What Happens If: You Lose Your Job in Singapore and Have No Savings

Ryan Ong

Ryan Ong

Last updated 19 September, 2016

What Happens If, a SingSaver series, lays bare all the likely personal finance scenarios that could hit you at any stage of your life. After all, it never hurts to be prepared.

Make these financial moves within a week of losing your job, so you can survive unemployment in Singapore even if you have no savings.

This article was originally published on 11 May 2016 and updated on 19 September 2016.

Layoffs have continued to happen to many Singaporeans during the second quarter of 2016. A recent article in The Straits Times reports that the unemployment rate in Singapore rose to 3.6% in June, and that it took an average of 25 weeks for retrenched workers to find jobs. For the first time in four years, job seekers in Singapore outnumber job vacancies available.

If you have recently lost your job and have no savings, you need to take some quick financial steps within one week of being retrenched. The sooner you get things in place, the faster you’ll bounce back.

make an emergency budget

Your emergency budget should consist of your daily spend if your current savings are stretched over six months


Build an Emergency Budget

At SingSaver.com.sg, we advocate saving 20 per cent of your income each month, until you  build an emergency fund of six months of your income. It is precisely in order to cover situations such as retrenchment.

If you haven’t already, we suggest you start doing so immediately. You don’t have to build it within a year or even three; just keep saving regularly until you reach the required amount. Meanwhile, you need to live on an emergency budget until you find a new source of income. Fortunately, living on a budget is not difficult for a short period.

The easiest way to do this is to work out how much you can spend per day if your current savings are stretched over six months. If you have S$24,000 saved, for example, you would cap your spending at around S$133 per day. Of course, this amount will be reduced by other costs such as power bills, the mortgage, and various obligations.

Develop a Strategy for Where and How You Buy

When your income stops, you can no longer afford certain conveniences. One of these, sadly, is the ability to buy without too much checking. From the first week onward, you will have to be pickier.

Check out the groceries you buy every month and go online to find cheaper alternatives. Set up notification services so you know when toiletries, food, or other essentials go on discount. Several online grocery sites, such as HonestBee, can help you compare prices and find the lowest cost alternative. You can also follow our blog for updates on saving tips.

For other items, try to buy cheap or second-hand on Carousell, Ebay, or related sites. These days, the share economy is advanced enough that you may not need to step into a mall for months.

Avoid buying on credit at all costs; always pay in full. If you use a credit card for the cashback, make sure you repay the full amount. Interest rates will raise your monthly repayments, which you cannot afford at this point.

Once you’ve picked a list of places you can buy from and a mode of payment to use, be disciplined and stick to it. Don’t even walk into a shop unless you absolutely have to, in order to minimise temptation. From this point forward, you should search for exactly what you need, and buy only those items at the cheapest cost. No browsing.


talk to your insurance agent

If you have insurance policies, make sure they do not lapse

Call Your Insurance Agent


If you have one, your first port of call is your financial advisor or insurance agent. The most important thing is not to let your insurance policy lapse. It is when you are unemployed that you most need financial protection.

You may be forced to change policies if you can no longer afford existing premiums. Most insurance agents can help you find an alternative, and minimise the impact of switching policies.

You will also have to revise your long-term financial plans - this could mean selling off some of your existing assets, in order to provide until you find a new job. Selecting which of these assets (stocks, bonds, etc.) to let go off shouldn’t be a DIY process; always get professional advice on what to let go of, and how to do it. Selling the wrong asset at the wrong time could lead to a serious loss.

Consolidate Your Debts

It is important to minimise loan repayments over the coming months. The less you have to pay out each month, the more time you have to find a new job.

Look through your debt obligations, and pick out high-interest rate loans. These are usually credit card debts (around 24 per cent per annum), or personal loans for which better alternatives exist (usually six to eight per cent interest per annum). By finding the right loan options, you can convert your high-interest rate loans to cheaper ones.

For example: say you owe S$2,500 on your credit card, at 24 per cent interest per annum. You could take a personal loan for S$2,500 at just six per cent per annum, and use the money to pay off your credit card. In this way, you’d convert a higher interest rate into a lower one.

You can find the lowest interest rate loans on our Singsaver website. Use the comparison tools to check offers from all the banks; you can apply for the cheapest one directly from the site.

If you have multiple credit card debts that add up to 12 times your monthly income or more, a debt consolidation plan can help you manage your payments.

dont accept the first job

Don't say yes to the first job offer you receive



Find a Source of Side Income While You Job-Hunt

From day one, you should be seeking side-income. Send out emails asking if your friends or relatives need a tutor, for example, or whether they will pay for tasks like revamping their website. Even a side-income of S$200 to S$300 can make a world of difference, by covering your bills and preventing a debt spiral.

See Also: 5 Side Income Jobs Almost Any Singaporean Can Do

Do not focus too much on the issue of skills: many side-income opportunities will have little relevance to your actual qualifications. For example, you may be a qualified accountant, but if someone will pay you to wallpaper their living room, then take a deep breath and do it. Stock shelves for a mini-mart if you have to. Don’t waste time being picky, and trying to find side-income that also matches your career skills; it’s is a common mistake that delays earnings.

Save your qualifications and talents for the true job hunt. Side income is just grunt work people will pay you for while you find another job.

Allow at Least 3 Hours Before Saying “Yes” to the First Job Offer You Get

When you are retrenched, you’re often in a panic and eager to accept the first thing that comes your way. This often includes low-paying jobs or opportunities that will destroy any semblance of work-life balance. So for the first week at least, give yourself a three hour “think period” before accepting any new jobs.

Don’t jump into a lower paying job out of fear, and end up stuck with lower pay for the next few years.

Read This Next:

6 Reasons Loans from Moneylenders Mean Trouble
7 Must-Do's to Survive a Drastic Paycut in Singapore

By Ryan Ong
Ryan has been writing about finance for the last 10 years. He also has his fingers in a lot of other pies, having written for publications such as Men's Health, Her World, Esquire, and Yahoo! Finance.

Ryan has been writing about finance for the last 10 years. He also has his fingers in a lot of other pies, having written for publications such as Men’s Health, Her World, Esquire, and Yahoo! Finance.


Use a personal loan to consolidate your outstanding debt at a lower interest rate!

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