You living beyond your ability?

[Apollo]

http://www.straitstimes.com/Latest%2BNews/...ory_216836.html

 

Many families live beyond their means, have wrong priorities Community welfare organisations can help promote sound values: PM By Zakir Hussain

SINGAPOREANS who spend beyond their means and have to go to their MPs for help were placed under the spotlight by none other than Prime Minister Lee Hsien Loong on Friday.

He noted that as MPs, 'we often see families who have over-committed themselves financially' - for instance those who have been 'extravagant in doing up their homes using renovation loans', or 'bought expensive furniture or large screen TV sets on hire purchase'.

'The ones with the most serious problems have bought homes which are larger than they can afford, and taken mortgages which they are then unable to pay,' he said.

Mr Lee was speaking at the 60th anniversary dinner of the Malay Youth Literary Association (popularly known by its Malay acronym 4PM), a community welfare organisation that helps young Malays.

While families who live beyond their means come from all races, 'quite a few are Malay families', he noted.

'It is a sensitive matter to raise, but all MPs and social workers know that it is a real issue that needs to be tackled,' he added.

Contacted by The Straits Times, Tampines GRC MP Masagos Zulkifli said he sees at least one such case a week - for example, a family living in a flat it cannot afford, or one that needs help preventing its TVs or stereo sets from being repossessed.

Some come with the latest mobile phones, a clear sign they have wrong priorities, he said.

[Alpha78]

Buying on credit, malay families, sounds familiar.

 

Check this out, written by a malay. Similar to what PM said.

 

http://muhammad-ridzwan.blogspot.com/2008/...stallments.html

[Qpik]

Unfortunately, this syndrome is not restricted to races.

 

Know of pple who are high income earner yet their spending really

 

They can spend monies on dressing up, 4-D, pay minimum on credit card bill. Order the cheapest, eat others' pple food, come to splitting of bill pay for their own. Ask for lift home though u can be staying at the other end of Spore. Worse still, don't eat at hawker centre/kopitiam.

[Pringles]

Some of the policies are to be blamed. For example cars. By removing the 30% downpayment requirement and the emergence of cashback, which in itself is a huge trap. This enticed many who rightfully cannot afford a car to over extend themselves.

The economy is likely to hit a bad patch. Problem is many youngsters do not plan long term. 10 years' loan is a long time. A lot of things can happen. Many who pay the minimum initial will no doubt be facing negative equity all the way till the end of the loan.

[Qpik]

but there are those who really need a vehicle for work/family reasons.

 

They are deterred by the cash upfront and high interest levied on 2nd hand car so they settled for new car albeit small one and go for 10years loan.

 

I know "can't afford the initial pymt etc etc why get car, subsequent maintenance/petrol/erp/parking how to cope" remarks will come up. But, if there's are cheap alternatives, I'm sure many will opt for it rather than be slave to 4 wheels.

[Wind30]

I think nobody really NEEDS a vehicle. There are always ways to work around it.

 

getting a 10 year loan with cash back is just making it worse....

[Octopus]

[reply]

I think nobody really NEEDS a vehicle. There are always ways to work around it.

 

Those people doing outdoor sales would find it difficult to do their job without a vehicle... I think even some job advertisement stated 'preferably' applicant whom own a vehicle...

[Rickster]

Some of the policies are to be blamed. For example cars. By removing the 30% downpayment requirement and the emergence of cashback, which in itself is a huge trap. This enticed many who rightfully cannot afford a car to over extend themselves.

The economy is likely to hit a bad patch. Problem is many youngsters do not plan long term. 10 years' loan is a long time. A lot of things can happen. Many who pay the minimum initial will no doubt be facing negative equity all the way till the end of the loan.

 

I think its more of our upbrining that needs to be blamed. Not the avilbalility of 100% installment plans. Blaming the installment/cashback policies is akin to blaming rape victims for being beautiful/sexy.

[Rickster]

If you are working as an outdoor sales, you will know there vehicle is a need Don't forget sales pple who need cars usually will need to carry alot of samples and/or portfolio around. Sometimes all these things are quite bulky and heavy.

 

On top of that, the car serves as a "value-added" tool for your customers.

[Ahhuat]

that's true.. but there are many misguided souls who convince themselves that they NEED a car...

