1 in 3 S’pore investors in debt, survey finds

SINGAPORE — Even without including housing loans, one in three investors here are saddled with debt, mainly because of living expenses such as food, utilities and transportation and domestic helpers, a survey showed yesterday.

The 33 per cent figure of investors in debt in Singapore places the Republic third among eight Asian markets surveyed, behind Malaysia’s staggering 68 per cent and Philippines’ 41 per cent, according to the Manulife Investor Sentiment Index.

The top contributors to debt in Malaysia were daily living expenses, followed by rental payments. 

Hong Kong, which is often compared with Singapore, had the third-lowest proportion of investors in debt, at 22 per cent, although they suffered the most from investment losses. Mortgages were excluded from the survey.

Of the Singapore investors in debt, nearly half, or 46 per cent, owe at least S$10,000, with 44 per cent expecting to take more than one-and-a-half years to clear their debts. This is in spite of investors here saving an average 47 per cent of their monthly income, compared with the regional average of 42 per cent, the survey showed.

“Singapore investors are taking steps in the right direction by working hard to keep track of their expenses and save for retirement. However, their debt burdens may be holding them back from achieving their financial goals,” said Manulife Singapore’s President and CEO Naveed Irshad.

In terms of gender, the survey found that more male investors (37 per cent) are in debt, compared with their female counterparts (28 per cent). The men also have a significantly higher average debt amount of S$40,985, compared with S$25,502 for females.

The survey, conducted every half a year, measures and tracks investors’ views on their attitudes towards key asset classes and issues related to personal financial planning. It is based on 500 online interviews in each of the markets of Hong Kong, China, Taiwan, Japan, Singapore, Malaysia, Indonesia and the Philippines, it said.

The survey also showed that the majority of Singapore investors, or 69 per cent, regret not being better at planning their investments. Some of the most commonly cited reasons for this regret include not being more proactive in reviewing their portfolio (27 per cent), and holding on to too much cash instead of using the money to make more investments (26 per cent).

Separately, a consumer confidence and spending survey by Nielsen showed yesterday that Singapore consumers are cutting back on lifestyle expenses, including shopping for clothes and going on holidays. They are switching to cheaper grocery brands and saving on gas and electricity, amid concerns over the global economic uncertainty.

This came as Singapore’s consumer confidence fell by seven points to 94 points in the last three months of 2015, below the global average of 97. The Republic’s consumer confidence was lower than that of Hong Kong (99 points) and China (107 points), but higher than Malaysia (80 points) and Japan (79 points). Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.

Correction: An earlier version of this report misspelled Manulife Singapore’s President and CEO Naveed Irshad's name. We also reported that the top contributors to debt in Malaysia included discretionary expenses including clothes, entertainment and travel. This is incorrect. The top contributors to debt in Malaysia were daily living expenses, followed by rental payments. We are sorry for the errors.