Your Savings By Age: Are You On Track?

How much money you should have in the bank or investments is a dilemma for people of all ages and walks of life. Despite being told the importance of savings for retirement, the exact money we should save, and the average savings of Singaporeans are never really discussed.

While the answer is greatly dependent on the type of lifestyle you want to have when you retire, there are factors and guidelines to help you get to your goal.

For example, your age is a major factor that affects your financial state. Understanding how long you want to work before retiring will help you reach financial milestones that will set you up for your golden years. If you haven’t started to save yet, you’re falling behind, or you need to pause, don’t get discouraged. It’s never too late (or early) to work on your savings and investments.

More From OMY: Top Financial Tips For The Sandwich Generation

Before we begin this article, we want you to think about savings by age this way: it’s not just about how much you should save, but how much you CAN save.

Here at OMY, you will discover the following:

Let’s Talk About Emergency Fund

When it comes to how much savings you have, the first thing you should keep in mind is your emergency fund. This is one of the most important savings goals that you can have.

Here’s why: Your emergency fund will help you tide over unexpected financial pitfalls. These can be serious financial roadblocks that can hamper your lifestyle and force you to cope with a number of hardships such as unemployment, unexpected medical bills, natural disasters, and many more.

But how much money do you need for your emergency fund?

As a rule, you should have at least 6x of your salary in this fund. For example, if you earn $3,000 a month, you should have an emergency fund of $18,000.

But keep in mind that this amount can change. The key is to always have enough to maintain your lifestyle and keep you afloat in the event of a financial crisis.

When it comes to your emergency fund, don’t include your CPF since you can immediately withdraw it.

Emergency Funds should be stashed in a high-yield savings account so it would simply compound interest over time.

Another thing worth pointing out is that you don’t have to start building your emergency fund from scratch. Maybe you already have savings that you can start building onto. If this is the case, you should add that to your emergency fund.

Now that we’ve discussed emergency funds, we can finally move on to your savings.

Factors That Affect Your Saving Journey

To truly understand the average savings of Singaporeans, how to save money, and how to increase your savings amount, you need to examine the things that can affect your savings journey first.

Your Education

When you start your career, your level of education will greatly affect how much you earn. For this reason, it’s a good idea to study at a reputable institution to ensure that you can land a job that can pay your expenses.

Adding more years to your studies, perhaps to earn a master’s, may also help you secure a high-paying job.

That said, education is not the only factor that can boost your earning potential.

Your Skills

If you’re good at something, then it might be easy to make money from that experience.

While some skills don’t come naturally, you can develop your skills over time. If you’re not sure where to start, evaluate what you’re good at.

You don’t want to set your sights on money-making opportunities that you’re not good at. That’s a recipe for unhappiness and failure. Instead, look for money-making opportunities that are within your skill set.

Your Salary

One of the biggest factors that influence your ability to save money is your salary. This isn’t just your monthly take-home salary, but also your annual salary (including commissions, bonuses, and the like).

This should be a part of your financial plan, as it will be one of the biggest factors in determining how much you can save. As you get better in your career, your salary may increase. While this may be good news, it can also be a downfall if you’re not ready.

National Service

Male Singaporeans need to serve the mandatory 2-year national service, which will put them behind two years compared to their female counterparts.

The Amount Of Money You Started With

If you’re lucky, your parents may have given you money to set you up when you first entered the workforce. If you’re one of these lucky individuals, then you can use this money to help yourself get a head start on your saving goals. If by some chance, you didn’t get that money, then you’re not alone. Don’t let this discourage you.

Your Debts

Most Singaporeans think that debt is not something they need to worry about. But if you look at the big picture, debt can hold you back. The more you have to pay for debts, the less chance you have to save money.

For example, if you’re working on paying off your student loans, then you’ll find it hard to save more money. Once you’re older and have paid off your student loans, you may have to deal with auto loans, mortgage loans, personal loans, renovation loans, and the like.

Your Health

It’s easy to think that your health won’t affect your financial goals, but let’s not forget that you may have to take time off from work when you’re sick. If you’re not in good health, that means that you may have to pay for more medical expenses that you may incur.

All in all, not taking care of your health can lead you to spend more, which in turn can lower your savings.

Your Location

Where you live in Singapore can also affect your saving amount. If you live in a place where the cost of living is high, you may have to spend more just to get by.

