When do you think you can retire? Here's what Singaporeans think

The Covid-19 situation has caused a major upheaval in many areas of our lives.

Some of the common areas include:

• Learning to embrace remote working as a new norm, working from home or even from hotels
• Discovering and relating to the word ‘languishing‘ – a sense of restlessness and stagnation
• Reevaluating priorities in life, such as work and purpose

The pandemic has seemingly placed a huge reset button in all our lives, causing us to rethink life’s big questions and question our priorities.

It is therefore not surprising when a study conducted by Fullerton Fund Management showed how Covid-19 has reshaped Singaporeans’ attitudes towards retirement .

This study looked into Singaporeans’ views towards retirement, and it surveyed 1,000 Singaporeans who were aged 21 and above, with minimum monthly incomes of $3,000 and owned some form of investment.

Some key findings by the study include attitude shifts towards the idea of retirement, and the expectations of top retirement income sources.

Let’s take a look!

TL;DR: Singaporeans’ views on retirement: Age to start retirement planning, top retirement income sources, expected retirement age, and more

When do Singaporeans start planning for retirement?

With many financial goals ahead of us, retirement planning is usually not on the top of the list when it comes to financial planning.

Individuals usually put off planning for retirement till an age close to retirement, due to saving for more immediate financial milestones such as wedding , housing , and children’s education needs.

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This study revealed that on average, 81 per cent have started financial planning, but only 69 per cent have started retirement planning.

A healthy 83 per cent of individuals aged 21 to 30 have begun financial planning, but only slightly above half have started planning for their retirement.

According to the study, there are different perceived barriers to retirement planning.

For those aged between 21 to 30 years old, individuals feel that they lack the monetary capital to do so.

For those aged between 31 to 50 years old, individuals feel that it is an additional commitment (on top of other financial commitments).

For those above 50 years old, most think that it is too late to start.

Age that Singaporeans think they can retire at

With Singaporeans starting retirement planning later, there are also gaps between the desired retirement age and the age individuals think they can retire.

Age Group	Desired Retirement Age	Age You Think You Can Retire
21 to 30	57	61
31 to 40	60	62
41 to 50	62	64
51 to 60	64	65
61+	70	70

Singaporeans generally feel that they can only realistically retire past their desired retirement age.

This is no surprise given how retiring early in Singapore may seem like a pipe dream .

As the desired retirement age gradually increases across the age groups, it also shows that the younger generation is slightly more optimistic in earlier retirement.

How much Singaporeans think they need for retirement

Most Singaporeans are worried about not having enough money for retirement.

Given the cost of living in Singapore and the increase in life expectancy, Singaporeans are mostly not confident of having sufficient retirement funds.

On average, Singaporeans are estimating that they require an average of $1.4million for the desired retirement lifestyle.

Age Group	Estimated Retirement Sum Required for Desired Retirement ($)
21 to 30	$1.5 million
31 to 40	$1.8 million
41 to 50	$1.6 million
51 to 60	$1.2 million
Above 60	$1.1 million

Only 38 per cent of the respondents are confident that they are able to achieve this sum, which is quite a worrying statistic.

And this can also be seen as a result of delayed retirement planning.

Top Singaporean retirement income sources

Age Group
Top Retirement Income Sources	Total Average	21 to 30	31 to 40	41 to 50	51 to 60	Above 60
CPF	52 per cent	45 per cent	35 per cent	53 per cent	68 per cent	62 per cent
Investment Returns	48 per cent	53 per cent	53 per cent	48 per cent	39 per cent	46 per cent
Savings	31 per cent	33 per cent	22 per cent	26 per cent	34 per cent	42 per cent
Endowment Plan / Retirement Insurance	31 per cent	23 per cent	29 per cent	33 per cent	38 per cent	30 per cent
Income from Property Rental	22 per cent	20 per cent	31 per cent	18 per cent	20 per cent	19 per cent
Supplementary Retirement Scheme (SRS)	21 per cent	19 per cent	22 per cent	21 per cent	38 per cent	18 per cent
Working Through Retirement	20 per cent	20 per cent	20 per cent	19 per cent	22 per cent	21 per cent

Note: Figures do not add up to 100 per cent as respondents are able to choose more than one option

Unsurprisingly, CPF tops the list as the top retirement income source, given how CPF LIFE is an inevitable portion for Singaporeans.

However, this study also revealed that many Singaporeans now do expect their investment returns to help fund their retirement.

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More than half of the respondents (53 per cent) from ages 21 to 40 are looking to get their retirement income from their investment returns, as compared to 68 per cent of those aged 51 to 60 who cited CPF as their main retirement income source.

This shows that younger Singaporeans are now reducing their reliance on CPF, and are looking for other ways to diversify their retirement income sources, which includes taking on more risks to generate long-term returns.

Respondents between 21 to 30 years old also have a stronger preference for capital appreciation for their investments, while those aged 31 to 40 years old prefer to have a fixed monthly income.

Which is expected given the longer time horizon the younger ones have to enjoy the power of compounding .

Retiring early in Singapore: A possibility or just a dream?

This study has provided us some interesting insights into how Singaporeans view retirement.

Retirement is no longer seen as the end of a journey, but more of a new start to pursue life goals and have a renewed purpose.

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However, given that most Singaporeans do not prioritise retirement planning, a lot of us are unprepared for the actual retirement, especially given the amount that is required to fund our golden years.

This can be seen as one in five Singaporeans are expecting themselves to work through retirement.

Which is something that can definitely be avoidable if adequate planning is done while we still can afford to do so.

Now that we know that a huge sum of money is required for us to achieve our desired retirement lifestyle, the more we should start looking at it earlier to be better prepared for our future.

And your future self will thank you for any small steps that you start taking today.