[Throttle2]

yes dude, you hit the spot

[Mage]

then don't choose sales job la.. i know some who intentionaly chose a sales job so to justify their "need" to buy a car

[Ender]

Agree with some jobs need a car and usually the pay and benfits should be enough for him to live within the means. Those with jobs that need a car, and are finding it difficult to live within his mean, then perhaps this job is not the right one.

[Arowana1]

Some of the policies are to be blamed. For example cars. By removing the 30% downpayment requirement and the emergence of cashback, which in itself is a huge trap. This enticed many who rightfully cannot afford a car to over extend themselves.

The economy is likely to hit a bad patch. Problem is many youngsters do not plan long term. 10 years' loan is a long time. A lot of things can happen. Many who pay the minimum initial will no doubt be facing negative equity all the way till the end of the loan.

 

why do people need policies for self discipline and good financial planning?

 

based on this statement alone, gahmen will introduce bizarre scheme like where all our pay go to them and they issue to us on a need-to basis. juz like parents controlling their kids pocket money! no way, we dun want that! education is the best approach and if some families do not know how to plan, let them suffer! we cant have some bad apples affecting all of us!

 

if people had been clever with their cpf in the past, gahmen would not have an excuse to hold ours back now to ensure we have money until the day we die.

[Wind30]

yup agreed. Nobody forces you to take the sales job. You have to work out the sums. Is there an another job that doesn't require a car?

 

If your job requires a car, usually you get a good car allowance which should be enough to cover for a small car anyway. If your job doesn't make enough for you to buy a car comfortably and requires you to get a car.... errr.... isn't there something wrong?

[Ghostrider]

Not racist...but I see many young malay family falling into this trap...

 

Young couple with 1 or 2 kids...with $10....they can buy a whole load of stuff at Courts...and then after a few months...problem start liao.

 

This was according to a friend who use to do repo for Courts.

 

Its a credit trap waiting to suck in people....

[Pioneer]

Car is only part of the problem. It is the way we spend and the way we are brainwashed to brain.

 

Let look at the few things that are part of our lives.

 

Marriage

 

I still do not understand why singaporean feel that hosting a wedding dinner is a must, the de facto standard if they cannot really afford it. How many singaporean spend a huge portion, if not all their savings on marriage, from photo shoots, wedding dinner, diamond ring, preparation, etc etc.

 

Everyone say that getting married is an expensive affair that needs 10s of thousands. Does that mean that poor people cannot get married? It is but a perceived standard that we trapped ourselves in.

 

Housing

 

Another trap. Everyone wants to live in condos or private housing. Can all of us afford it. Recently got one stupid real estate agent put a claim that if a couple is earning 8k GROSS, they can afford a 700k house comfortably (Have to take a 35-year loan and pay 2.3k a month -> 200K+ of interest)

 

Exactly what is so wrong about public housing? But of course if you can well afford private property, you should go ahead. But of the people living in private housing, do we not agree that they are people who shouldnt have bought them in the beginning?

 

 

 

 

To think about it, the commercial world has always aim at man to spend. It is always "because she is worth it..... it is a once in a lifetime affair..... blah blah"

 

If the size of the diamond is related to our love for our woman, I concluded that then how much a man can love a woman depend on how much he has.

 

Look at the hollywood stars, they buy diamond worth as much as millions of dollars, did their marriage last FOREVER?

 

Expensive marriage, house, cars, rings, etc are things that are good to have, leaves a memorable experience in your lives. But if spend beyond your means to get those things, you will be so caught up in debts and loans that whatever memorable memories you have becomes your regret in your lives.

 

The amount of money you spend in your wedding does not proportionally related to your bliss and love in a marriage.

[Coolad]

Some of the policies are to be blamed. For example cars. By removing the 30% downpayment requirement and the emergence of cashback, which in itself is a huge trap. This enticed many who rightfully cannot afford a car to over extend themselves.

The economy is likely to hit a bad patch. Problem is many youngsters do not plan long term. 10 years' loan is a long time. A lot of things can happen. Many who pay the minimum initial will no doubt be facing negative equity all the way till the end of the loan.

 

That;s very true... those low downpayment and 10yr loan are really killers. But they(buyers) have themselves to blame. I can never understand how can one sign on the dotted lines for a >50K item without reading the terms and conditions carefully.

 

Example

suppose car 50K, signed on 10yr loan, insert key into new car (straight away considered 2nd hand), car value becomes 40K on 1st day... amt owe to bank 60K... immediately deficit of 20K... "chained" to the car... unless you have 20K to redeem urself...