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 undischarged 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.
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Civil servants in Singapore, like anyone else, can experience financial difficulties due to a variety of reasons, such as job loss, medical expenses, or overspending. While the job security and steady income that comes with being a civil servant may provide some financial stability, it is still important to practice good financial management and plan for unexpected events.
To avoid financial embarrassment, civil servants in Singapore can take the following steps:
Budgeting: Create a budget and stick to it, to ensure that expenses do not exceed income. This can help to avoid overspending and build up savings for unexpected events.
Debt Management: If necessary, seek help to manage debt and prioritize repayments.
Savings: Build up emergency savings to cover unexpected expenses, such as job loss or medical expenses.
Investment: Consider investing in diversified portfolios to grow wealth over the long term.
Financial Planning: Seek professional advice to develop a comprehensive financial plan that takes into account one's current financial situation, goals, and risk tolerance.
In conclusion, financial embarrassment can have a negative impact on personal and professional lives. Civil servants in Singapore, like anyone else, should be concerned about financial embarrassment and take steps to avoid it, such as budgeting, debt management, savings, investment, and financial planning.