Should I forgo investing completely and dedicate to clearing my mum's debt?

I don't want to see Kok Koon after class bcos I need to gym so I reply here too.

We need to know the source of the problem.

If ur mum debt is due to gambling and bad habit, is likely the same problem will come back again.

My solution will solve the coming back problem if the loans are from legal source n wun get illegal harrsement.

Let ur mum declare bankrupt after withdrawing all the cash from bank or join accounts.

Close all other investment with her name and sell all valuable assets if needed. Except roof over the head.

Cpf and HDB will be protected from bankruptcy so ur mum still have a place to stay.

If u think my solution is harsh, then u just have to bite the Bullet n hate her for life.

I generally agree with Gabriel. That said, what would happen if your mom's debt isn't cleared?

Is there a house to seize? Lost business opportunities due to being a declared bankrupt etc? If not, it might make more sense for her to just declare bankrupt. You can continue supporting her of course, but you can save on the giant debt

Even if it is 4.5% it will still compound at an astounding rate. $60k means $2700+ in interests cost alone. Since u can't pay the sum in full, there will likely be additional financing fee/charges added on? Such low rates are likely not fixed and will be floating, that means it will rise in the future. You should always pay down such debts first. There will be investment risk, and not to mention to be sure of getting investment return above 5%. You might as well pay down the debt thus guaranteeing an effective return of 4.5%+. In addition to the peace of mind.

Before looking into bankruptcy which many suggested, You should ask your mum (get a trusted friend/relative to help) to negotiate with the bank for a settlement plan. This is to stop the interest cost from snowballing (which is also what bankruptcy does - legally ceasing interest cost). Since u mentioned your mum is jobless, it seems unlikely the debt will be repayed in a meaningful way. Negotiate for a discount and a repayment plan.

If the bank or you doesnt accept the terms, bankruptcy is the next likely option. I can only touch on what to expect in bankruptcy in brief here.

Benefits of bankruptcy: Legally stops interests cost, stops all your creditors from further suing you (for debt incurred before point of bankruptcy), forced settlement program for u and your creditors.

Cons: Lifestyle restrictions. For example Have to take public transport bus/mrt (no car or taxi). Cannot eat in restaurant. Cannot buy premium mobile phone.

Cannot travel overseas without official approval. Will most likely unable to work in government and finance related job. Along with social stigma...etc

The debtor's home will be protected (If it is a HDB, and owned by singapore citizen). Furniture and most personal effects are also protected. Monies in CPF are protected too, but if the monies are withdrawn voluntarily (say after age 55), they need go towards repayment of debt.

There are cost in the bankruptcy process so bear in mind. Application/filing of documents with the court etc. Even the administration of your bankruptcy will have a % cost based on the amount involved. So it can be a costly process.

Gist of what to expect after filing application. If the total debt is under $100k, your case will be reviewed to undergo "debt repayment scheme", where a repayment program can be worked out with your creditors, thus avoiding bankruptcy status. If it fails, you will be officially declared bankrupted.

After u are declared bankrupted, u will need to file a statement of affairs with the official assignee. This will include all your assets and liabilities, creditors etc. The official assignee will work with your creditors and you to come up with a settlement program. All your assets will need to be transfered to the official assignee to be sold/make repayment to your creditors. If the debtor is unemployed, the debtor will be likely to be referred for employment and skills upgrading program.

If the scheduled repayment plan can be fulfilled by the end of 3-5years (typically), a discharge of bankruptcy can be applied.

My bro got into deep financial debts from gambling more than 10 years ago. Accumulated more than $100k +... that period also happens to be the 2008 financial crisis... my decision taken then, which I will never regret, is that I sold/liquidated my investments at huge losses in order to help him clear the debts... I was less than 30yo then... I restarted all over again after this crisis... my point is, i was still young then (i’m still only 40 now!) life is never plain sailing, this are obstacles that is bound to happen throughout our lifetime... we are family for a reason... money can always be made & earn again... we are still young... for the sake of our own investment gain/wealth, & leave our family “to die“, can we leave happily ever after still???