Retirement in Singapore requires careful planning, as the cost of living here can be fairly significant, even if you live thriftily. How much exactly do you need for a comfortable retirement in Singapore?
This article explores three distinct retirement scenarios: the Lees, who live a luxurious lifestyle; the Lims, who aim for balance; and the Wongs, who lead a minimalist retirement.
We assume that each couple lives till 85 (which is the average longevity of Singaporeans) and that they will need to fund at least 30 years of living expenses.
Each couple’s monthly expenses are broken down based on current prices in 2024, with an assumption of inflation at 2.5%.
The Lees — Luxurious Lifestyle Retirees
The Lees, both 55, live in a fully paid private condominium in the East Coast area. Mr Lee is a retired senior banker, while Mrs Lee was a corporate lawyer. Their high-income careers have allowed them to amass a significant retirement fund. They enjoy fine dining, luxury vacations, and the convenience of a private car, while employing a full-time domestic helper.
Monthly Cost Breakdown for the Lees:
- Housing Maintenance: $400 – Monthly condo fees.
- Car Ownership: $3,333 – Includes depreciation, insurance, fuel, maintenance, parking, and ERP for a $240,000 luxury sedan (10-year COE included).
- Dining Out: $2,000 – Regular fine dining and café visits (~30 meals at $70 each).
- Groceries: $600 – Premium groceries.
- Utilities and Telco: $300 – Broadband, mobile, and utilities.
- Clothing and Shopping: $1,000 – Designer clothes, accessories, and home essentials.
- Domestic Helper: $1,200 – Salary, levy, and food expenses.
- Healthcare: $500 – Regular screenings, supplements, and insurance.
- Personal Grooming: $300 – Haircuts, facials, and spa visits.
- Holiday Expenses: $2,083 – Annual travel budget of $25,000 for luxurious vacations.
- Gifts and Donations: $400 – Contributions to family and charities.
Total Monthly Expenses: ~$12,116
Total Over 30 Years (2.5% annual inflation): ~$7.9 million
The Lims — Former Public Officers Living a Balanced Lifestyle
The Lims, also 55, live in a fully paid 4-room HDB flat in Bishan. Mr Lim retired as a civil servant in a mid-senior level position, while Mrs Lim worked as a teacher. They prioritise a balanced lifestyle, enjoying occasional luxuries like eating out and vacations while keeping most costs manageable. They take public transport, handle household chores themselves, and focus on family-oriented activities.
Monthly Cost Breakdown for the Lims:
- Housing Maintenance: $80 – Conservancy fees for a 4-room HDB.
- Public Transport: $250 – MRT and buses, with occasional ride-hailing trips.
- Dining Out: $1,000 – Dining at mid-range restaurants (~20 meals at $50 each).
- Groceries: $600 – Balanced groceries with occasional indulgences.
- Utilities and Telco: $250 – Broadband, mobile, and utilities.
- Clothing and Shopping: $300 – Essentials and occasional splurges.
- Healthcare: $400 – Routine check-ups and insurance.
- Personal Grooming: $150 – Haircuts and basic skincare.
- Holiday Expenses: $1,000 – Annual travel budget of $12,000 for one long-haul and two short-haul trips.
- Gifts and Donations: $200 – Festive gifting and donations.
Total Monthly Expenses: ~$4,230
Total Over 30 Years (2.5% annual inflation): ~$2.75 million
The Wongs — Minimalist Lifestyle With Occasional Luxuries
The Wongs, both 55, live in a fully paid 3-room HDB flat in Bedok. Mr Wong worked as a technician, while Mrs Wong was a clerk. They focus on essentials, prioritising financial security over luxuries. They rely on public transport, cook most of their meals at home, and take budget-friendly regional vacations.
Monthly Cost Breakdown for The Wongs
- Housing Maintenance: $60 – Conservancy fees for their HDB flat.
- Public Transport: $150 – Buses and MRT for daily travel.
- Dining Out: $500 – Limited dining at hawker centres, quick diners, and cafes (~20 meals at $25 each).
- Groceries: $500 – Frugal meal planning.
- Utilities and Telco: $200 – Basic broadband, mobile, and utilities.
- Clothing and Shopping: $150 – Minimal spending on essentials.
- Healthcare: $300 – Basic insurance and GP visits.
- Personal Grooming: $50 – Basic haircuts and toiletries.
- Holiday Expenses: $500 – Annual travel budget of $6,000 for regional trips.
- Gifts and Donations: $100 – Small contributions to family and charity.
Total Monthly Expenses: ~$2,510
Total Over 30 Years (2.5% annual inflation): ~$1.63 million
Conclusion
Retirement planning in Singapore depends heavily on the lifestyle you envision and the financial preparation you make. For the Lees, a luxurious lifestyle with premium amenities and frequent indulgences requires approximately $7.9 million. The Lims, with their balanced approach, need around $2.75 million, while the Wongs, embracing a minimalist lifestyle, can retire comfortably with about $1.63 million.
As you can see from the scenarios above, you need to understand your lifestyle preferences to create a budget that accounts for inflation and unforeseen expenses. Note that these projections exclude bequests or significant gifts to the next generation, which could further impact your retirement savings.
Are these estimates practical, or do they feel overestimated? More importantly, how do they align with your vision for retirement?
Disclaimer: This article is for informational purposes only and does not constitute financial advice. You are advised to consult a qualified financial advisor for any investment or financial planning advice.
