SINGAPORE: It's not just the young — divorcees, too, are not paying their credit card bills on time.

In the latest statistics released by the Credit Bureau of Singapore (CBS) on Thursday, 1.98 percent of divorced people — compared to 1.37 percent of singles — had an account that was at least 30 days overdue.

Divorcees and those separated from their spouses are also more likely not to pay their credit card balances in full.

"The analysis on divorced and separated consumers clearly reflects the cashflow strain a marital split can have on an individual's financial position," said CBS general manager Mark Rowley.

Said Mr Vincent Ee, managing director of financial planning services firm Financial Alliance: "I guess when people are undergoing that kind of family stress, their attention is not on managing finances. Paying the credit card bills becomes the last thing on their mind."

And moving from a double-income lifestyle to a single-income one adds to the financial strain, Mr Ee noted. For example, a couple who used to share a car would each now have to pay for the expense of a vehicle individually, he said.

Divorcee Isabel Chew, 31, suggested that one might spend more on improving his or her self-image through top-to-toe grooming sessions after a split. "I also think men are more likely to keep on spending carelessly after a divorce because there is now no woman to keep them in check," she said.

Indeed, the CBS' latest findings show that men are more likely to have a higher average overdue balance, miss payments and revolve their balances compared to women.

In March, the average overdue balance of men was S$216 — more than double that of women at S$91, the CBS data showed. And 39.15 percent of men revolve their credit, as compared to 35.5 percent of women, according to the data.

While the CBS does not have information on why divorced people are spending more and what they are spending on, this group is hardly the clientele of financial counsellors.

At Credit Counselling Singapore (CCS), which helps individuals recover from serious debt problems, the average client is 40 years old, with 70 percent of them married with children. He takes home on average S$2,600 per month and stays in a five-room flat.

The other group that CCS is concerned about is made up of young adults aged 30 years and below. In 2006, this group constituted just 9 percent of 733 counselled clients. Last year, they made up 13.4 percent of 685 clients and in the first quarter of this year, they accounted for 14.7 percent of the 150 seeking financial counselling.

The CBS also singled out young adults as a concern, noting that 1.38 percent of those aged 21 to 29 years have an account that was at least 30 days overdue. A third or 33.56 percent of them also revolve their credit — an increase from the 32.57 percent last year.

"Young adults are faced with the euphoria of earning their own income and tend to underestimate the income required for a certain lifestyle," said CCS assistant director Tan Huey Min.

"When targeted by the aggressive marketing of the credit card companies and the easy access to credit facilities, they spend frivolously, which could lead them into financial problems."


- TODAY/so