Other Obligations

Apart from your debts, there are other obligations that you may need to pay. For example, when you have children, you’ll need to take care of their education. Even if you don’t have kids yet but you’re the breadwinner of your family, you may need to shoulder your loved ones’ living expenses.

Average Savings Rate Of Singaporeans

How Much Money You Should Have In Savings and Investments According to Your Age In Singapore

According to the Singapore Department of Statistics, the average personal savings rate of people in Singapore in the first quarter of 2022 is 37.5%.

This percentage is the difference between disposable income and expenses for personal consumption. However, this average is not consistent, and it changes per quarter. Here’s a look at the average Singapore savings rate since 2012.

Year Personal Savings Rate Average
2022 (1st Quarter) 37.5%
2021 36.8%
2020 40.0%
2019 28.9%
2018 28.9%
2017 28.6%
2016 28.7%
2015 27.5%
2014 27.0%
2013 25.2%
2012 23.5%

By looking at the table above, the decade average savings rate of Singaporeans is at 30.2%. Since 2012, the savings rate has also increased.

2020 was the highest average savings for Singaporeans, and this could be attributed to the pandemic. Since many people can’t go out of their houses, they can save on costs such as petrol and transportation.

How Much Do Singaporeans Earn On Average?

To have a clearer look about savings and finances, let’s examine the average earnings of Singaporeans by looking at this 2021 Labour Force report. The average amount is categorised per age group.

Age Group 2021 Median Monthly Salary
15 to 19 $1,170
20 to 24 $2,691
25 to 29 $4,095
30 to 34 $5,222
35 to 39 $6,102
40 to 44 $6,825
45 to 49 $5,958
50 to 54 $5,070
55 to 59 $3,729
60 & over $2,543

Keep in mind that these amounts still do not include CPF and other contributions, so the take-home pay is lesser than the amount stated above.

Annual Savings Of Singaporeans

So, are you ready to see the average annual savings of Singaporeans based on age?

To help you get a better picture of how much you should save per year based on the information above, take a look at this table below. (Based 30.2% average savings rate)

Age Group 2021 Median Monthly Salary
15 to 19 S$4240.08
20 to 24 S$9752.18
25 to 29 S$14,840.3
30 to 34 S$18,924.5
35 to 39 S$2213.65
40 to 44 S$24,733.8
45 to 49 S$21,591.8
50 to 54 S$18,373
55 to 59 S$13,513.9
60 & over S$9215.8

Average Savings Of Singaporeans: What Should Be Your Savings Goals By Age?

Before we examine how much the average savings of Singaporeans should be by age, keep in mind that this table below is calculated based on the following assumptions:

  • You start working at 23 and earn the average salary
  • You will retire at 63
  • You constantly save

We did not factor in the following:

  • Inflation
  • Value of Singaporean Dollar
  • Financial emergencies
Age Group Average Savings
25 to 29 S$20,200
30 to 34 S$70,900
35 to 39 S$136,200
40 to 44 S$213,100
45 to 49 S$299,500
50 to 54 S$374,900
55 to 59 S$440,100
60 to 64 S$491,100
65 and over S$532,000

Note that this table of average net worth by age Singapore is ONLY AN ESTIMATE. Use this tablet as a basis for investment and savings goals by age. If you go a couple of thousand below the suggested amount for your age, don’t fret too much about it.

If you plan on investing your savings, here’s the average net worth by age Singapore. For this table below, we assume that you will earn 4% interest per annum.

Age Group Average Savings
25 to 29 S$24,400
30 to 34 S$87,600
35 to 39 S$179,600
40 to 44 S$303,700
45 to 49 S$460,900
50 to 54 S$640,400
55 to 59 S$847,000
60 to 64 S$1,080,000
65 and over S$1,300,800

Average Savings Of Singaporeans: How Much Money Should I Have Saved By 21?

First off, let’s consider the age of majority – 21 years old. When you reach the age of majority, you are deemed to be an adult and you’re allowed to do stuff like apply for a credit card that has a higher limit, and approach financial institutions and apply for loans.

However, for most Singaporeans, this is only when they started their career. This period is when you’re only starting to prepare financially. You’re not as worried about your life savings because your main priority is your emergency fund.

