Retirement planning may not be a topic that comes to mind when you are in your early thirties and forties. It may seem like something to think about at the end of your working career, but starting early is crucial in setting yourself up financially for your desired post-retirement lifestyle.
Why can’t I just depend on my CPF?
While most of us have CPF savings, the bulk of it will likely be used for property needs and medical coverage. The majority of us will unlikely have enough in our CPF accounts for discretionary spending on items like holidays and gifts, while maintaining a desired lifestyle during our silver years.
An article published in The Business Times cited a 2019 study conducted by researchers from different institutions, where it stated that one will likely need $1,379 a month to sustain a basic lifestyle during his retirement years.
Factoring in inflation from now until the end of your career, you will probably need more than that amount to get by.
Why start your retirement planning early?
When you reach the mid-stage of your career, your earning power is at its peak, especially in areas of stability and progression. This would be an ideal time to consider planning for your retirement. It is never too early to get started; in fact, it may become tougher if you are too late, more if you have not been setting aside enough savings or investing with returns.
So, what should I do for my retirement?
Consider the kind of lifestyle you would like to enjoy after you retire. To see how much you need, try out our retirement calculator, which takes into account your age, inflation levels, and when these retirement funds will be drawn. This sets you up for a realistic goal that you can work towards in order to achieve your desired lifestyle.
Depending on the lifestyle you choose, there are products that can help you guarantee your monthly retirement income, with the flexibility to customise the savings amount based on your retirement needs, such as Prime Retirement by Great Eastern.
Generally, the earlier you start retirement planning, the more time you will have to achieve your desired lifestyle.
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This policy is protected under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC). Coverage for your policy is automatic and no further action is required from you. For more information on the types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact us or visit the Life Insurance Association (LIA) or SDIC websites (www.lia.org.sg or www.sdic.org.sg).