I’m sure many of us will want to achieve financial freedom as soon as possible.
But for most Singaporeans, even if we do not take a car loan, do not have credit card debt or have already fully paid off our university loans; there is one thing that we cannot avoid – our housing mortgage.
The hefty price tag is enough to make us wonder if a studio apartment is enough since we will probably have to slog most of our hours away at work anyway, to pay it off.
A loan tenure that stretches to our retirement at 65 is possible, however, imagine what it will feel like if our flat or condo is fully paid long before that.
Let’s breakdown how much an average Singaporean must earn to FULLY own a property in Singapore.
Caveat: We will be examining dual-income households for the purpose of this article.
Don’t be discouraged if the price seems out of reach
There are ways to reduce the costs of owning a home such as housing grants, as well as renting out rooms for a period of time. These can help you to repay your home loans faster.
Don’t put all your money into your home
Be careful not to overstretch yourself to afford a pricier home. You should not simply take on the maximum amount of debt you can just because you are allowed to do it – it may result in the accumulation of CPF accrued interest.
Additionally, you can unintentionally veer into ending up asset rich but cash poor by locking your money in a home. Trying to afford the most expensive home you can buy will likely make your life very stressful and may spell financial disaster for your family if someone gets sick.
Instead, buy a property you can afford and use the extra money to invest in your future retirement or enjoy life – going on holidays, splurging on indulgences or buying new gadgets.
Avoid being asset rich but cash poor.