To be safe, simply start to build your emergency fund at this age. As discussed above, this should be at least 6x your monthly salary.

Average Savings Of Singaporeans: How Much Savings Should I Have At 30?

You’re almost a decade into your career and about to start a new decade in your life. This period will likely be a defining point in terms of what you have saved, and when you’ll be retiring.

When you are at this age, you may have started saving or purchasing things like a car, house, or down payment. This is to ensure that you have a nest egg to retire on.

Since this era of your life is your prime, you should start saving aggressively. Based on the table above, you should have at least S$70,900 to S$100,000 when you’ve reached 30 years old.

Average Savings Of Singaporeans: How Much Savings Should I Have At 40?

Based on the tables above, your earning potential maxes out at this age range. This is why you should take into consideration putting the majority of your earnings into savings. By 40, a good guide is to have at least S$300,000 as your savings.

Is 100k In Savings A Lot?

It should be clear that the more savings you have, the better. However, it isn’t always an indicator of wealth. Many Singaporeans want to save S$100,000 by 30 or 35.

While this amount may be a long shot, especially for those who just started their career, the trick is to remain consistent.

That being said, saving S$100,000 by the time you reach your early thirties isn’t impossible. You just need to start early and save aggressively.

What If You Haven’t Saved Much Yet?

This is certainly something to be concerned about because most adults have to contend with student loans and other financial obligations such as medical bills, the cost of taking care of their family, and many more.

You might be feeling discouraged because you haven’t even thought of starting a savings goal. There’s no need to lose hope. Remember that you can always pick up the pace.

If you’re worried about not reaching the average savings amount yet, you’re not alone. Many Singaporeans heavily rely on their CPF savings to last them during their retirement years. This is especially true for those who don’t want to save aggressively and are okay with retiring and maintaining a basic lifestyle.

How To Save Money In Singapore

Saving money in Singapore is challenging. If you want to finally be in control of your savings, follow these tips below.

Store Your Money In A High-Yield Savings Account

A high-yield savings account is a great tool that allows you to earn more interest on your savings. Plus, it’s easy to access your money when you need it.

Save At Least 50% Of Your Salary If Possible

You may not be able to save every single cent but try your best to save at least half of your salary. One of the easiest ways to do this is to live a minimalist lifestyle. This way, you’ll have expenses to take care of, which will save you money in the long run.

Max Out Your Employer’s Contribution

You should take advantage of plans that allow you to save more money. Aside from your savings, it’s also important to save as much as you can through your CPF in Singapore. You may also take advantage of the Supplementary Retirement Scheme, and follow tricks like CPF Shielding.

Diversify Your Investments

Consider investing your money in a mix of stocks and bonds. This way, your investment will be safe while giving you the potential to earn compounded interest that you can enjoy in your golden years.

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Have SMART Savings Goals

Make your goals Specific, Measurable, Attainable, Relevant, And Time-Bound or SMART. Clear and well-defined goals help you focus on WHAT you need to do and WHEN you need to do it.

You may also break down your bigger goals into smaller goals. For example, a SMART savings goal might look like this:

“By December 2023, I must save a total of $75,000 by saving $5,000 each month.”

Pay Off High-Interest Debts First

High-interest debts like credit card bills and payday loans can force you to pay a lot more than you borrowed in interest after just a few months. Paying off these debts as soon as possible will save you money in the long run.

The Best Savings Tip For You: Earn More Money

Sometimes, no matter how much you deprive yourself of clothes, food, or travel, you still won’t be saving enough money.

This brings us to the best savings advice we know: find ways to earn more money.

Your primary goal should be to grow your income instead of trying to save more money. Unfortunately, many Singaporeans put their focus on saving and fail to put enough effort into increasing their income.

It’s true that it can be hard to increase your income. But the good news is that you can do this if you’re willing to put in the time and effort. In this day and age, technology has made it easier to find work. This includes ways to make money online, which can help you earn extra cash. You may also prioritise earning passive income, which is a great way to earn money without making much effort.

A Word From OMY

Now that you know the average savings of Singaporeans based on age, you can finally have a specific goal in mind. The truth is that if you’re not saving enough, you’re compromising your financial future. But there’s no need to lose hope. Everyone’s saving journey starts somewhere.

We hope this article inspired you to save more money.

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