Less than 20% have accessed professional financial advice on retirement plans.
Half of pre-retirees in Singapore polled in a new survey are yet to make financial plans for their retirement. Commissioned by Russell Investments, the study aims to show how Singaporeans are preparing for life after work. It also charts their major concerns and fears.
In spite of longer life expectancies and government efforts to compensate by increasing the official retirement age to by 2012, the survey also found that 60% of Singaporeans plan to retire by . However, only 40% have developed - or intend to develop - a comprehensive retirement plan while only 20% have worked - or plan to work - with a professional financial adviser in this context.
"These findings are somewhat startling; they reflect the continued lack of awareness or the avoidance on the need for professional retirement planning and the implications of the increase in retirement age," Mahendran Nathan, Chief Executive Asean, Hong Kong, Taiwan and India at Russell Investments, said in the company's statement Apr 22.
The study was conducted online by The Nielsen Company. More than fully employed Singaporeans, aged between 35-55 years old participated in the poll in December 2009 and January 2010. Survey data was weighted by key demographic variables (gender, age and ethnic group) to provide a representative sample.
The research showed that many Singaporeans still view retirement as an exercise in austerity, whereby lifestyle sacrifices have to be made when full-time income stops. In fact, only half of them feel their financial health in retirement will be good or very good, which means the other half are expecting the worst.
Another fear for almost 65% of Singaporeans is that they will outlive their money. Around 70% even believe that they are ‘very likely’ to need to take up part-time employment when they ‘retire’.
"Singaporeans are actually preparing themselves for a decline in their quality of living during retirement – no wonder the majority of locals aren't looking forward to their retirement years," said Edmund Teo, Regional Director, Sales and Marketing.
The research reveals that Singaporeans have a variety of concerns about retirement, and they perceive that living a restrictive retirement lifestyle is the only way to cope. While these concerns are real and need to be addressed, the good news is that they have a disciplined savings habit and through proper retirement planning, these fears can be alleviated – and that it is never too late to start, according to Teo.
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