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2-Cent Rant

5 Important Financial Questions For Singaporeans To Think About In 2018

These are the biggest trends that will affect your financial life in 2018. Have you given them any thought?

The end of the year is a time for quiet introspection. The year 2017 is nothing, if not eventful.

Here are five of the biggest waves in 2017 that will continue to have ripple effects for Singaporeans into 2018.

#1 Bitcoin, Blockchain, ICOs

The price of one Bitcoin is now… Never mind. Bitcoin’s price when you’re reading this will most likely be wildly different from when this article was written. Herein lies the uncertainty and (some say) opportunity.

Retail investors and basically anyone who frequents Facebook groups are rushing to buy Bitcoin. Never mind that many of them ignore or are ignorant of glaring Bitcoin risks. Or the fact that they may not have the know-how to properly encrypt and protect their e-mail, let alone their precious cryptocurrencies.

If 2017 is the year of Bitcoin’s astronomical rise, will 2018 be the year it continues to accelerate out of the atmosphere? Or will gravity catch up with it and everything burns up upon re-entry?

Bitcoin mania aside, there is no doubt that blockchain technology has immense potential to change the way banking and other financial services are carried out. Companies from the well-established hundred-year-old banks to days-old startups are rushing to create products and services based on this new paradigm.

ICOs have been growing in popularity this year too. While there are many legitimate and promising businesses that choose to raise capital in this way, it is hard to distinguish the good from bad just by looking at a PDF white paper.

Will the bad apples in this space undermine public trust in the genuine technological potential of blockchain and ICOs?

Read Also: Thinking Of Trading Bitcoin? Here are 10 Things You First Need To Know Before Starting

#2 The United States, China and Other Geopolitical Challenges

Regardless of your political views, it is an undoubtedly a very volatile geopolitical climate.

With tensions on the Korean peninsular and global security threats, the Doomsday Clock is ticking closer than ever to midnight, that is, the brink of nuclear disaster.

China’s ascendency is accompanied by its increasing assertiveness in territorial disputes in the South China Sea, much to the ire of neighbouring countries. As the “factory for the world”,  there is also concern over how its fiscal policies will affect world markets and prices.

The United States moves ahead to implement policies and pronouncements under the Trump administration. In our ASEAN backyard, our neighbours continue to face grave threats like civil unrest, ISIS takeovers, and economic challenges.

The Singapore economy has large exposure to global events, especially with the United States and China. Will Singapore be able to navigate 2018 with wisdom and agility? Here’s another important question worth asking: How much of your investment portfolio has exposure to these global markets?

Read Also: What Does An Improved GDP Mean For Singaporeans In 2018

#3 Property Prices in Singapore

After 15 consecutive quarters of decline, 3Q2017 finally saw a modest reversal in property prices in Singapore.

After four long years, this is good news for property owners and real estate developers. The huge numbers of en bloc properties this year, as well as failed bids, might hint at 2018 being another decent year for en bloc sales.

However, optimism should be tempered seeing that cooling measures do not look like they will be lifted any time soon.

As DollarsAndSense Managing Editor Timothy Ho wrote previously, “The property market today is attractive for you to consider for your own home stay as prices have (rightfully) declined. However, if you are intending to buy a property to generate investment returns, you may be better off considering other property investment opportunities such as REITs or property developers themselves.”

We’ve explored the question previously, and it remains on our minds: Is 2018 the right time to start investing in private properties again?

Read Also: [Beginners’ Guide] Buying A Property In Singapore

#4 The Changing Job Market

Even though statistically at 2.2%, the resident unemployment rate is pretty low, anecdotally the feeling among Singaporeans is that the job market is still pretty tough.

Many young Singaporeans are grappling with the new realities of the workplace, where contract work is becoming the norm and honing new skills on the job is a given.

The high cost of living and aspirations of young Singaporeans mean that there is much pressure to earn more money, leading to people taking on “side hustles” and freelance work even during their time as tertiary students.

DollarsAndSense continues to write regularly the evolving job market and how to thrive in your career. The big question we have is: What should we do today to be ready for tomorrow?

Read Also: I Just Got My First Job. How Much of My Salary Should I Be Saving?

#5 Zero Percent Car Growth and COE Prices

It was announced in November that the car growth rate in Singapore will be changed from 0.25% to 0% from February 2018 onwards. This is part of a larger effort to nudge Singapore into a “car lite” society.

Despite assurances from the Singapore government that this will not affect COE prices significantly, there has been disquiet among Singaporeans, many of whom see car ownership as necessary and important for the kind of lifestyle they wish to have. In fact, Christopher Tan of The Straits Times estimates that the zero percent car growth rate will mean that nearly 400,000 people will lose access to private transportation by 2023.

In the context of an ever-increasing influx of people from abroad coming to Singapore to work and study, the key question is whether Singapore’s rail operators can somehow muster the ability to improve public transport reliability and if other transport options like taxis and private-hire car services, like Grab and Uber, can keep Singapore’s families, workers, and companies going whether they want to go.

Not being able to do so will impact Singapore’s attractiveness as a place of business.

Read Also: COE Quota Is Cut Again. What Will Happen To Car Prices In Singapore?

What Are Your Questions for 2018?

What are the burning financial questions on your mind as we head towards 2018? Let’s discuss them on our Facebook page! aims to provide interesting, bite-sized and relevant financial articles.

Learn together with like-minded Singaporeans at the Personal Finance Discussion SG Facebook Group by discussing a range of personal finance topics.

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