Basic Needs For Singaporeans: How Much Do You Need For Retirement
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How Much Do You Need To Save To Meet Your Basic Needs Upon Retirement?

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How Much Do You Need Per Month For Basic Needs?

Singaporeans who are not planning to settle down, do take note. It is actually more expensive to stay single.

According to Lee Kuan Yew School of Public Policy’s latest finding, here’s how much a household needs to meet their basic needs:

Demographic of householdHow much you need for basic needs
Single elderly household$1,379 per month
Coupled elderly household$2,351 per month
Single person

(aged 55 - 64 years old)
$1,721 per month

source: Lee Kuan Yew School of Public Policy

To break this down even further, here’s a breakdown of where a typical Singaporean elder spends on, every month.

CategoryRetired

(Percentage of monthly expenses)
Single Elderly

(Percentage of monthly expenses)
Elderly as a couple

(Percentage of monthly expenses)
Single before retirement from age 55-64

(Percentage of monthly expenses)
Food and non-alcoholic drinks17%14%20%11%
Food serving services11%15%15%16%
Clothes and shoes2%4%5%4%
Transport8%8%9%12%
Housing and utilities16%18%12%14%
Furnishing, maintenance9%7%4%8%
Healthcare13%6%7%5%
Communication3%2%2%2%
Recreation and culture8%20%19%19%
Others13%7%7%9%

Source: Department of Statistics Singapore (2014)

Fun fact! Elderly couples spend more on food in general.

Going to grandparents' house meme
Source: me.me

 

TL;DR – Are You Saving Enough To Afford Basic Needs Upon Retiring


What Are The Basic Needs?

According to the study that was done, the criteria for basic living:

  • Meals that are healthy and nutritious
  • Household goods based on a two-room HDB apartment such as clothes and personal care items.
  • Basic healthcare needs (assuming good health)

While the above research is optimistic enough to assume an individual having good health, in reality, that is hardly the case. Should our health deteriorate as we age, which is very likely, our basic healthcare cost goes up.

Life Expectancy and Healthy Life Expectancy Of Singaporeans

A Singaporean’s existence on Earth can be broken down into two metrics:

  • His life expectancy
  • His healthy life expectancy

Our life expectancy and healthy life expectancy is different. One can live up to the age of 90 years old (life expectancy) but only manage to stay healthy till 60 (healthy life expectancy). it is 30 years of his life in poorer health. The difference between the two life expectancy and healthy life expectancy is the number of years which medical expenses will increase tremendously.

In Singapore, life expectancy and healthy life expectancy depends on the year which they are born.

 Life Expectancy Healthy Life ExpectancyDifference between Life Expectancy and Healthy Life Expectancy
Years born199020171990201719902017
Males73.581.965.672.67.99.3
Females78.887.668.575.810.311.8
Difference between males and females5.35.72.93.22.42.5

Source: Healthdata.org

Life expectancy and healthy life expectancy at birth in Singapore, both sexes, 1990–2017
Source: Healthdata.org

For those who are born in the year 1990,

  • The Life Expectancy of Males and Females are at 73.5 years old and 78.8 years old respectively.
  • The number of years both genders gets to enjoy good health is till the age of 65.6 years old and 68.5 years old respectively.

Why Women live longer than men

Those who are born in the year 2017 get to live longer on average.

  • The Life Expectancy of Males and Females are at 81.9 years old and 87.6 years old respectively.
  • The number of years both genders get to enjoy good health is at 72.6 years old and 75.8 years old respectively.

This means that healthcare cost for Singaporeans after their Healthy Life Expectancy will be higher.


How Much You Need To Save To Meet Your Retirement Basic Needs?

Ever wondered how much you need to save up, in order to meet your retirement basic needs?

Before we proceed with the calculation, here are some of our assumptions:

  • Assuming zero inflation
  • Assuming good health throughout

Now that we have the Life Expectancy of both Male and Female Singaporeans, we calculate how much they need upon retirement based on the findings of the survey.

