Siti, 31, is an HR executive who earns $4,500 a month and takes home $3,600 after CPF. In March her credit card bill came to about $1,800 more than usual, and it took her a day to trace the charge to the annual premium on a life policy she bought three years ago. She decided to list every payment that leaves her accounts on a schedule.
Recurring payments in Singapore households range from phone plans and streaming services to gym memberships and insurance premiums. Most are set up once and then charged automatically to a card or by GIRO. They are found by reading statements for merchants that charge on a regular schedule, and an annual renewal needs twelve months of statements to show up.
Siti found seven monthly charges costing $200 a month and three annual charges costing $2,049 a year. Together they come to $4,449 a year, or about $371 a month. That is about a tenth of her take-home pay.
How Does She Recognise A Recurring Payment?
A merchant is a monthly repeat when it charges in at least three of the last twelve months, once in each month, and either:
- the gaps between charges are between 25 and 36 days, or
- the charges fall within four days of the same date each month.
A charge whose amount changes, such as a utility bill, still counts. The monthly figure is then an estimate, such as the average of the last six bills.
Annual charges need the full twelve months. A three-month review would have missed Siti's life premium entirely, because it fell due in a single month.
What Did Twelve Months Of Statements Show?
Siti read twelve months of her bank and card statements. She found these recurring charges:
| Charge | How often | Amount | A year |
|---|---|---|---|
| Mobile plan | Monthly | $30 | $360 |
| Gym membership | Monthly | $120 | $1,440 |
| Video streaming | Monthly | $18 | $216 |
| Music streaming | Monthly | $12 | $144 |
| Free trial that became paid | Monthly | $9 | $108 |
| Phone app | Monthly | $7 | $84 |
| Cloud storage | Monthly | $4 | $48 |
| Life insurance premium | Annual | $1,800 | $1,800 |
| Annual travel insurance | Annual | $150 | $150 |
| Software licence | Annual | $99 | $99 |
| Total | $4,449 |
Source: Worked example
The monthly charges total $200, or $200 × 12 = $2,400 a year. The annual charges add $2,049. Two of the monthly charges, the lapsed free trial and the phone app, were ones Siti no longer used, at $16 a month or $192 a year.
Read Also: How To Budget In Singapore: Building A Monthly Budget From Your Bank Statements
Where Did Her Recurring Charges Hide?
Some recurring charges are harder to spot on a statement:
- App store billing, where several subscriptions bought through a phone's app store appear under the app store's name and the service's name is missing.
- Foreign currency charges, where a service billed in US dollars changes in Singapore dollars each month with the exchange rate, so the amount never repeats exactly.
- Charges on a second card, where a subscription moved to a new card when the old one expired appears on a different statement.
- Annual renewals, where insurance, software and memberships renewed once a year sit in one month's statement only.
Siti's two unused charges were both billed through her phone's app store, under the store's name. That is why neither had stood out in a monthly glance at her card bill.
How Do Recurring Payments Affect Her Credit Card?
A recurring bill charged to a credit card, including a telco or utility bill paid by GIRO, is a merchant charge. It counts towards the card's spending, and some cards pay a bonus on it.
An annual premium charged to a card can lift one month's total well above the rest. Siti's $1,800 premium may clear a minimum spend or hit a monthly cap in March that the other months do not, so a card comparison has to replay it in the month it fell due.
Read Also: Which Credit Card Pays The Most In Singapore? Why The Answer Comes From Your Own Monthly Spending
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Which Households Should Review Their Recurring Payments?
Siti cancels the lapsed trial and the phone app and saves $16 a month. Her recurring payments fall from $4,449 to $4,257 a year, and she notes March as the month her life premium is due.
A yearly review suits every household that pays by card or GIRO, since charges continue until they are cancelled. Households with several cards gain the most, because their recurring charges are spread across more statements. Twelve months of statements is the minimum for a full list, because annual renewals appear only once in that period.