The Real Singapore
Oct 23, 2013
In my preparation to speak at a seminar on Retirement and Healthcare Concerns, organised by the Singapore Professional Centre on 26 October, 2 to 5 pm (registration link is here), and the SPP Financial Literacy Awareness programme (7th Intake) on 9 November, 3 to 6 pm (registration link is here), I came across the following:
The Future of Retirement study
I refer to The Future of Retirement study on global retirement trends published by HSBC.
61% not prepared for retirement?
According the its latest report, Life after work? – 2013, Singapore report, only 8% of respondents answered Yes, I am preparing more than adequately (for retirement), and 31% answered Yes, I am preparing about adequately.
12, 44 and 5% said No, I am not preparing at all, I am not preparing adequately, and D’ont know, respectively.
So, does it mean that about 61% are not adequately prepared?
51% can’t save?
“Of those not saving for retirement, nearly half (47%) say they cannot save for retirement due to the high cost of day-to-day living. This figure rises to 51% for the 35-44 year olds.
HDB eating up CPF and cash?
When asked what are some of the events that can derail people’s efforts to save for retirement, the most important is the cost of buying a house” (“61% of S’poreans fear not having enough money to retire”, TR Emeritus, Sep 19).
MOM commissioned study?
The above seems to fly in the face of the recent MOM commissioned study at a local university – which concluded that S’poreans are expected to be more adequately prepared to retire than the average of the OECD countries?
Root cause?
What is the root cause of Singaporeans’ poor retirement preparedness?
Well, arguably, it may be due to the Government not spending a single cent on healthcare, CPF and HDB. Please watch this video and read this article explaining this.
CPF’s low interest?
I estimate that only about 1 in 8 Singaporeans who reach age 55 were able to meet the CPF Minimum Sum (currently $148,000) entirely with cash from their CPF accounts.
The fundamental cause of this may be that not only does the Government not spend a single cent on our CPF system – it uses our CPF which is our own money – and pay us what is probably the lowest interest of as low as 2.5 per cent on the bulk of our CPF savings.
High HDB prices?
The other major reason may be that it does not spend a single cent on our HDB – but makes profits from high flat prices which takes away much of our CPF and cash in our lifetime.
Healthcare costs?
Also, by not spending a single cent on healthcare – an estimated $7 billion of Singaporeans’ cash flows go towards paying for private healthcare spending in a year, which is a whopping estimated 67 per cent of total healthcare expenditure, with public healthcare spending accounting for the balance of only about 33 per cent.
Leong Sze Hian
*Leong is the Past President of the Society of Financial Service Professionals, an alumnus of Harvard University, has authored 4 books, quoted over 1500 times in the media , has been host of a money radio show, a daily newspaper column, Wharton Fellow, SEACeM Fellow, acting managing editor and columnist for theonlinecitizen, columnist for Malaysiakini, a Member on the CIFA International Advisory Board, executive producer of the movie Ilo Ilo (8 international awards), treasurer of Maruah, and invited to speak more than 100 times in more than 25 countries on 5 continents. He has served as Honorary Consul of Jamaica and founding advisor to the Financial Planning Associations of Brunei and Indonesia. He has 3 Masters, 2 Bachelors degrees and 13 professional qualifications.
P.S. Update: $7,001
$3,754 to go
Thank you Singapore
Han Hui Hui has lost her life savings of $10,755.
If only 10,755 Singaporeans who care – donate $1 each to this brave 33 kg 21 year old.
Send your $1 vide Internet Banking, ATM or cheque to POSB savings account no. 279-12328-0 Han Hui Hui.
Please help to share this meaningful activity with your friends.
Written by Leong Sze Hian, Vivian Pan and Roy Ngerng
