Thursday, October 10, 2019

Singapore Civil Service - Declaration of Indebtedness and Financial Embarrassment

Civil servants or public officers in Singapore are expected to declare their financial standing when they first join and every year thereafter or whenever their  unsecured financial liabilities exceed 3 months salary.

This declaration of indebtedness is meant to ensure that civil servants remain of good financial standing and helps the Public Service know whether an officer becomes vulnerable due to financial embarrassment.  The intention is meant to protect the officer (and by extension the Public Service) and is not meant to penalise the officer.

An officer is considered to be financially embarrassed if he or she has defaulted in repayment of loans, credit facilities and liabilities for 3 consecutive months.

Other situations where one is financially embarrassed also include being an umdischarged bankrupt or where one takes a loan outside certain categories.

So this means that if one has not been making payments for credit card bills for 3 months consecutively, one will be considered financially embarrassed.  Or if one has borrowed from a money lender,  one will also be considered financially embarrassed.

So a civil servant must be careful to take only secured loans like housing or car loans. Other loans such as education loan, renovation loan is also allowed.  Unsecured loans like balance transfer or credit cards must be capped at 3 months salary.

A civil servant who is financially embarrassed must declare.

Tuesday, October 8, 2019

Rental Income or Dividend Income

Which is better? Rental income or dividend income?

Having both rental income and dividend income,  I can say that I actually prefer to collect dividend income.

In Singapore, I don't have to pay taxes on dividends. But I have to pay taxes on my rental income.

Also, rental income is taxed at one's income bracket and that results in a lower yield from whatever rent I collect. 

If using a housing/ real estate agent, one also has to pay the agent commission ranging from 1 to 1.5 months rental.  This alone can be quite significant.

In terms of passiveness,  there is work involved too in terms of finding tenants paperwork, etc.

On the other hand,  dividend income is fairly straightforward.  No taxes,  no hefty commissions to be paid, and relative ease in terms of monitoring (assuming one is buying a good quality income).

This is not investment advice. Purely stating my preference as a very lazy investor.

Monday, October 7, 2019

Still Alive & Kicking

Haven't written in a long while. The last time I logged in to blog was probably 1-2 years back.

Everything is fine.  Just saying hi to all my readers. 

Still alive and kicking!

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