correlation between the two rates, especially in the long run. This is because the Monetary Authority of Singapore, Singapore’s central bank, regulates its interest rates primarily in order to control Singapore Dollar’s exchange rates. When US Rates […]

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Business

Where’s Apple’s $257 billion stashed? Mostly in the debt of other companies

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If Apple Inc. were a bond fund, it would dwarf the competition.

The iPhone-maker has $148 billion of its record $257 billion cash pile invested in corporate debt alone, according to a company filing from Wednesday. That’s enough to buy all the assets in the world’s largest fixed-income mutual fund, the Vanguard Total Bond Market Index Fund, which has about $145 billion of assets including company, government and mortgage bonds.

Like many technology companies, Apple has resisted transferring the money it earns abroad back to the U.S. to avoid triggering corporate income taxes on the earnings. Instead, the Cupertino, California-based company invests in corporate bonds and other assets like money market funds and U.S. Treasuries. Read more…

More about Bonds, Debt, Bloomberg, Apple, and Business

Business

5 Points to Consider Before Renovating Your Home

If you are buying a new flat, it is essential to set aside an additional S$50,000 to S$80,000 to renovate it according to your tastes. Those who have lived in the same house for a period of 10 years or more would need to spend a substantial sum to refurbish their homes. But, wow will you pay for this expense? If you have recently bought a home, you would have probably taken on a large home loan, and it could be a meaningful burden to incur further debt for your renovation. Therefore, people who are remodelling an existing home should also try and avoid taking a loan for this purpose. Instead, they should plan ahead and set aside money on a regular basis. However, at times, the only way to arrange the required funds is through a renovation loan. Several banks offer this product specifically for people who need help funding their home renovations, and often even give you a discount if you already have a home loan from them. Here are some other points to keep in mind so that you can be sure to get a great renovation without stretching your finances too much. Decide on your budget […]

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Business

Rising Interest Rates in Singapore : Consumers Are Rushing to Borrow

This article originally appeared on ValuePenguinSince the US Fed announced its plans to raise interest rates in December of 2016, interest rates in Singapore have also begun to rise, albeit slowly. For instance, 3-Month Singapore Interbank Offered Rate (SIBOR) has already reached 0.94% in March 2017 after bottoming out around 0.87% in September of 2016. While that may seem small to some people, that’s a relatively meaningful increase of 8%. SIBOR affects almost every interest rate in Singapore, and therefore an increase in SIBOR means greater interest burdens for borrowers. Given that Singapore’s monetary policy is almost solely focused on currency exchange rate stabilisation, further interest hikes expected to come from the US usually means higher rates for Singaporeans too. In anticipation of such at rend, it seems that Singaporean consumers are rushing to finance their big purchases before rates rise further. Below are some of the key trends we observed. Car Loans Are Increasing for the First Time in 8 Years According to our study of household balance sheet in Singapore, car loans have been declining consistently since 2008. After reaching S$17bn in 2008, it nosedived to almost half of its peak to S$9.6bn in 2015. Towards the end […]

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Business

4 Tips on Improving & Building Your Credit Score in Singapore

A high credit score can provide you with an immense range of benefits. Just to list a few examples, banks and other financial institutions will be keen to lend to you when you have a great credit score. This means that you will be eligible for a greater amount of loan, get it more quickly, and pay lower interest rates. On the other hand, if you have a poor credit score, you could find it difficult to even get a credit card or a home loan. It is also likely that the large banks would refuse to finance you flat out, which means you have to borrow from more expensive sources like pawn shops or licensed moneylenders. If you are worried about how to improve your maintain your credit score, you can read our guide below to learn how the credit score system works in Singapore, and what you can do to improve your financial standing in the country. How Credit Scoring System Works in Singapore The Monetary Authority of Singapore has authorised only two credit bureaus to issue credit reports and credit scores. These are: Credit Bureau of Singapore DP Credit Bureau [/list Both these institutions track various aspects […]

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