In Singapore, raising children is increasingly seen as a major financial hurdle, with more than 40% of respondents in a recent survey saying Sing Life The survey found that most people believe having children will delay retirement and financial freedom by 14 to 15 years.
Half of the respondents estimated that it would cost more than S$500,000 to raise a child in Singapore from birth to age 21, with the median monthly cost being S$1,918.
As a result, 54% of childless consumers say they don’t intend to have more children, and 80% of consumers with one or more children say they don’t plan to have any more children.
These figures highlight how the costs of raising children are shifting financial goals and delaying milestones such as retirement.
This growing burden is part of a broader struggle, with 44% of Singaporeans believing they will never achieve economic freedom. SingLife Financial Freedom Index 2024.
The survey, conducted among 3,000 Singapore citizens and permanent residents between April and June, highlighted several significant obstacles to financial security.
Insufficient income, unexpected expenses, job insecurity and the burden of debt repayments are cited as the main factors fueling financial despair.
Respondents believe they need about S$612,045 to feel financially free, an 8% increase from last year, making this goal seem even harder to achieve now.
The survey also found that it could take consumers about 30 years to reach financial freedom, up from 27 years in the previous year’s survey.
Median annual savings have fallen to S$20,195, and it could take 30 years to accumulate enough savings to feel financially secure.
Four in five consumers aim to retire by 65, slightly above Singapore’s retirement age of 63.
They expect to need an average of S$2,856 per month for living expenses in retirement, highlighting a significant gap compared to the median monthly savings of S$1,682, and underscoring the need to build up cash reserves.
While around 80% plan to retire in Singapore, a minority are considering retiring overseas for the low cost of living, laid-back lifestyle and pleasant climate, preferring places like Malaysia, Australia, New Zealand and Thailand.
Moreover, the survey highlights significant protection gaps: While most consumers have an average of three types of insurance products, only 57% have life insurance and only 38% have critical illness insurance.
The median life insurance cover is S$286,670, less than half the recommended nine times annual salary.
The average critical illness cover was S$207,238, 12% less than the recommended amount.
Even though 78% of consumers have at least a three-month emergency fund, only one in three believe they are adequately prepared for the unexpected.
Despite these challenges, the survey offers a glimmer of hope: a slight increase in the number of people who feel they know how to achieve financial freedom offers some optimism.
But for many, the road ahead remains difficult, especially for those in their mid-30s and mid-40s who find it hardest to achieve financial freedom.
Debra Soon, group head of brand, communications, marketing and experience at SingLife, said:
“This year’s Financial Freedom Index shows that consumers are finding financial freedom increasingly difficult to achieve. The perception survey is important to understand how we can help Singaporeans find a better path to financial freedom.”
By understanding the challenges they must overcome to become financially free, we believe we can help them develop a plan and take meaningful steps to realize their dream of financial freedom.”
Featured Image Credit: Free Pick