Old but still LIT

How Much Should I Save Up If I Wish To Retire At Age 64

Editor’s note: Based on the research, the cost of basic needs for age 62 and age 64 is different. Hence, we use age 64 for simplicity sake.

If a Singaporean is single and stops working only at age 64 (despite our retirement age being 62 years old), here’s the amount required to retire with basic needs.

DemographicBorn in the year 1990Born in the year 2017
Single Elderly (Male) after age 64Single Elderly (Female)
after age 64
Single Elderly (Male) after age 64Single Elderly (Female)
after age 64
Number Of Years9.514.817.923.6
How Much You Need Per Month?$1,379
How Much You Need Per Year?$16,548
How Much You Need In Total?$157,206$244,910.40$296,209.20$390,532.80
  • Depending on the year of which you are born and your gender, your retirement sum needed will range from $157,206 to $390,532.80.

How Much Should I Save Up If I Wish To Retire At Age 55

If a Singaporean who is single chooses to retire at age 55 instead, he will need an additional $206,520.

DemographicBorn in the year 1990Born in the year 2017
Single Elderly (Male) after age 64Single Elderly (Female)
after age 64
Single Elderly (Male) after age 64Single Elderly (Female)
after age 64
Number Of Years9.514.817.923.6
How Much You Need Per Month?$1,379
How Much You Need Per Year?$16,548
How Much You Need In Total to retire at age 64?$157,206$244,910.40$296,209.20$390,532.80
How Much You Need In Total to retire at age 55?$363,726$451,430.40$502,729.20$597,052.80

The Power Of Growing Old As A Couple

To emphasize the power of teamwork, we look at how much one needs to save up as a couple.

For coupled elderly household, the amount per month an individual need drops drastically to $1,175.50 per month.

Using the same demographic and assumption,

  • Retires at age 64
  • Assuming zero inflation
  • Assuming good health
  • Married (Happily married, which led to good health)
  • Assuming the cost of basic needs remains the same even after the wife/husband is no longer around

Here’s how much one will need to meet basic needs upon retirement.

DemographicBorn in the year 1990Born in the year 2017
Married Elderly (Male) after age 64Married Elderly (Female)
after age 64
Married Elderly (Male) after age 64Married Elderly (Female)
after age 64
Number Of Years9.514.817.923.6
How Much You Need Per Month?$1,175.50
How Much You Need Per Year?$14,106
How Much You Need In Total to retire at age 64?$134,007$208,768.8$252,497.40$332,901.60

Dealing With Your Retirement Basic Needs

If the cost above scares the hell out of you, this article has served its purpose.

If I can quote some really chim Chinese Proverb, “The best time to plant a tree was 20 years ago. The second best time is now.” 

So deep

How Much Will I Receive In Monthly CPF Life Payouts?

For most Singaporeans and Permanent Residents, CPF Life payouts can help offset that monthly cost if you meet the Retirement sum.

Retirement Sum
(At Age 55)
Payouts At Age 65Payouts At Age 68Payouts At Age 70
$60,000$540 - $570$640 - $680$710 - $770
$85,500$720 - $770$850 - $910$950 - $1,030
$120,000$960 - $1,030$1,130 - $1,220$1,270 - $1,370
$171,000$1,320 - $1,410$1,550 - $1,680$1,740 - $1,880
$200,000$1,520 - $1,630$1,790 - $1,940$2,010 - $2,170
$256,500$1,910 - $2,060$2,260 - $2,440$2,530 - $2,740

Source: CPF

Depending on the monthly payout, the amount you need to fork out from your own savings account reduces.

Having Good Health Your Entire Life Can Be A Stretch

Your medical cost will increase drastically after your Healthy Life Expectancy. Getting health insurance coverage is one way to “bulletproof” yourself from such an unexpected spike in expenses.

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