Scary Truth About Retirement

How Much Singaporeans Need To Save Now To Retire At 55 Or 62 Years Old

3 min read

The official retirement age in Singapore is 62, and the re-employment age, at 67. This means that your employers cannot ask you to retire before that 62 and re-employment must be offered should you wish to continue working up to the age of 67 within the company. Do note that re-employment is subjected to eligibility.

5 Key Takeaways – The Truth About Retirement

  • Taking the average life expectancy of Singaporeans as a bench mark, most Singaporeans will live till the age of 82.9 years old.
  • On average Singaporeans will have their good health until the age of 73.
  • According to the norm, the average age of retirement in Singapore is 62, and CPF monthly payout comes in at age 65 years old.
  • Most Singaporeans only start planning for retirement at 38 years old.
  • The longer you wait to save up for retirement, the amount you need to save every month increases exponentially.


  • Basic monthly expenses for Singaporeans after retirement is at S$1,200 per month, working out to be $14,400 per year.
  • No inflation for easier illustration.
  • Assuming your investment after retirement allows you to beat inflation every year.
  • We take CPF Monthly Payout out of the equation (we should always aim higher!)
Retirement AgeAverage Life Expectancy Of SingaporeansYears Left To Enjoy RetirementRetirement Savings Required
5082.9 32.9$473,760

The amount of retirement savings reflected in the table is as of the year 2017. It is supposed to increase by the time you retire due to inflation. Apply the formula, using the ” Retirement Savings Required” from the table and number of years to retire from 2017 for the correct savings amount.


Now, allow us to break it down for you.

Scenario 1: How Much Should I Save To Retire By 62?

The average retirement age for Singaporeans is at age 62. Assuming you were to join the norm, here’s how much you need to save each month.

To 62

Here’s how much you need to save each month according to your current age:

  • 25 Years Old – $1,361
  • 30 Years Old – $1,432
  • 35 Years Old – $1,544
  • 40 Years Old – $1,725
  • 45 Years Old – $2,032
  • 50 Years Old – $2,620

Scenario 2: How Much Should I Save To Retire By 55?

If we bring this calculation forward, you should try to have at least this amount of savings now if you wish to retire by 55:

To 55

Here’s how much you need to save each month according to your current age:

  • 25 Years Old – $1,953
  • 30 Years Old – $2,143
  • 35 Years Old – $2,444
  • 40 Years Old – $2,969
  • 45 Years Old – $4,051
  • 50 Years Old – $7,366

How Can One Retire By Age 55?

According to a survey done in the year 2014, 4 in 10 Singaporeans will retire by age 55, but majority knows that they will have to work until at least the age of 60. While there may be doubts when it comes to retiring early, it is not entirely impossible.

For the calculations above, we left out a few factors which can definitely help you retire sooner than expected:

  • We did not include CPF’s monthly payout which can off load your monthly expenses.
  • We did not include the possibility of you having profited from your investments or property (eg. downsizing your house after your children secure their own property)
  • Your bonuses at work which can help you speed up the saving process.
  • For male Singaporeans, your IPPT money can help! 😉

To illustrate how manageable it is to retire by 55, we would like to demonstrate the magic of compounding interest:

Investor A:

  • Age 30
  • No initial savings
  • Annual interest rate/ return on investments of about 2% (eg. the safest SG Savings Bonds)

With 25 years ahead to save up S$642,816, one will have to save up $2,143 each month as shown above. However, simply with 2% of compounding returns from investments each year, one can save up S$666,487 by age 55 with only $1,800 each month.

Investor B:

  • Age 35
  • No initial savings
  • Annual interest rate/ return on investments of about 5% (eg. A diversified researched portfolio of bonds and stocks)

With 20 years ahead to save up S$586,570, one will need to set aside $2,444 each month. With an annual return of 5% on investments, he only needs $1,500 each month to obtain S$624,946 in 20 years, exceeding his target.

Given that the median wage is at S$3,500, retiring by age 55 definitely seems possible as long as one has the discipline to save and knowledge to invest.

The scarier truth – Health.

Now, here’s the scarier truth. While most Singaporeans assume that they can enjoy life after retirement, they did not take into account the condition of their health. The average number of years for Singaporeans in good health is 73.65 years old and assuming one will not be enjoying retirement to the fullest without his good health, we revisit the number of years to enjoy retirement.

Retirement AgeAverage Number Of Years in Good HealthYears To REALLY Enjoy Retirement

This further emphasises the need to retire earlier as much as possible. By aiming for retirement at age 55, one will get to enjoy at least 18 years before his health starts deteriorating.

As the saying goes, “The best time to plant a tree was 20 years ago. The second best time is now.” Have you started planning for your retirement?

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