3 things Singaporeans who are worried about the economy should do to protect themselves

We all have that super kiasu friend or colleague who always, always chooses to err on the side of caution because he's afraid some catastrophe will befall him.

This is the guy who was the biggest "guai kia" at school due to his fear of being victimised by teachers. As an adult, he's so heavily insured he'll practically become an overnight billionaire should any misfortune befall him.

You might laugh, but now that the economy is going to the dogs, you just might be feeling a little kiasee yourself. Given that employees in vulnerable industries are at risk of retrenchment, wage growth will be slow, the employment market will be tough for job seekers and businesses are going to be facing difficult times, here's what kiasee Singaporeans should do to protect themselves.

Be prudent with property purchases

Singaporeans have the bad habit of trying to buy the most expensive property they can afford. In 2014, the MAS revealed that 20 per cent of borrowers were overstretching themselves and spending between 40 per cent and 60 per cent of their monthly incomes on loan repayments.

Given the poor economic conditions that appear to be here to stay, prospective property purchasers should be careful when making housing choices, MAS has warned.

Even if you never default on your loan for the duration of the, say, 25 years of your mortgage, you could be left with little to survive on in retirement. Any reduction in income, such as due to job loss, could spell disaster.

And if you're thinking you can sell flip your property in a few years and make big bucks like people have been doing in the previous decade, don't get your hopes up. There's a good chance property prices are going to tumble further before the cooling measures come off.

Save and invest more

I think we can safely say that most Singaporeans know that if you ever want to stop working, you need to save money. And to make sure that money's not worthless by the time you're actually ready to stop working, you need to invest it so it grows.

But it's one thing to know you "should" be doing it, and another to actually do it. If this wasn't the case, we'd all have six-packs and glowing skin.

If you're worried about the tough economic times ahead, you should be challenging yourself to save and invest an even larger proportion of your income.

If you're one of the many middle class Singaporeans who're lucky enough to have cash for discretionary spending, it's always possible to cut corners in ways that aren't too painful, like using your neighbourhood ActiveSG gym instead of renewing your Fitness First membership, asking your friends to try out hawker dishes with you when you get together instead of going to expensive restaurants or just putting a cap on your shopping expenditure.

Make career decisions with greater caution

Changing jobs frequently has become a staple of many young Singaporeans' careers. And for a while, this actually helped many to climb the career ladder faster and get juicy pay increments.

But those days could be over. With companies in formerly robust industries like banking and oil & gas retrenching workers left and right, and a tougher employment market in the coming year, young Singaporeans should think twice before making rash career decisions.

Unless you can afford to sustain yourself through a long period of unemployment, the last thing you want to do is to quit your job without a new one lined up.

And even when you do manage to get a job offer, don't blindly jump ship without evaluating it first, as some impulsive young employees are wont to do when dissatisfied with their current jobs.

The article first appeared on MoneySmart

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