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Planning a strategy to get out of debt

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CPF

Loans

Education

Lifestyle

Pay off the lump sum, IF you can afford it. No point paying extra interest. The faster you pay off, the money gets back into your parents CPF account which in turn will grow at the prevailing CPF rates.

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Savings

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Education

Junus Eu
Junus Eu
Top Contributor

Top Contributor (Sep)

Level 8. Wizard
Answered 6d ago
Given that you sound pretty young - I would say to get a few more years of work experience first. It could be the case that you might not want to pursue computer science post your work experience, or want it even more. Re: the argument of 'possibly getting a higher pay' - I do believe that relevant work experience counts more than another degree. From a cash flow perspective, it also makes sense to pay off your uni loans first, instead of being loaded with another loan, making your total loans $30k + at 4.5% p.a.

Insurance

Loans

Family

I think it is better to talk directly to GE agents or servicing line to get the direct bonus and surrender value. If not cash tight, maybe paying back the loan, and leaving the policy to accumulate faster is a good idea. This happened in one of my dad's policies many years ago too, we paid the policy loan as the returns from the policy is at the mature end and the policy is accumulating better returns for my dad. If cash tight, of course, surrender the policy is an option. You can also sell the policies to an old-policy dealer such as... I can't tag him here. Loh Tat Tian is one of the second-hand dealers I think.

Savings

Credit Card

Loans

Seedly

Huang Yixuan
Huang Yixuan, Product Designer at Somewhere
Level 6. Master
Answered 6d ago
Hi! If you open up a "Loan Account" in the second tab of your app, you can set the balance to negative, and subsequently, add "income transactions" to that account to keep track of your loan repayment!

Loans

Resale HDB

Usually, foreign banks give a higher loan limit than local banks (only in general, not for all cases) so people may face stricter or lower loan from local banks such as DBS. Also, banks give out promotions periodically, so it could be that CIMB and Maybank had much lower rates a few weeks/months ago and now the promotion rate has ended and DBS just launched theirs. =) Go for the best rate of the period you are loaning, it's the better info compared to reviews of the past.

Salary

Investments

Savings

Loans

Grace Lim Yan Zhen
Grace Lim Yan Zhen
Level 2. Rookie
Answered 1w ago
You are definitely on the right track. Since your loan is 0 interest rate, you can take the time to clear your loans. The 3 month of emergency fund is also the right choice. Do not need to put any emergency fund. 3 months is sufficient. What you can do is invest more. You can put more in saving plan, Varga investment and S&P index. For S&P Index, you can go search on Money course leveraging S&P index Group by Warren Buffett 2013. Hope that this will help you :)

Debt

Loans

Gabriel Tham
Gabriel Tham, Tag Team Member at Kenichi Tag Team
Level 8. Wizard
Answered on 10 Aug 2019
Usually the debt consolidation scheme are for very serious cases of debts. But you can give it a try at the various banks and see if the interest rates are lower.

General

Loans

David Morgan
David Morgan
Level 3. Wonderkid
Updated on 13 Jun 2019
That’s tough but you have to keep going. What are you currently working as? Do you have any high income skills? Do you have any passion that you could turn into profit? If you are lazy to even explore then I would suggest to just find part time jobs during the weekend? If you have to spend family time at home or have to be home during weekends, maybe you could find home based jobs like freelance Social media marketing or free lance digital work such as video editing for clients and such. I had debt too and i had 5 debts to repay to. My monthly salary then was around $2k and my debts amount to around $10k. What I did was to sacrifice some of my own entertainment and leisure spendings. I unsubscribe to my Netflix, I took public transport instead of renting a car, I cooked my own lunchbox in the morning to eat and I remember I had an extra $100-200 to spare each month and I pumped that extra amount to the highest debt first. So let’s say the most highest debt I’m paying is around $500/month. So with that extra $100-200, I’m now paying back $600-700 to that debt. Takes patience and consistency. And once I’m done with that highest debt, i will go on to the second highest debt. Let’s say I’m paying around $350/month for the second highest debt, I now do have extra $600-700 since I cleared the first debt and pumped it in. And now I’m paying my second debt with $1000/month and clearing it even faster and so on and so fourth till I’m debt free. But once I’m debt free, I learnt to spent wisely. Hope this helps, let me know your thoughts about it. :)

Retirement

Property

CPF

Loans

Takingstock @
Takingstock @
Level 5. Genius
Updated 1w ago
I have to agree with Hariz on his answer. Add on points (given I am paying down a 25 yr loan myself): 1) A 30-year loan is horrendous in terms of interest. Ask for the statement that shows you the total interest paid over 30 years assuming rates don't change. I am gonna put my guess that its gonna be about 30++% of the condo purchase price. When I started before ABSD was implemented, the interest was below 1% after it shot to 3%, I found myself having some difficulty. And it might stay that way through the 30 years. As a further add on, if you bring it down to 25 yrs or less, how do you look on your debt servicing ratio? If the property loan ongoing payment at the current rate of 2.2+% is above 35% of your combined income, the condo is probably too expensive for you. 2) If you don't have an annual budget, make one. If you do, then after forking out the cash portion of the loan, are you able to save 10% of the take-home pay? Do you also have some emergency funds left after the downpayment? 3) Have you asked what is the total stamp duty and other fees required for the property? Do you have money for that? 4) What's the annual condo maintenance fee? If you also still have the agent's contact, ask what is the annual property tax estimate. 5) How many bedrooms are there? If its 1+ to 2, the demand and appreciation potential might not be there. If it's 3 or more, that's probably decent for resale demand. 6) is it 99-year leasehold? After 30 years, you would have 69 years left. Have you heard of Bala's leasehold depreciation table? After 30 years, the resale value might be 80% compared to an equivalent freehold property. All of these are property-related questions, not including the other financial aspects. Hope you have time to go through and answer them before signing the papers.
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