How Poor Are Singaporeans? Monthly Household Income vs Household Expenditure
 
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How Poor Are Singaporeans? Monthly Household Income vs Household Expenditure

Ming Feng
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Do you know where you stand among fellow Singaporeans in terms of household income?

Now, go on and sum up the income of all the income earners in your household, does it give you more than $9,293 per month?

If it does, congratulations, you are better off than 50% of Singaporean household! But, have you ever compared your income to Singapore’s cost of living?

Key Takeaways:

monthly income vs monthly expenditure in Singapore

  • At least 20% of Singaporeans are earning less than their monthly expenditure
  • Singaporean’s households spend an average of $4,910 per month in 2017/18
  • Two ways to do better for household finances: Pegging your expenses in the various category to Singaporean’s household average, and finding the right investment.

Further Reading: Singaporean’s household spending

  • Household expenditure of Singaporeans differs with age, with the age range of 30-39 years old spending the most.
  • Based on the Household Expenditure Survey done in the year 2017/18, Singaporeans spend an average of $4,906 per month. Back in the year 2012/13, the household expenditure per household is at $4,724.
  • The average expenditure per household member is at $1,628 per month.
  • That includes day-to-day expenses on items such as food, bus/MRT fares and clothing. Regular expenditure such as utilities, phone bills and school fees, as well as items such as holidays and hospitalisation bills are included too.

What Are Singaporeans Spending On Every Month?

Here’s a breakdown on what Singaporean households are spending on every month:

Types Of ExpensesAmount SpentExamples Of ExpensesAmount On Each Type Of Goods And Services
Food$1,199Hawker Centres, Food Courts, Coffee Shops$437
Food, Non-alcoholic Beverages$389
Restaurants, Cafes and Pubs$296
Transport$781Private Road Transport$507
Public Road Transport$175
Passenger Transport By Air$96
Housing Related$708Housing And Utilities$426
Furnishing And Household Maintanence$282
Recreation And Culture$379Holiday Package$176
Information Processing Equipment$31
Newspaper, Books And Stationary$18
Educational Services$339University Education$120
Private Tuition And Other Educational Courses$112
Health$323Outpatient Services$172
Communication$240Telecommunication Services$222
Telecommunication Equipment$18
Clothing And Footwear$123Clothing$87
Footwear$26
Accommodation Services$70Overseas Hotel$65
Others$744Insurance$371
Personal Care$130

Source: Singstat.gov.sg

Average Monthly Household Expenditure By Income Quintile

If you are wondering how much are each income quintile of Singaporeans

Income QuintileAverage Monthly Household Expenditure
1st - 20th$2,570
21st - 40th$3,753
41st - 60th$4,812
61st - 80th$5,826
81st - 100th$7,573

Source: Singstat.gov.sg

Average Monthly Household Income By Income Quintile

Now that we know the monthly household expenditure, we look at the average monthly household income by income quintile.

Do note that household income includes employer CPF contributions per household member.

Income QuintileAverage Monthly Household Income
1st - 20th$2,235
21st - 40th$5,981
41st - 60th$9,678
61st - 80th$14,407
81st - 100th$26,587

Source: Singstat.gov.sg


The Scary Truth: At Least 20% Of Singaporeans Are Earning Less Than Their Monthly Expenditure

Statistically, median household income after CPF contribution exceeds monthly household spending.

It may appear that Singaporeans are doing well until we break down the information even further.

Comparison Between Average Monthly Income To Monthly Household Expenditure

Income QuintileAverage Monthly Household IncomeAverage Monthly Household ExpenditureDifference
1st - 20th$2,235$2,570-$335
21st - 40th$5,981$3,753$2,228
41st - 60th$9,678$4,812$4,866
61st - 80th$14,407$5,826$8,581
81st - 100th$26,587$7,573$19,014
  • The lower 20% earners in Singapore’s income is less than their monthly expenditure. Every month, they are exceeding their monthly income by $335.
  • Should they have no way of covering back this additional $335 expenses incurred, they get trapped in a cycle of debt.
  • The difference in monthly household expenditure between the top 20% earners and the bottom 20% in Singapore is about $5,003.
  • For the higher income, their monthly expenditure is not even one-third of their monthly household income, which means they will only get richer with each passing month.

The lower 20% earning household in Singapore, on the other hand, face a high chance of getting stuck in this cycle with no extra cash to pull themselves out of the poverty cycle. Their never-ending cycle with debt will only add on to their financial burden each money.

This is how real Singapore’s poverty situation can get for the lower income.

Sad

As for Singaporeans households that are on the 21st – 40th quintile and above, their income sits on a very comfortable level.

  • 21st – 40th quintile: Income exceeds expenditure by $2,228
  • 41st – 60th quintile: Income exceeds expenditure by $4,866
  • 61st – 80th quintile: Income exceeds expenditure by $8,581
  • Above 80th quintile: Income exceeds expenditure by $19,014

This further enhances the point that the rich will only get richer.


We Can Do Better
Source: giphy

How we can do better – breaking that usual cycle?

  • If you find your household spending more than the average, maybe it’s time to watch your expenses.
  • Two ways Singaporean are stretching their household expenditure: spending on necessary item (expenditure fats) and spending on a wrong investment product

Breaking down our expenses: In search of household expenditure fats

The most immediate way to getting better with our household expenditure is to get rid of our expenditure fats. Below is a quick overview of average monthly household expenditure according to age range.

 <30 years old30-39 years old40-49 years old50-59 years old>60 years old
Housing related expenses$830$888$761$595$552
Food$997$1,235$1,245$1,280$1,019
Transport$573$988$990$805$538
Recreation$398$449$443$407$307
Educational Services$166$279$456$383$117
Health$212$271$233$268$284
Communication$191$232$243$237$159
Clothes & Foorwear$140$194$175$164$103
Others (eg. Cigarettes, beer, manicure)$513$824$808$698$505

If we translate the above information into bar charts, we noticed that the 3 main categories Singaporeans of all ages spend on are:

  • Housing
  • Food
  • Transport

Other than health, education and housing which might be subjective, one can take a look at the rest of his expenditure in terms of category every month to find out which area is he spending too much on.

Two ways to track your expenses effectively:

  • An expense tracking app like Seedly (it’s free to use!)

Seedly App Expense Tracker

  • A detailed excel sheet
I Think They Get It
Source: giphy

“Yea. Seedly is that free expense tracking app you can download.”

Getting The Right Investment Product

Your paycheque and savings account can only get you so far.

Choosing the right investment product should always be at the back of your mind.

It’s not uncommon for people to be sold investment-linked products by their insurance agents even if they don’t fully understand or know that they can keep the protection and investment elements apart.

In fact, some of these people might be better off investing in other financial products like the Singapore Savings Bond (SSB) if they are properly educated!

Follow our Seedly communities, be active, and win a 3D2N All-Expense-Paid Trip to Bali for 2!

About Ming Feng
A stint in Bloomberg gifted me with a beer belly, which only grew larger when I moved on to become a Professional Trader. Now I turn caffeine into digestible finance-related content.
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