Remember when you were a kid and you
thought turning 21 was the only thing you needed to do to become an
adult? Ah, those were good times. “Adulting” is much, much more
than just what kind of movie classifications we can watch and goes
beyond the ability to drive and buy alcohol. And yes, while it may be
still too early to start thinking about buying a house or raising
children, some of us may be fearful of the responsibilities of being
an adult in Singapore. Here's a little food for thought with regards to that:
Here’s the thing – you may not
have realised it, but if you’ve started earning money for any kind
of work, you’re pretty much starting to adult. Here are 5 ways to
tell that you’re already “adulting":
1. You are giving your parents an
Now that you’re earning your own
paycheck, it’s payback time. Remember how your parents used to give
you a regular allowance while you were in school? I’m betting those
days are over the second you get your salary. Now the tables have
turned and you may be expected to provide them with a regular
Even if your parents are still working,
you should still give them an allowance. This will help you take
ownership of the household expenses. Your contribution may help to
defray the utilities bill or pay for that month’s groceries, for
example. Ultimately, it’s the principle of responsibility that
matters – so if your parents don’t really need your money, why
not set up a Regular Savings Plan for them instead? It’s a simple
investment tool which they can cash out and utilise during their
retirement years. Don’t know what to invest in? As an alternative,
you can help boost your parents’ retirement income by topping up
their Special Accounts (if they are below the age of 55) or
Retirement Accounts (if they are aged 55 and above) through the CPF
Retirement Sum Topping-Up Scheme (RSTU) – you even get tax relief
by doing that. Click here to find out how much
you can top up and the tax relief you can enjoy under RSTU.
2. You now pay attention to how
much mobile data you use
Now that you’re earning a salary, you
will most probably be expected to start paying for your own stuff.
Especially your mobile phone bill!
Gone are the days when you didn’t
need to care about Wi-Fi because you had no idea how much 4G data you
were using. Now that you’ll be settling your own monthly telco
bill, you’ll pay special attention to just how much data you have
and how much you can use. No more video streaming while on the way to
work, since you run the risk of paying for excess data charges!
Paying $10.70 per Gb of excess data usage is no joke.
And unless you make the effort to
budget your expenditure, you can probably forget about getting the
latest phone model as soon as it comes out. But the good news is,
once you start working, you should check if you’re eligible for
corporate mobile plans or some other telco deal that your employer
3. Your holidays are no longer
Welcome to the working world, and
welcome to finding your own ways to fulfil your travel needs. Which
means you’ll have to start saving for these trips. Alternatively,
you can find ways to be smart about travelling.
For example, your friends or your
colleagues might want to do a quick weekend trip up north to Malaysia
or Thailand. Go with them! Travelling in a group often saves money,
especially when it comes to accommodations or renting a car. Unless
your travel buddies are only planning to eat at restaurants with at
least two Michelin Stars.
But whether you’re travelling in a
group or by yourself, consider signing up for a credit card that
earns you air miles every time you spend. These miles often go a long
way in helping to subsidise your flights.
4. You’re now eligible for your
own credit card
I know some of you may have carried a
supplementary credit card, or even one of those student credit cards
with a $500 credit limit. Forget those. A fresh grad in Singapore
could be earning about $2,500 a month, or $30,000 a year. That’s
all you need to be eligible for your own credit card, complete with a
credit limit that’s just high enough to encourage all kinds of bad
Being an adult means being aware of
just how much credit card debt can get you in trouble – not only
can the fees and charges on unpaid bills go into the thousands, but a
poor credit rating will make it harder for you to secure a loan when
you want to buy your own house or car later.
But being an adult also means being
aware of how credit cards can benefit you as well. If you spend
within your means and pay all your bills in full and on time, you
could be swimming in cashback rebates, rewards points and air miles
instead! Just make sure you get the right credit card for your
If you tend to overlook payments,
consider setting up automated payments using GIRO or a standing
instruction via Internet Banking.
5. Your take home pay is less than
As long as you’re a Singapore Citizen
or PR below 55 years old, 20% of your monthly salary will go into
your CPF account. That means if your official salary is $2,500,
you’re only taking home about $2,000. That’s going to seem like
quite a big deal when you’re just starting out and didn’t budget
with CPF in mind.
But here’s the thing – you’re not
the only party contributing to your CPF account, your employer is
contributing as well. In addition to paying your salary, your
employer also contributes an extra 17% of your salary into your CPF
account. This total of 37% goes into a mix of your Ordinary Account
(OA), Special Account (SA) and Medisave Account (MA), whose interest
rates are higher than that of a lot of banks’ savings accounts.
Here’s how this 37% of your salary is
Rates from 1 Jan 2016
monthly wages ≥ $750)
35 to 45
45 to 50
50 to 55
And your CPF funds aren’t just for
show! There are several ways you can use your CPF, so let’s look at
a couple of them.
A. Using your Ordinary Account to
pay for housing
Whether you’re planning to buy a HDB
flat or a private property, your CPF Ordinary Account can help you
significantly with the purchase. Thanks to CPF, you sometimes don’t
even have to pay a single cent out of pocket.
B. Using your Medisave Account to
pay for healthcare
Your Medisave can be used to help you
pay for selected medical care and hospitalisation expenses. This
reduces the amount of money you need to pay out-of-pocket, so that
your medical bills don’t affect your cashflow. For example, you can
withdraw up to $300 a day for approved day surgeries and $450 a day
for inpatient hospitalisation.
Medisave can also
be used to pay for your MediShield Life or integrated shield plan
insurance premiums, so that you don’t have to feel like your
healthcare coverage is limited by your take-home pay.
So yes, you’re already “adulting”!
Hopefully you’re already doing some,
if not all, of the 5 things mentioned above. Being an adult in
Singapore is not as hard as it might seem and all you need is to
start with these small steps.