I was prompted to write this article after being "poke" a few times by a persistent fan of mine. Oh I feel so honoured. Anyways thks Prissy :) I felt this is the topic to talk about today because this topic of $$$ & overuse of $$$ (leading to bankruptcy) has popped up to me a few times this past week.
Reference from The Straits Times 24 June 2008 (Teo Cheng Wee)
Click on link to see article
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They are below 30, employed and mired in debt. This is the fastest-growing age group of debtors, say credit counsellors. On average, they owe $55,000 to about seven creditors, according to new data from Credit Counselling Singapore (CCS), a non-profit group which advises debtors.
Under-30s made up 9 per cent of all cases handled by it in 2006, and 13 per cent last year. In the first three months of this year, it went up to 15 per cent. CCS told The Sunday Times that most of these young adults are snared by materialism and a desire for the high life.
They splash money on cars, branded goods, overseas holidays, clubbing and gadgets. Several also gamble their money away.
Last year, people aged 30 and below made up 7 per cent of all bankrupts. In the first four months of this year, that has increased to 12 per cent. He puts it down to them succumbing to the temptations of consumerism, while knowing little about financial and credit management.
She borrowed $50,000 from parents to fund her shopping
If money had not been so easily earned for Joyce (not her real name), 27, she feels she would not have chalked up her $200,000 debt over four years of wild spending.
But it all seemed so rosy when the business graduate started promoting credit cards fresh out of university in 2003. The job, which also pays her commission, allowed her to take home $20,000 to $30,000 a month.
'There I was, not even 25 and drawing a salary that not many people earned. I thought making money was so easy,' she says.
She spent her money lavishly. When she went clubbing with friends, she would pay for the drinks. She also chalked up some $8,000 worth of monthly spending on luxury goods. Bags were her weakness. She remembers strutting into Louis Vuitton or Gucci outlets every month to buy a new bag costing a few thousand dollars.
Spurred on by colleagues with similar spending habits, Joyce felt that image was of utmost importance. 'People who shop at boutiques will know how much those bags cost. I wanted people to know how much I earned,' she recalls.
Her problems started when she switched jobs in 2005, jumping ship to another bank to sell investment products. She thought she could continue her stellar sales record, but she found the going much tougher. Joyce never did well enough to earn commission, even till today. Her monthly salary dipped drastically to $2,500.
But she continued her wild spending habits, applying for more credit cards when she maxed out her current ones. Her lack of income stressed her out - and ironically resulted in her shopping more to relieve the stress.
She also borrowed $50,000 from her parents on the pretext of investment but used it to fund her shopping instead. More expenses piled up when she got married and bought a flat that same year. Her financial troubles peaked early last year when she realised she could not even pay her credit cards' minimum payments.
She had to sell her 60 luxury bags online - many at huge discounts.
But the interest on the outstanding sums was so high by then that she would 'pay and pay, but the money owed never came down'.
'But I told myself: 'Can't pay, can't pay lor. At the most, I have to declare myself bankrupt',' she recalls.
It was only when a close friend explained to her the consequences of bankruptcy - that it would not discharge her from her financial liabilities - that reality finally hit home.
At that point, Joyce also realised how much her work suffered because she was fretting over her bills and trying to hide her financial troubles from colleagues.
Her relationship with her husband soured as they quarrelled frequently about work. Her family shunned her too. She realised that she was often the last to know about any news at home. Till this day, only Joyce's family and a few close friends know of her troubled past.
With the help of Credit Counselling Singapore, she is slowly but surely paying back her debts - about half of her $3,000 salary goes to this. The new Joyce is a much happier person who still has credit cards but has little wish to use them. Asked if she has any advice for other young people, however, and she is skeptical.
She says a friend - who does not know about her financial past - appears to be falling into similar problems but ignored her advice to watch her spending.
'I feel that if someone has a 'heck-care' attitude towards spending, no amount of advice will stop them,' she says. 'My mother used to tell me: 'With young people, you can tell them there is a wall ahead and not to walk into it. But they won't listen until they actually hit the wall.' 'By then, it's too late. You will already have a bruise.'
Do you know that
Upon declaring bankruptcy:
1) Your property can be seized by your creditors to offest your debt
2) You need to declare your pay & pay back your creditors leaving only a sufficient amount to support himself and your family
3) Your bankruptcy will be advertised, so future employers or third parties could find out from reading the newspapers. In some jobs your might be required to inform your employer.
4) You must seek permission to reveal who is paying for your holiday expenses else you cannot take a holiday overseas
5) Your bankruptcy records will be kept for six years and given to banks. You could find it hard to get a credit card or housing and car loans.
