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8 Ways to Spring Clean Your Finances before Lunar New Year

23 December 2019 | 3-mins read

The spring cleaning before Lunar New Year is the probably most thorough cleaning you will do in the entire year. Besides dusting and mopping, you need to throw out dead plants, broken objects and unwanted clutter. This gets rid of last year’s bad luck and makes space for new energy and good luck.

How does personal financial management come into this equation? Similar to applying the “Konmari” method in decluttering your home, it is good to take this opportunity to clean up your financial life and make room for wealth that is sure to come. Here are 8 ways to freshen up your finances in time for the Lunar New Year.

Spring Cleaning for CNY Taken from Unsplash (

1 – Toss out unused subscriptions

It is easy to forget a service which you previously subscribed to. Free up some cash by reviewing your existing subscriptions and canceling what you do not use.

To do this, log into your bank account or credit card app. Look at your statements for the last three months and list down every subscription. Some examples include mobile phone, cable TV, internet, entertainment (i.e. Netflix, Hooq), dining memberships (i.e. The Entertainer), gaming, or gym memberships.

Then, write down each subscription’s annual cost.

When deciding which subscription to toss out, here are some questions that you can ask yourself:

  • Do I use it and like it? Cancel if the answer is no.
  • Does this save time, energy, or make me money? Cancel if the answer is no.
  • Is it worth that much to me? Cancel if the answer is no.
  • Is there a cheaper alternative that works the same? Cancel if the answer is yes.

With Goods and Services Tax being collected for overseas digital services subscriptions from 2020 onwardsi, there is never a better time to review and terminate the unutilized ones to save some money.

2 – Revisit your budget

Budgets are essential to maintaining financial order. Besides managing monthly expenses, a budget lets you plan upcoming expenses and save for long-term goals. Without a budget, you might not know that you are heading towards financial danger.  

For a monthly budget to work, expenses must be projected as accurately as possible. Fixed expenses like your mortgage, car payments, and utilities are simple to predict. But variable expenses like food or entertainment fluctuate every month.

To estimate your variable expenses, personal finance writer David Weliverii recommends looking at credit card or bank statements for the last 3 months. Then, group these expenses into categories like transportation, household items, entertainment, clothing or dining out.

Subtract your monthly fixed expenses and variable expenses from your monthly income, like so:

Monthly income – fixed expenses – variable expenses

Are your expenses far less than your income? If so, congratulations! You are living below your means, and your surplus cash can fund long-term goals like retirement.

Did you end up with a negative number? You may go into debt if you keep this up. Look at your expenses and see which variable expenses you can reduce or throw out.  


Talk to our financial consultants today!

Spring Cleaning for CNY Photo by The Creative Exchange on Unsplash (

3 – Clear your high-interest debts

Clearing your debts before the Lunar New Year is more than a superstition – it is a good financial habit.  Personal finance expert Suze Orman advises eliminating debt as soon as possible, and not just because it costs money. She points out that debt affects other parts of your life, keeping you from earning more and taking a toll on your emotional healthiii.

Having debt is not all bad luck, though. There are manageable debts like mortgages, which result in something beneficial and are easily paid through monthly installments. It is bad, high-interest debts like credit card balances that you should pay quickly.

Financial planner Lauren Anastasio recommends the “debt fireball” method, which prioritises paying off highest interest debts. Once the high-interest debt has been cleared, focus on building your emergency fund so you are less likely to slide back into debt when the unexpected happens.

Once you have accumulated sufficient cash savings, consider making extra payments towards low-interest loans.

Talk to our financial consultants today!

4 – Top up your emergency fund

A robust emergency fund keeps you from debt and gives you time to recover from events like a job loss. If you do not have an emergency fund, starting one should be at the top of your financial spring-cleaning list. Already have one? Top it up if you dipped into it last year.

How much should you save in an emergency fund? Most financial experts suggest saving 3-9 months’ worth of living expenses. Try using the 3-6-9 guidelineiv to figure out how big your emergency fund should be:

  • 3 months of living expenses: if you are living with your parents or are a single adult with no children or dependents, saving 3 months of living expenses is enough
  • 6 months of living expenses: if you have a mortgage and children, aim to save 6 months of living expenses
  • 9 months of living expenses: if you or your spouse are self-employed, freelancing, or work in the gig economy, save 9 months of living expenses to make up for your unpredictable income
Photo by Theme Photos on Unsplash (

5 – Plug your insurance protection gaps

Life insurance

Even as we pray for a long life, we need to prepare a financial safety net for our loved ones in case we pass on.

