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5 Things Singaporeans Should Do Today To Reduce Their Expenses During This “Circuit Breaker”

Free time on your hands? Here are some ways to reduce your expenses – without cutting your Netflix subscription.


As of 1 April 2020, more than 60,000 people have applied for the Temporary Relief Fund. This fund gives a cash grant of $500 to those who have lost their jobs or income due to the COVID-19 outbreak.

Even for those who remain fortunately employed, financial security should continue to remain at the top of our minds. More than 2 million people have been infected by the virus, and cases continue to rise each day. The pandemic has pushed the world economy into a 12% contraction in the first quarter. In such economic uncertainty, we’d want to exercise greater prudence. Now that most of us are staying home, what are the ways that we reduce our expenses during this circuit breaker period?

#1 Switch To An Open Electricity Market (OEM) Retailer

With most of us working or studying from home now, we can expect a rise in daily electricity consumption. Given that this will add on to your overall household expenses, it’s timely for us to make the switch.

With the Open Electricity Market (OEM) initiative rolled out nationwide last year, we now have the freedom to choose which electricity retailer to go for. One of the biggest incentives to switch to an electricity retailer is the cost savings of up to 20 to 30%, compared to the regulated tariff.

Currently, the tariff rate is at 23.02 cents per kWh, effective from 1 April to 30 June 2020. The prices charged by OEM retailers are lower, for instance, Ohm Energy’s Fixed Ohm plan charges 18.90 cents/kWh over 24 months. Ohm Energy received one of the highest ratings in terms of overall satisfaction level, according to a survey done by Energy Market Authority last October.

If you want to ensure immediate savings, go for the Discount Off Regulated Tariff plan instead. Such plans offer a discount off the regulated tariff, which can be a helpful start for those overwhelmed by the sheer number of factors to consider.

Read Also: [2020 Edition] Complete Guide To Choosing The Best Open Electricity Market (OEM) Plan For Your Home

#2 Consider Refinancing Your Home Loans

Given that the interest cost is one of the largest expenses associated with our property purchase, it might make sense to refinance our loans for greater savings. Refinancing a home loan refers to switching your current home loan package to a new one with another bank.

You’d want to refinance for a few reasons: to enjoy lower interest rates, to lower payment amounts or to convert from a floating-rate to a fixed-rate mortgage. Most home loan packages are locked in on a lower rate for the first three years, before rising on the fourth year.

Aside from that, local banks are also lowering fixed rates and increasing spread in floating rate packages, triggered by the Fed’s rate cuts in March. This is further supported by data from Property Guru, where home loan interest rates now can be as low as 1.27%. Thus, it might be more attractive for homebuyers to refinance their home loans now, though we should also not expect such low rates to continue indefinitely.

If you find it a hassle to research and shop for the best rates out there, consider getting a broker to help manage your refinancing decision. Home loan brokers, for instance, perform this service for free, with their commissions coming from the banks.

Read also: Step-by-Step Guide to Refinancing Your Home Loan

#3 Consider The Credit Cards You Have

Relook all the credit cards you have, and consider if you are fully utilizing the benefits with your current lifestyle habits. For instance, with the uncertainty around future travel, you might not be using your travel credit card benefits anytime soon. You can consider downgrading them to retain your credit history. Or if the perks of certain credit cards are not justifiable in view of your current lifestyle, a cancellation might be in order. But as always, consider the impact that cancelling a credit card can have on your credit score.

If you face trouble in paying your credit card bills, you might want to consider doing a credit card funds transfer to consolidate your outstanding debt. With a credit card fund transfer, you move high-interest credit card debt to another credit card of a lower interest rate. This way, you incur fewer fees and interest charges.

Read also: Here’s How You Can Avoid Paying Annual Fees For Your Credit Cards In Singapore

#4 Relook Your Savings Account

For those who do not yet have a high-interest savings account, it’s time to use your newfound stay-home time to get that in order. Choosing a good savings account is a low-risk way to stretch your dollar, so long as the transaction conditions are met.

While the COVID-19 outbreak has led to local banks revising interest rates on savings accounts, it still beats the rates offered by regular savings accounts. In particular, DBS Multiplier, OCBC 360 and UOB One will be implementing changes to their interest rates, explained in greater detail in our previous article.

Read Also: [2020 Edition] Best Savings Accounts for Working Adults in Singapore

#5 Review Your Insurance Coverage

As with any fiscally responsible adult, we purchase insurance for financial protection. But some of us may be unknowingly over-insured, and forking out larger than necessary premiums as a result. If the circuit breaker measures have given you more time on your hands, dig up your insurance policies to understand the extent of coverage that you have and if there are any overlaps.

If you are overpaying for insurance, this eats into other financial goals such as savings, investing, or retirement planning. If need be, get a trusted insurance agent to work out your insurance portfolio, and work together to cut down on excess if you find that the cost of your coverage is too high.

Read Also: Options To Consider If You Can’t Afford To Pay Your Insurance Policy Premiums During Times Of Financial Hardship

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