With effect from 31 October 2023, the Business I-Banking service will be terminated and will be replaced by our new Baiduri b.Digital Business service. To help you with your transition, email us at [email protected].
5 tips to avoid getting deep in debt
Managing debt is an important part of maintaining your financial health.
Amal is three years into her first job after graduating. While she still lives with her parents, she puts a lot of effort into keeping up with appearances. She drinks oat milk latte from her favourite cafe and only buys clothes and accessories from designer brands.

Wafiy and his wife both have stable jobs in the public sector, and they have two kids who attend private schools. They also spare no expense in dressing the kids well and ensuring their kids have everything they need. They’re still paying off the mortgage on their first home, and Wafiy is thinking of trading in his current car for the latest luxury car model in Brunei.

To Amal and Wafiy, their spending and lifestyle habits are signs that they have arrived – they’re doing well and have reached a certain financial status. This may be true on the surface. However, in the long run, they’re probably not spending within their means to try and keep up with their current lifestyles.

This is the biggest mistake many people make: they forget the fundamentals of saving and budgeting and find themselves in the depths of debt.

Some rack up credit card debt, while others end up taking loans from “online loan sharks” or lending agencies which are not licensed by the authorities. The Brunei Darussalam Central Bank (BDCB) website has an alert list with information of companies and websites which are not approved by the central bank.

If debt accumulates and becomes overwhelming, the negative impact goes beyond your financial health. The stress and anxiety over repaying that debt impacts your mental, physical and social well-being as well. This can manifest itself in sleepless nights or ailments like headaches, fatigue and trouble breathing.

The number one rule is not to spend more money than you earn and avoid being in debt altogether. However, if there is a genuine need, incurring debt is not a problem so long as you can manage it responsibly and make regular payments.

Managing debt is an important part of maintaining your financial health. Positive thinking, unfortunately, isn’t enough to work a debt situation out. Here are five tips to ensure that you’re financially prepared:
1. Track your expenses and develop a budget
This is starting point of every financial journey. It is essential to track your expenses and monitor how much you’re earning and spending. From there, you will be able to assess whether these are necessities or nice-to-haves. Becoming more aware of your income and expenses can help you to eliminate or reduce unnecessary costs.

Once you have established this, work out how much you can save every month, how much to allocate to your necessities and having an emergency fund for those “just-in-case” situations. Establishing a fallback fund creates a financial buffer to cover any unexpected circumstances like losing your job or a serious injury.

2. Prioritise your debt

There’s no shame in admitting that you’ve spiralled into debt. The important thing is that you’ve recognised it and you’re working to improve the situation. It’s worth watching how rising interest rates in the US will impact the region’s recovery efforts, with central banks in Asia potentially following that lead. With the prospects of an uncertain economy, focus first on paying off high-interest debts and pay it off in full or in parts until it’s paid off.

3. Don't take on more debt
While you’re in debt reduction mode, it is important to work towards paying off what you currently owe before taking on any new debt. A good rule of thumb is if you can’t pay for something in cash, don’t buy it! If you’re still using your credit card to pay for purchases to earn rewards, make sure you pay off your balances promptly.

4. Consider consolidation
If you’re deep in debt, look into consolidating them into a single, lower interest rate loan. This can help you make your monthly repayments and outstanding balances more easily, and potentially save you money. At the same time, make it a habit to track your spending and be on top of your outstanding debts.

5. Stay disciplined

Sticking to your debt management plan requires determination and discipline. If it means avoiding the shopping mall or hanging out with your friends for a period, do what is necessary. It might even mean staying off Instagram or TikTok, as social media FOMO is probably contributing to your desire to splurge on a purchase or an experience, so you have something to share on your feed. However, stay the course by sticking to your budget, making regular payments, and avoid taking on new debt if possible.

The stresses of today do require a certain degree of self-care, and it may be tempting to purchase a little something special to treat yourself, indulge in gourmet dining experiences or taking a beach holiday for some rest and relaxation. However, be honest about your spending and make sure you stick to the rule of not spending more than you earn. Budgeting and staying disciplined is crucial to maintaining your financial health.

Working out your debt can be a stressful affair. If you have more questions on managing debt and maintaining your financial health, book a consultation with our financial planners.
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Important update
19 September 2023

We would like to inform you that with effect from 31 October 2023, Business i-Banking service will no longer be operational, and this will be replaced with our new Baiduri b.Digital Business service.

If your company has not transitioned to b.Digital Business, please ensure that every existing user provides the following by 8 October 2023 through the Business i-Banking Inbox:
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Alternatively, you can complete the b.Digital Business Amendment Form and submit the form(s) directly to Baiduri Digital Hub, Ground Level, Baiduri Bank Headquarters.

Every user will receive a notification email at their registered email address, once they have been migrated and activated on the b.Digital Business service.

Companies who have not moved to b.Digital Business after 31 October 2023 can re-apply as a new subscriber to the b.Digital Business service. This will require additional documentations to be submitted as part of the application. Refer “Required Documents” here.

Important notice: Our Business i-Banking service will be deactivated soon. To ensure continued access and a smooth transition to the new Baiduri b.Digital Business, please provide your full name, IC, email address and mobile number via Business i-Banking Inbox. If we do not receive updated details from all authorised users, your company will not be migrated to the new platform and a fresh application will be required. For assistance, contact us at [email protected] or call 2268 637/8/9 during business hours. Thank you for your cooperation.

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