After being hit with a global pandemic, worldwide recession, and an ongoing international conflict, it is no wonder that Singapore is experiencing a huge rise in inflation.
As of June, our core inflation (this excludes accommodation and private transport) is close to hitting an all time high, coming in at a 4.4% increase as compared to June 2021. The last time we’ve seen such numbers was in November 2008, shortly after the 2008 financial crisis.
While there is little you can do about inflation, we’ve compiled a few tips and tricks that will allow you to save money and accumulate wealth even in this turbulent economic time.
3 Ways to Save Money in 2024
There are many ways for the savvy Singaporean to increase their savings. These range from intense budgeting and investing to becoming more financially literate and adopting lifestyle changes.
Read Also: Best Mobile Apps & Tools You Need On Your Phone To Achieve Financial Freedom
Of all the ways you can save, we’ve created a list of three of the simplest ways you can save a large amount of money only by making a few small tweaks to your current life.
1. Adjust your Lifestyle
Depending on your goals, intended retirement age, and spending habits, lifestyle changes and their effectiveness can differ from person to person.
Consider Downsizing
Nonetheless the general rule of thumb remains: downsizing your current lifestyle can save you some big bucks. Plan your big purchases like property or cars. Watch their trends and prices to get the best deals. Keep track of your debt, insurance premiums, and credit card payments.
Even small changes like taking shorter showers and reducing air conditioning usage can add up to a large amount over the years.
Read Also: 7 Ways to Save On Your Monthly Recurring Bills
If your goal is to save money, grow wealth, and potentially retire early, making adjustments to your lifestyle in-line with your long-term goals may be the best thing you can do for yourself.
Read Also: FIRE Movement: How to Retire Early Without Financial Worries
Take up Side-Hustles
Another pretty obvious way to save more is to earn more. Freelance side gigs like tutoring, driving, or setting up a service on Fiverr can easily make you up to S$500 a month which can cushion your savings immensely. This is the classic work-hard play-hard mentality that will allow you to save up without making any concessions to your current way of living.
Read Also: 5 Fun Side Gigs to Supplement Your Day Job Income
Embrace the 50/30/20 Rule
The 50/30/20 rule is a budgeting technique that offers individuals a quick and easy way to divide their earnings. Essentially this is a ratio that splits your earnings into necessities, savings, and other expenditure.
Using this rule, half of your total monthly income will go into paying for necessary items. This includes housing, transport, groceries, medical bills, and insurance premiums. The next 30% is spent on discretionary items such as shopping, restaurant meals, holiday expenses, etc. Some people carve out an additional 10% of this section to put into long-term investments. The last fifth goes into your savings. This is money you are not meant to touch unless an emergency occurs.
The 50/30/20 rule is a great way to evaluate your spending, plan ways to reach your financial goals, and instill a habit of saving. The rule isn’t too complicated but remains incredibly effective, making it the best option for both beginners and experienced savers alike.
2. Use Promotions
There are promotions on almost every item out there: insurance, credit cards, online shopping, buffets, you name it. There are numerous kinds of promotions out there but we’ll feature the two most popular, common, and easy to find deals that are guaranteed to save you your hard-earned money.
Early Bird Promotions
Some of the most worthwhile promotions are early bird promotions. If you know you want to do something in advance, be it attending an event, flying overseas, or buying a seasonal item, purchasing these earlier can save you a ton of money.
Sale Seasons
If you wish to buy something that you do not need urgently, more often than not waiting for a sale is bound to save you some cash.
Sales like the Great Singapore Sale or Shopee’s 11.11 sales offer some crazy savings on some of your favourite products and these happen every year. Other international events like Black Friday and Cyber Monday are also sure-shot sales that you can look forward to.
Pop-up sales also occur from time to time so be sure to keep track of all the promotions by following a site like ValueChampion that consolidates all the offers for you.
3. Shop Savvy
Rising inflation doesn’t mean you need to take a step back on enjoying your life, and this includes shopping. All it means is that you should be smart about how, what, and how much your purchases are. Keeping a good control over your expenses will allow you to continue shopping while still being financially savvy.
BNPL
Buy-Now Pay-Later apps like Atome have been gaining popularity recently. Over 1.1 million people in Singapore use this technology, making BNPL a great solution for those who wish to divide their purchases into smaller payments over a period of time.
The massive benefit of these BNPLs is that you can split payments across a few months while incurring no transaction fees and no interest rates. However, BNPLs can make it tempting to spend the money you may not have so be sure that you are able to pay back the full amount you’re borrowing by the deadline.
Read Also: Buy-Now, Pay-Later (BNPL) Programs in Singapore: Are They Really Worth It?
