Singapore Budget - What is in store for us

Singapore Budget was announced on the 22nd Jan this year. What are the things the average Singaporean can look forward to?

Firstly, there is the doubling of the GST credits. This means that there will be more money in your pocket this year from the government. If you have debts out there, especially credit card or credit line, it might be wise to use it to pay down the debt. If you do not, congratulations, you might take out a bit to pamper yourself and invest the rest, save it for a rainy day.

Secondly, there is the twenty percent rebates on the tax payable subject to a cap of $2000. This will help to put in more money into the pockets of the middle class which forms the majority of the population. (Ain't it true for most countries? Hmmm....) Again, you might want to invest the extra money to build a bigger nest egg for yourself, using compounding interest to your advantage.

Thirdly, employers will try their best to keep Singaporeans in their jobs because of Job Credits, where the employers will get credits from the government. The size of it will depends on the number of Singaporean, paying CPF, in their payrolls. So it makes it 'harder' for Singaporeans to be out of job. But please do not be complacent, try to get yourselves reskilled if possible.

Fourthly, which is recently announced is that transport fares maybe coming down this year without any prospects of fare increase this year (now this is something NEW!! =) ) because of the many rebates and cut in corporate tax from 18% to 17%. The exact fare decrease will be announced at the end of February.

Given all these goodies from the government, it might be time to think through your personal budget and investment plans as more information and of course money flows in.

For more information on planning your budget and making investments, do check out the two webpages here.

Planning your budget and Investments

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Although Singapore is very safe, it does not mean that there are no conmans here. So it is wise to do your due diligence when looking for a place to rent. Before making any payments, it is wise to make sure that you have checked that you are liasing with the right person and all claims are verified.

Ask around those that have rented a flat here, find out the normal practices and also the rental rates of the surrounding areas. All these must be done if you want to prevent yourself from being a victim of a scam.

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Having and Opportunity Fund is overlooked by many investors, including savvy investors who have been in the investing world for many years.

So what is an Opportunity Fund? Basically, it is a sum of liquid assets, usually cash or saving deposits. At this time where there is a "fire sale" on the stock market where stocks, especially blue chips are at their lowest (usually 52 weeks lowest), an available pool of cash to take advantage of the low price would position investors to benefit when the economy recovers and looking back at history, we know that the economy will always recover. It's recovery is only a matter of time.

For most investors, this fund should not be similar to the emergency fund that you read about in most financial planning books or newspaper articles. This emergency fund as read should be equivalent to 6-12 mths of monthly expenses,(depending on how risk-averse you are). Once this fund has been set aside, you should then start setting aside another sum for your Opportunity Fund.

Economic or financial crises are part and parcel of life so we might as well prepare ourselves to take advantage of it. For those that are just starting out, it would be better to learn more about the available investment tools.

For more information on financial planning and investment tools, please click here.

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