A study by the Life Insurance Association of Singapore revealed that the average employed Singaporean has a mortality protection gap. If they pass on, their life insurance payout can only meet 80% of their family’s financial needs.

In general, your life insurance payout should have resources of at least 9 times your annual income.


If you fall ill, the last thing you want to worry about is a heavy hospital bill. If you have not done so, consider enhancing your MediShield Life with a hospitalisation plan that covers hospital stays and medical expenses.  

If you have children or are financially supporting your parents, make time to review their health and hospitalisation insurance too. Caring for a sick family member is never easy, so ease that burden and ensure their medical bills will be taken care of.


Accidents can happen to the most cautious person, and some injuries can mean pricey outpatient treatments and loss of income.

A personal accident plan covers medical expenses that arise from accidents, including mobility aids and alternative treatments like Traditional Chinese Medicine. It also gives a cash payout in case the accident results in death, total permanent disability, or partial permanent disability.  

Consider getting one if family members depend on your income, or if you ride a bicycle, motorbike, or travel to unsafe areas.

Talk to our financial consultants today!

6 – Cover your critical illness gap

An emergency fund cannot handle a major illness. Hospital bills often exceed several months’ income, while missing work adds to the financial trauma.

The study by the Life Insurance Association of Singapore also found that the average employed Singaporean adult is severely underinsured for critical illness. If they suffer from cancer, stroke, and similar conditions, their current policies would only meet 20% of their living expenses and lifestyle during recovery. 

Prioritise covering this gap with a critical illness plan. Not to be confused with your health insurance plan, a critical illness plan is a separate insurance policy that gives you a lump sum if you are diagnosed with one of the covered conditions.

Ideally, the payout from a critical illness plan could replace your income and sustain your family’s living standards for 5 years – the amount of time it takes to recover or succumb to a major illness.

A good critical illness plan also should cover various conditions at different stages and continues to protect you even after a payout. Look into Manulife’s Ready CompleteCare, which covers 106 critical illnesses and restarts your coverage up to 900% of your sum insured, even after you have made a claim.

Protection against the financial burden of critical illness.

Photo by Burst from Pexels (

7 – Refresh your retirement fund

When you are juggling with several financial needs, saving for retirement often becomes the last priority. However, all of us will stop working someday. When that happens, we need a solid retirement fund to support our living expenses.

A survey shows that despite mastering personal finance basics, 65% of working Singaporeans are behind on their retirement savings. This means they will not be able to maintain the same lifestyle when they retire.

Ensure an auspicious start to a long life by revisiting your retirement fund. With your desired retirement sum in mind, gather your retirement accounts or investments, and add up the assets you have accumulated so far. Are you on track to meeting your retirement amount?

If you are, keep building your fortune by topping up your accounts every month. If not, determine how much more you need to catch up. Consider cutting down on expenses or using part of your annual bonus to refresh your nest egg.

8 – Call in the experts

Still not sure where to start, or need help deciding what to keep or toss? Like doing a deep clean for the home, tidying up your finances becomes easier with professional help.

As you go through these steps, ask advice from a trusted financial consultant. They clean up people’s finances all year round and can help you close your protection gaps, meet your retirement goals, and revamp your budget.

Ready to start your financial spring cleaning? Tell us what you need – we are here to help.  

Speak to a financial consultant today!


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    Content Sources

    Mothership, (2019, November) 7% GST for Netflix & Spotify coming in 2020.  Retrieved from Mothership

    ii Weliver, D. (2019, July) Budget Well, Save More. Retrieved from Money Under 30.

    iii Martin, A. (2019, October) Suze Orman: Pay Off Debt ASAP. Retrieved from CNBC.

    iv Wong, K. (2016, April) Decide How Big Your Emergency Fund Should Be with the 3-6-9 Guideline. Retrieved from Lifehacker.

    (2018, April) 2017 Protection Gap Study – Singapore. Retrieved from Life Insurance Association Singapore.

    vi (2018, April) 2017 Protection Gap Study – Singapore. Retrieved from Life Insurance Association Singapore.

    vii Ong, L. (2019, July) Most Singaporeans Behind on Retirement Plans, Many Unsure How to Grow Wealth: Study. Retrieved from Today Online.


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