Cashback and Shopping Credit Cards
UOB KrisFlyer Card
KrisFlyer UOB Credit Card
UOB KrisFlyer Credit Card is a great option for SIA Loyalists who tend to fly on a budget.
Pros
- 3 mi per S$1 on SIA, SilkAir, Scoot & KrisShop
- Up to 3 mi on dining, transport, online shopping & travel
- Expedited KF Elite Silver status, Scoot privileges
- 10,000 annual bonus renewal miles
Cons
- Just 1.2 mi on non-category overseas spend
- No lounge access perks
- No spend-based fee-waiver
If you are going to be spending the big bucks on shopping soon, consider getting a UOB KrisFlyer Card to boot.
In one purchase make full use of the card to shop till your heart’s content while also gaining 3 miles per S$1 transaction on online fashion shopping by spending at least S$500 with SIA brands within the year.
The annual fee of this card is also waived the first year, so you don’t have to worry about incurring costs of owning the card anytime in the foreseeable future.
Citi Rewards Card
Citi Rewards Credit Card
Best credit card for shopping and earning rewards.
Pros
- Great for online & offline shopping
- Beneficial for frequent travellers
Cons
- Less valuable for infrequent shoppers
- Foreign transaction fees apply
If you primarily spend online & on fashion retail this is a great card for you.
Cardholders earn 10 points (4 miles) per S$1 spent on online purchases, shopping, rides (Grab, Gojek and more), online food delivery and groceries. Consequently, it’s rather easy for shoppers to earn rewards across a broad variety of spending categories.
Do note that the bonus rate of 4 miles per S$1 is capped at 3,600 miles/month (or 9,000 Points). This amount can be reached with S$1,000 spend, making Citi Rewards Card a great option for those with a similarly-sized monthly shopping budget.
DBS Woman’s Credit Card
DBS Woman's Card
DBS Woman's Card has great miles earning potential for frequent shoppers and travelers.
Read Full Review
Pros
- Good rewards for online shopping
- Online purchase protection
- 0% interest payment plans available
Cons
- Limited rewards categories, no rewards earned for non-online shopping local spend
If you’re going to make a big purchase that you would like to pay over time, this card is a great option for you. Cardholders earn 4 miles per S$1 on online shopping, 0.4 miles for local spend.
Furthermore, they can split transactions as low as S$100 into instalments across up to 12 months via DBS’ My Preferred Payment Plan. This has no interest or processing fee that you have to worry about.
Where to Keep Your Savings
Keeping a large amount of savings without receiving a good interest rate on them is not wise, especially when inflation is high.
For example, if you save S$1,000 right now with no interest rate, this money will remain the same. Meanwhile inflation continues to push up consumer prices as time goes by. The S$1,000 that can afford you an iPhone today may not do so in a year’s time. With a 4.2% core inflation in 2023, the same S$1,000 iPhone will cost S$1,042 in a year (assuming no extra price hikes by Apple).
So without getting any interest on your savings, your money loses its value due to inflation. Hence, it is important to not only save your money, but store it where you can receive a competitive interest rate.
Ideally, you should aim for a return equal to or greater than current inflation rates so that your money retains, if not grows in value.
Investments
By putting your money in relatively safe and secure investments with steady rates you can ensure that your savings do not lose their value over time due to inflation.
Read Also: All About Investing In Singapore
Exchange-traded funds (ETFs) such as the Straits Time Index or the S&P 500 are great options for those looking towards the stock market.
Real Estate Investment Trusts, also known as REITs, are another great alternative for those looking to invest in real estate without purchasing their own properties.
Read Also: Everything You Need to Know About Investing in REITs Safely & Efficiently
However, do keep in mind that all forms of investment have a certain amount of risk, even the most secure and historically successful ones. Always do your research and be confident in your decision before investing in anything.
However, do keep in mind that all forms of investment have a certain amount of risk, even the most secure and historically successful ones. Always do your research and be confident in your decision before investing in anything.
High-Interest Savings Accounts
If investing gives you the jitters (trust us, we know how that feels) high-interest savings accounts are your next best bet to ensure your money retains its value in the face of inflation.
Be sure to research the various interest rates, minimum deposits, and maximum interest earnings before you make the leap as these can differ significantly from bank to bank.
With some banks offering up to 7.8% interest, these savings accounts are the way to go to battle the damages caused by inflation.
Read Also: A Basic Guide to Savings Accounts in Singapore
Conclusion
All in all, inflation poses many problems for a Singaporean looking to save money but these can be tackled head on by making small lifestyle changes, using promotions, and shopping smart by utilising BNPL platforms and rewards credit cards.
Consumers also need to make sure that they are storing their savings in a place that provides them with high interest rates like a savings accounts or investments, so that their hard earned money does not lose its value in the long run.
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