You will be shocked to know how much do we need to retire in Singapore
You will be shocked to know how much do we need to retire in Singapore
To know how much do we need to retire in Singapore can be quite shocking. Singapore retains its title as the world’s most expensive city for a fourth consecutive year in a top ten that may have a familiar feel to it. According to the source: Worldwide Cost of Living Report 2017. In the report, Asian countries now account for half of the ten most expensive cities ranked with Hong Kong remains second and Tokyo together with Osaka.
Being a “kiasu” Singaporean would ask a common question when it comes to retirement planning in Singapore ” Then how much we need to retire in Singapore?” especially we are the living the most expensive city in the World.
In this section, we list out content that can help you know more about retirement planning
- How retirement blueprint helps one of my clients retire 5 years earlier than expected
- How to plan for retirement in Singapore ( 3 things you can’t do without)
- Retirement Planning: Tips On Making Full Use Of Your CPF
- Smart Retirement Planning Tips
- Retirement Planning Singapore: CPF LIFE (3 Things To Know)
Assuming that we are taking at $1500/month during our retirement from age 65 and the life expectancy till 90. We will need a total amount of
$1500/mth x 12 months x 25 years = $450,000
This making the assumption that the house is fully paid by the time we retired at age 65, not taking inflation into consideration to make things simple and of course the medical cost in the latter years of our life.
We are talking about cold hard savings here as most of the average Singaporean uses the CPF to finance their house. Hence the chances of meeting the full retirement sum scheme of the Retirement account will become alot harder base on the average income earner in Singapore.
Additionally, we are only focusing on maintaining an average lifestyle of $1500/mth, which includes public transport (no grab!), and pretty mundane food which mainly are homecooked and some basic entertainment expenses.
We can further break down on how to save up the amount. $450,000.
Assuming that the average Singaporean starts to save up for their retirement from age 40 till age 65, he will need to set aside $1500/mth for this period of time.
The question is ” How many of us, Singaporeans, have this kind of money saved up?” with our bills, expenses increasing and worst till you have kids. Sending kids to school, childcare or tuition these days are not cheap as we always want the best possible for our kids. With all these in mind, it will close to impossible to set aside this amount of money every month.
One way is through growing the money that you saved so you require to save lesser and growing their retirement pot.
The topic of how to plan for retirement in Singapore can be frightening. For Everyone, we only have one chance to get it right.
Yet, it is certain that one day, we will have to retire – either by choice or in some cases, by a lack of choices. It’s not something that will go away just because we don’t think about it.
Finally, the actual planning requires many assumptions and those assumptions can change through time so we need look through them to ensure that your retirement blueprint is on track.
