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3 Reasons Singaporeans Should Be Worried About Their Money In 2017

January 6, 2017

So 2016 has come and gone and oh what a year it was. The National Day Parade returned to the National Stadium after 10 years, the Fed raised rates for only the second time in a decade and U.S. presidential elections were won by the candidate most did not expect – Donald Trump.

2016 may have been a tough year, but fair warning, 2017 looks like it might be worse (financially) and here’s why:

Interest Rates to rise

Perhaps no one was surprised when the fed raised interest rates in the final month of 2016, since everyone had expected a rate hike to occur sometime in 2016. 2017 seems like the year when rate hikes will gather steam, with projections showing that central bankers expect three quarter-point rate increases in 2017.

What does this all mean for the average Singaporean though? For one, if you already have a home loan that’s pegged to SIBOR or SOR, expect a higher interest payment soon as rates may rise in line with the fed rate hike decision last month and the expectation that there will be more to come in 2017. So if you have a loan or are looking to get one, be aware, interest rates may soon be on the move.

A great way to soften the blow of rising interest rates is to refinance your home loan. Learn more about refinancing and see live rates here!

However in a broader sense, the impact of higher interest rates has a larger more dire impact on the economy in general. 5 companies including Swiber holdings defaulted on corporate bonds worth nearly $1 billion in 2016 and Singaporean companies have a debt to equity ratio that has risen from 16% to 43% in 5 years. Higher interest rates could hurt companies that are over leveraged, hurting the general economy.

Property Prices To Soften

As though rising interest rates weren’t enough to worry about for home owners in Singapore, there’s an expectation that private home prices will continue to ease further in 2017. Since reaching it’s peak in the third quarter of 2013, Home values have since shed 11.2%.

“Due to the lack of positive economic news, we are expecting that prices will generally continue their decline. However, buyers may capitalise on this continued window of falling prices to snag some attractive deals.”

Eugene Lim
Key executive officer
ERA Realty Network

The Job market Looks Increasingly Challenging

2016 was a year of layoffs with more than 13,000 redundancies in the first 9 months of 2016, putting it on course to be the worst year (redundancy wise) since the 2008 financial crisis period where more than 23,000 jobs were lost in 2009.

The bad news? Well, 2017 doesn’t look like it’ll be much better.

“In general, employers will be more cautious with their hiring plans as they take a wait-and-see approach. Most companies would not expect to grow their headcounts,”

Ms Linda Teo,
Country manager
ManpowerGroup Singapore.


A survey conducted by ManpowerGroup found that Employers in the Wholesale Trade and Retail trade segment in particular reported the weakest hiring plans since the second quarter of 2009 with a Net Employment Outlook of -2% for the first quarter of 2017.

Add to that the fact that laid-off workers are increasingly finding it difficult to find new jobs simply because they don’t have skillsets that are in demand. With a report by MAS noting that “there appears to be a higher degree of mismatch among resident professionals, managers, executives & technicians (PMETs). Notably, PMETs accounted for more than two-thirds of the residents laid off in H1 2016, larger than their share in the workforce.”

That brings our article to an end, but if you think we left something important out, do feel free to leave a comment in the section below! Love this article? Share it on Facebook! Think we’ve written something awesome and want to get more awesome updates? Subscribe to our Email Newsletter! or like us on facebook!


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Gerry has spent time working in 5 different banks in various capacities, across a range of functions from back to middle and front office. After leaving banking, he spent time working on market research for consumer banking with a focus on the Chinese and Singapore market. He now serves as a home loan consultant and business manager of Easyrates.

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