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It’s the start of a new year, and something that’s always on our to-do list is finances. Many want to start the year off right, by organising their finances to ensure a successful and fruitful year. But then, many get stuck, pondering on where to begin. Here are five ways expatriates in Singapore can achieve financial success in 2025!
1. Create a Budget
Every great plan has sturdy foundations. That’s why it’s essential to develop a comprehensive budget that reflects your income and expenses. It’s crucial to account for factors such as housing, schooling, and healthcare.
Establish a monthly budget that includes all your necessary expenses—rent, utilities, groceries, and transportation—while also allocating funds for savings and discretionary spending. This will help you identify unnecessary spending and make adjustments to ensure you stay within your budget. I like to use the 50/30/20 rule (50% on necessary expenses, 30% on lifestyle & 20% on savings & investments) as a starting point.
2. Build an Emergency Fund
Life can be unpredictable, and having an emergency fund is essential for financial stability. Aim to set aside at least three to six months’ worth of living expenses in a high-yield savings account. This fund will act as a safety net in case of unexpected events such as job loss, medical emergencies, or urgent travel.
Establishing this fund will give you peace of mind and allow you to focus on long-term financial goals without the constant worry of financial insecurity.
3. Open an SRS Account
The SRS (Supplementary Retirement Scheme) is a voluntary savings scheme designed to encourage individuals to save for retirement while benefiting from tax concessions. Investing in an SRS account allows you to contribute up to SGD 15,300 (for Singaporeans and PRs) or SGD 35,700 (for foreigners) annually, depending on your residency status.
https://www.iras.gov.sg/taxes/individual-income-tax/basics-of-individual-income-tax/special-tax-schemes/srs-contributions
The contributions you make to your SRS account are eligible for tax relief, reducing your taxable income. Additionally, the funds in your SRS account can be invested in various financial instruments such as stocks, bonds, and mutual funds, giving you the potential for growth. I would strongly advise not leaving the money as cash within your SRS account, eroding against inflation and investing that money instead.
4. Invest Wisely
Following on from the previous point, investing is a key component of financial success. With the right approach, you can grow your wealth and prepare for the future. Consider your risk tolerance and consider diversifying your portfolio to mitigate potential losses. Understand your objectives, and remember that investing is for the long term, not just for the quick wins.
Seek advice from financial advisors to gain insights into the best practices for investing in Singapore.
5. Stay Informed About Tax Regulations
As an expat, understanding Singapore’s tax regulations is vital to your financial success. Familiarise yourself with the tax obligations that apply to you, including income tax rates and any reliefs or exemptions available. Consulting with a tax advisor who specialises in expat taxation can help you navigate this complex landscape and ensure you meet all your obligations while maximising any potential benefits. Remember, take into consideration the tax in the country you live in, the tax rules of your home country, and the tax rules of any country you have assets in.
Achieving financial success as an expat in Singapore is attainable with the right strategies. By following these five simple tips, you can set yourself up for a prosperous year ahead. With careful planning and discipline, your financial future in Singapore can be bright and rewarding.
The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.
The levels and bases of taxation and reliefs from taxation can change at any time. The value of any tax relief depends on individual circumstances. You are advised to seek independent tax advice from suitably qualified professionals before making any decision as to the tax implications of any investment.
Danielle Teboul
danielle.teboul@sjpp.asia
+65 84457792
www.selectinvestors.sg
The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives. Members of the St. James’s Place Partnership in Singapore represent St. James’s Place (Singapore) Private Limited, which is part of the St. James’s Place Wealth Management Group, and it is regulated by the Monetary Authority of Singapore and is a member of the Investment Management Association of Singapore and Association of Financial Advisers (Singapore). Company Registration No. 200406398R. Capital Markets Services Licence No. CMS100851. St. James’s Place Wealth Management Group Ltd Registered Office: St. James’s Place House, 1 Tetbury Road, Cirencester, Gloucestershire, GL7 1FP, United Kingdom. Registered in England Number 02627518.
