According to replies to questions raised in Parliament, the rollover ratio of credit card debt was 15.5% in 2010. The rollover ratio refers to credit card balances outstanding for 30 days or longer as a percentage of total credit card balances.

This is less than the 5-year average of 17% between 2004 and 2008 and below the 20-25% range recorded during the peak period between 1999 and 2003.

In a worrying trend that young people are spending beyond their means, data from Credit Bureau Singapore shows that young adults aged 21-29 represent 39% of new credit cardholders who are frequent revolvers. Little wonder why the banks are targeting these groups of users to sign up for their credit cards.

This group of people also account for a rising share of credit card defaulters, increasing from 9.4% or 123 defaulters in January 2008 to 13.4% or 233 defaulters in November 2010.

The combination of high interest rates charged on credit card balances and the magic of compounding is a sure-fire recipe to financial ruin. Never ever roll over your credit card balances! For those who can afford it, you would be even richer if you had not rolled over your credit card balances.

This Personal Debt Bomb warning sounded by Kuo How Name, President of Credit Counselling Singapore, comes at a good time.

The consumer debt in Singapore has been growing steadily with double digit growth.

A huge component is due to property loans, which now totals $111 billion.

Rollover balances on credit cards has also crossed the $4 billion mark. This is the amount the incurs the hefty 24% pa interest charge.

That is a staggering figure when you consider that there are six million cards issued and the average individual carries 5-6 cards.

Usually, most people will use one or two main cards. Which means to say out of about one million active cards, there’s $4b in rollover balance. This is an average of $4000 per card!

Looks like some high rollers are rolling over their debt.

Rule number one in using a credit card is to pay off the outstanding balance in full every month.

ANZ is currently having a special promotion on their ANZ Platinum credit card.

Applicant who successfully apply for the ANZ Platinum credit card during the period from 17 May 2010 to 31 July 2010 and charge a minimum amount of S$100 in a singe or multiple transactions within one month from the date the Credit Card is approved, shall receive a S$50 cash rebate.

Existing holders of RBS Credit Cards and/or ANZ Credit Cards are not eligible to participate in the Promotion.

Applicants who had cancelled their Credit Cards in the last six months prior to the commencement of the Promotion Period and re-apply will not be entitled to the Cash Rebate.

The ANZ Platinum credit card requires a minimum annual income of S$50k. More details on the card and application can be found here:

ANZ Platinum credit card