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Two in every five Singaporeans (44%) have not yet started saving for retirement, including 31% of those aged 55 and above.
These findings have been detailed in Aviva’s Consumer Attitudes Survey, which polled 1,000 respondents from Singapore above the age of 18.
Respondents who have yet to start saving admit that they cannot afford to save (41%), while a quarter prefer to save for other priorities, such as their children’s education.
“Often, people guess rather than calculate how much they need. They may underestimate the amount required and think they still have time to delay saving,” commented Daniel Lum, Aviva Singapore’s director for product and marketing.
“On the flip side, they could also overestimate the amount needed and intimidate themselves into not making a decision. Either way, it is not helpful as without a goal, you will not be able to put together a plan to get there.”
Among those who have started saving for retirement, the largest number (64%) rely on the Central Provident fund (CPF) as the main source of savings.
54% intend to supplement this with endowment or investment-linked plans, while 45% have direct investments such as shares or bonds.
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Medisave and MediShield have been found to be the most preferred means to fund old-age medical expenses, at 73% and 70% respectively. 34% also intend to utilise their Integrated Shield plan.
“Many Singaporeans have their savings tied up in property and they need to consider unlocking returns from such assets to supplement their retirement fund,” said Lum.
“The challenge remains for Singaporeans to build a diversified retirement portfolio that earns returns high enough to beat inflation, as well as to ensure they will have sufficient cash in their later years, rather than being asset-rich but cash-poor.”