Nearly two-thirds (63%) of Singaporeans view saving for retirement as their number one personal finance goal, more than anywhere else in the region (49% on average).
Besides retirement saving, shoring up emergency funds (44%), maintaining their current lifestyle (34%) and saving for medical needs (26%) are their other priorities.
For younger Singaporeans without children, however, saving to buy a home is a priority (46%), well above the country’s average (21%).
According to the Manulife Asia Care Survey 2023, Singaporeans’ concerns about the impact of inflation (68%) on their saving goals are above the regional average (64%). Other worries include the risks of economic slowdown (57%) and rising healthcare costs (53%).
Manulife says rising healthcare costs are a “major concern” in Singapore. “53% of the respondents believe healthcare costs pose a risk to their financial goals, more than 10 percentage points higher than the region (42%). In addition, the respondents also do not think of themselves as being in particularly good physical and mental health. Only about one in 10 considers themselves to be in good physical and mental health,” says the insurer and wealth manager in a March 29 press release.
Manulife’s survey was conducted in December 2022 and January 2023 in seven Asian markets: mainland China, Hong Kong, Indonesia, Malaysia, Philippines, Singapore and Vietnam. Of the 7,224 people aged 25 to 60 years old surveyed via an online questionnaire, 1,037 were from Singapore.
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The respondents were composed of insurance owners and individuals who did not have insurance but had the intention to purchase insurance over the next 12 to 24 months.
Singapore respondents’ hopes of saving for retirement are stifled by more immediate financial and lifestyle pressures, says Manulife.
Despite retirement saving being their top personal finance goal, only 35% have a retirement plan in place, ranging from a quarter of those aged 25 to 35, to 44% of those aged 45 and above. Furthermore, only 26% of respondents have set aside funds for retirement.
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“Most of the respondents in Singapore recognise the importance of saving for retirement, but their other financial needs can get in the way, reflecting the priorities they have to juggle. But it’s a worry that so few have a retirement plan,” says Khoo Kah Siang, chief executive officer of Manulife Singapore. “Retirement planning must start early so that you have a longer runway to grow your retirement funds. While there are many urgencies in life, it is important to prioritise retirement planning so that you are able to enjoy your golden years, when it comes.”
In Singapore, cash and bank accounts (63%) remain the primary way to save for retirement, well above the regional average (53%).
Savings or endowment insurance along with returns and recurring income from non-fund investments (both 20%) are a distant joint-second to cash.
“As we’ve all seen over the past 12 months, inflation is a risk and cannot be ignored,” says Khoo. “The overreliance on cash as a savings tool in Singapore exposes Singapore consumers to inflation risk — inflation eats away at the value of cash savings. So, it’s important to find avenues that offer compounding returns.”