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A Debt Problem leading to Divorce

Julia is a 34-year-old Senior Manager. She earns an income of $132,000 a year and owed a total of $321,500 to a few financial institutions. The main causes of indebtedness were due to overspending and expenses due to divorce.

The interview:

CCS     : How did using credit cards got you into a problem with debt?
Julia: I was using credit cards for many overseas business trips. However, when my employer reimbursed me the full sum, I only repaid the minimum amount. I had used the “extra” to spend on other things.

Later, when I started my family, my spending increased. I renovated my house and bought a car. I also relied on my credit cards to pay for necessities such as food.


CCS     : What lead to the breakdown of your marriage?
Julia : I think that the financial stress partly caused some discord in my marriage, which eventually led to a divorce. It was not an amicable separation.

I incurred a substantial sum of money to fight my case in Court, move out of the matrimonial home, and employed a domestic helper as I had full custody of my child.


CCS     : Did you share your debt problem with anyone?
Julia: No, of course not. Because I felt that my situation was embarrassing! However, I think my mother was partially aware of my money problems when I asked to borrow some money from her.


CCS     : Who prompted you to seek assistance from CCS?
Julia: I had read about CCS in the newspaper. One of the bank officers also referred me to seek help from CCS.

However, I did not go through the Debt Management Program (DMP) the first time I approached CCS. This was because I could not make the necessary lifestyle adjustment without affecting my ex-spouse. For example, I did not dispose the car to reduce expenses as suggested my counsellor as we wanted to continue using it.

Several years after my divorce, I approached CCS again. This time, I forced myself to make lifestyle changes and managed to work out a debt repayment arrangement.


CCS     : Were there trying moments that made you feel like giving up? If yes, how did you manage to overcome the situation?
Julia: It was tough initially as money was tight. I even had to borrow from licensed moneylenders because I could not keep up with the monthly instalment payments as my income, which was commissioned-based, was fluctuating.

I also attended a Meet-the-People session and sought assistance from my Member of Parliament to appeal for IRAS to allow me a longer period when paying my income tax in instalments.

During this period, I forced myself to stay flexible, learnt new skills and knowledge to enhance my employability. Eventually, my persistence paid off and I managed to increase my income by about 20% with each new job that I applied for. This helped me to cope.


CCS     : Please share some words of advice to people who may be facing a debt problem.
Julia: I’m happy to share that I will complete my DMP in a few months’ time.

This journey had been a painful experience. But I have learnt valuable skills in managing my money. In fact, I plan to save the money in a fixed deposit account.

Don’t give up, seek help by talking to your bank and CCS. Persevere through when you are on DMP, even though it is hard to do at the beginning.

There is always light at the end of the tunnel!

If you are facing strains in your marriage, considering divorce, or beginning divorce proceedings, things can feel very overwhelming. Explore the information, resources and tips available online at MSF Family Assist to help you make decisions, strengthen your marriage, manage the divorce proceedings, and mitigate the impact of divorce.

An interview with a CCS Client – This is the seventh of a series of interviews conducted with Credit Counselling Singapore’s (CCS) counselled clients on our Debt Management Programme. 

Profile of the client is presented based at the time the person approached CCS for assistance, which could be as recent as a few months ago or several years ago.  Name of the interviewed client has been changed. 

These interviews will be published on the 3rd Friday of the month.

Credit Counselling Singapore

Published 20 January 2023.