What Every Singaporean Should Know About Personal Finance Management

Personal finance may seem like a daunting subject if you are a young adult who has just started earning your first income. There are many foreign aspects of personal finance that you have to pick up, such as management of your CPF (Central Provident Fund), income tax payments, investments, etc. However, fret not as we have compiled 4 tips to help kickstart your personal finance management journey!

Optimise income tax payments

One of the inevitable expenditures you have to make is income tax payment. This is spending that you have to make on a regular basis but are unable to get rewarded for (such as through cashback, discounts, miles) as they do not accept credit payments. However, there is now a solution to this problem! CardUp is a service that can first make designated bank transfers on your behalf then charge it back to your credit card (with a 2.6% transaction fee). By using CardUp for your tax payments, you will be able to earn rewards from your mandatory spending, giving you more value for your expenditures.

CPF contributions

The CPF is a savings scheme implemented by Singapore’s social structure and contributed to by employers and employees. But do you know that CPF can also be a form of investment for you? CPF lets you earn risk-free interest rates of up to 5% per year on the money you topped-up into your CPF Special Account (SA). Moreover, you can receive tax reliefs of up to $7000 on cash top-ups in the SA. You can also receive such tax reliefs when you top up your parents’ accounts. If you are already giving your parents cash, you can easily channel some of the cash into their CPF accounts instead and help them earn a risk-free CPF interest rate as well. There are also other ‘hacks’ you can use to maximise the interest returns on your CPF contributions such as topping up in January instead of December to earn more interests!

Join personal finance forums – such as CrowdFundTalks (CFT)!

We understand that it may be difficult to navigate adulthood on your own. Hence, you can consider joining forums such as CrowdFund Talks where people discuss investments and other personal finance matters within the Asian context. CFT has a vibrant community that are often enthusiasts of alternative investments and crowdfunding, and you can easily crowdsource for answers to your burning questions on investments here! If you would like to share your nuggets of wisdom, you can also share your experience and perspectives to the community and gather their take on the issues!

We hope that these 4 tips will help you embark confidently on your personal finance journey! Of course, with the development of new technologies in the future, there may be changes in personal finance management methods or tools. Hence, personal finance management is a lifelong process!

Make alternative investments

Alternative investments are any investments that do not fall under the traditional umbrella of stocks, bonds, mutual funds or insurance. They include investments such as private equity, real estate, art and collectables, cryptocurrency and Peer-to-Peer (P2P) loans.

For new investors, P2P loans are the easiest way to start. It is a form of debt crowdfunding whereby businesses approach a crowdfunding platform for loans which are then funded by a pool of investors. What this means is that individual investors can finance a small amount to a business of their choice to earn interest returns. One of the largest P2P platforms in Southeast Asia that’s licensed by the Monetary Authority of Singapore (MAS) is Funding Societies, which allow you to invest from as little as $20! It is also an easy way for you to kickstart your investment journey!


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