Reference from The Straits Times 29 June 2008 (Lorna Tan)
Reference from The Straits Times 24 June 2008 (Teo Cheng Wee)
Click on link to see article
*******************************************************
They are below 30, employed and mired in debt. This is the fastest-growing age group of debtors, say credit counsellors. On average, they owe $55,000 to about seven creditors, according to new data from Credit Counselling Singapore (CCS), a non-profit group which advises debtors.
Under-30s made up 9 per cent of all cases handled by it in 2006, and 13 per cent last year. In the first three months of this year, it went up to 15 per cent. CCS told The Sunday Times that most of these young adults are snared by materialism and a desire for the high life.
They splash money on cars, branded goods, overseas holidays, clubbing and gadgets. Several also gamble their money away.
Last year, people aged 30 and below made up 7 per cent of all bankrupts. In the first four months of this year, that has increased to 12 per cent. He puts it down to them succumbing to the temptations of consumerism, while knowing little about financial and credit management.
She borrowed $50,000 from parents to fund her shopping
If money had not been so easily earned for Joyce (not her real name), 27, she feels she would not have chalked up her $200,000 debt over four years of wild spending.
But it all seemed so rosy when the business graduate started promoting credit cards fresh out of university in 2003. The job, which also pays her commission, allowed her to take home $20,000 to $30,000 a month.
'There I was, not even 25 and drawing a salary that not many people earned. I thought making money was so easy,' she says.
She spent her money lavishly. When she went clubbing with friends, she would pay for the drinks. She also chalked up some $8,000 worth of monthly spending on luxury goods. Bags were her weakness. She remembers strutting into Louis Vuitton or Gucci outlets every month to buy a new bag costing a few thousand dollars.
Spurred on by colleagues with similar spending habits, Joyce felt that image was of utmost importance. 'People who shop at boutiques will know how much those bags cost. I wanted people to know how much I earned,' she recalls.
Her problems started when she switched jobs in 2005, jumping ship to another bank to sell investment products. She thought she could continue her stellar sales record, but she found the going much tougher. Joyce never did well enough to earn commission, even till today. Her monthly salary dipped drastically to $2,500.
But she continued her wild spending habits, applying for more credit cards when she maxed out her current ones. Her lack of income stressed her out - and ironically resulted in her shopping more to relieve the stress.
She also borrowed $50,000 from her parents on the pretext of investment but used it to fund her shopping instead. More expenses piled up when she got married and bought a flat that same year. Her financial troubles peaked early last year when she realised she could not even pay her credit cards' minimum payments.
She had to sell her 60 luxury bags online - many at huge discounts.
But the interest on the outstanding sums was so high by then that she would 'pay and pay, but the money owed never came down'.
'But I told myself: 'Can't pay, can't pay lor. At the most, I have to declare myself bankrupt',' she recalls.
It was only when a close friend explained to her the consequences of bankruptcy - that it would not discharge her from her financial liabilities - that reality finally hit home.
At that point, Joyce also realised how much her work suffered because she was fretting over her bills and trying to hide her financial troubles from colleagues.
Her relationship with her husband soured as they quarrelled frequently about work. Her family shunned her too. She realised that she was often the last to know about any news at home. Till this day, only Joyce's family and a few close friends know of her troubled past.
With the help of Credit Counselling Singapore, she is slowly but surely paying back her debts - about half of her $3,000 salary goes to this. The new Joyce is a much happier person who still has credit cards but has little wish to use them. Asked if she has any advice for other young people, however, and she is skeptical.
She says a friend - who does not know about her financial past - appears to be falling into similar problems but ignored her advice to watch her spending.
'I feel that if someone has a 'heck-care' attitude towards spending, no amount of advice will stop them,' she says. 'My mother used to tell me: 'With young people, you can tell them there is a wall ahead and not to walk into it. But they won't listen until they actually hit the wall.' 'By then, it's too late. You will already have a bruise.'
Do you know that
Upon declaring bankruptcy:
1) Your property can be seized by your creditors to offest your debt
2) You need to declare your pay & pay back your creditors leaving only a sufficient amount to support himself and your family
3) Your bankruptcy will be advertised, so future employers or third parties could find out from reading the newspapers. In some jobs your might be required to inform your employer.
4) You must seek permission to reveal who is paying for your holiday expenses else you cannot take a holiday overseas
5) Your bankruptcy records will be kept for six years and given to banks. You could find it hard to get a credit card or housing and car loans.
Reference from The Straits Times 29 June 2008 (Lorna Tan)
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