More than half of Singaporeans aged 45-64 have yet to plan their retirement
Their inaction towards retirement could be due to the “lack of awareness,” says a study.
Over half (54%) of Singaporeans aged 45-64 have yet to plan their retirement, a study by wealth management services, St. James’s Place Asia, found.
According to the study, Singaporeans’ inaction towards retirement could be due to their lack of awareness, given that 57% of them do not fully understand the available financial products and services that can help them plan for retirement and manage immediate financial issues spurred by the pandemic.
Being unaware of these services, about 48% of those surveyed had to draw down from or reduce retirement contributions since the start of the pandemic.
Middle-aged Singaporeans (55%) were likewise unprepared for inflation, according to the study, which is why most of them (72%) are making lifestyle sacrifices now in the hope they can enjoy a better retirement.
In retirement, Singaporeans also anticipate that they will need to make further spending cuts, including reducing expenditure on luxury goods (45%), social life (34%), and travel (30%).
Whilst Singaporeans lack preparation for retirement, 82% of those approaching such a stage said they have sought professional financial advice before making major financial decisions, with 90% saying the advice they received has been useful.
Singaporeans said they need advice most on investments (87%), insurance (74%) and retirement planning (72%).
Top sources of financial advice for Singaporeans over 45 years old are now independent advisers and banking relationship managers, surpassing family as the leading source of advice for almost every investment type. Receiving advice face-to-face is critically important to 77% of this age group. For long-term planning, most would prefer to visit a financial adviser (51%) or their bank (31%) over engaging with a robo-advisory platform at just 14%.
“It is heartening to see that so many Singaporeans over 45 are receptive to financial advice as they approach retirement, which is notably higher than for other age groups. This openness to advice is likely due to the increasing complexity of our financial affairs as we age, and the need to plan carefully to avoid passing on issues to the next generation,” Gary Harvey, CEO of SJP Singapore, said.