What do Singaporeans fear the most?
NTUC Income presented 565 Singaporeans aged 25 years and above an online survey placed across all SPH digital sites from 15 Dec 2017 to 14 Jan 2018.
The results of the survey have been released, which reveals what the Singapore public fears the most.
- A majority are concerned about being diagnosed with a critical illness or meeting with an accident that leaves them paralysed, while a minority fear they can not afford a house.
The survey found that top concern for Singaporeans, with a massive 74% saying they feared being diagnosed with a critical illness or met with an accident that leaves them paralysed.
- Whereas fewer of those surveyed are afraid of housing affordability, more worried about having enough funds to provide sufficient healthcare, 37% versus 61% cited so.
- After healthcare expenses for critical illnesses, the second most prevalent concern among Singaporeans is not having enough funds for retirement, according to survey results.
Singaporeans’ fears from a mum’s point of view
Madam Jocelyn Huang, 37, Purchasing manager and mother of two children aged 4 and 1.5, offers her perspective. on juggling family, children and work commitments.
Says Jocelyn, “It can be a struggle and a never-ending quest to find balance and to ensure I have enough time, resources and energies to not let balls drop in any area of my life.”
She also talks about the importance of financial planning…
“I started serious financial planning after I got married at 30, where my husband and I looked at our bills and debts and then evaluated whether we had enough to cover for these if something should happen to both or either of us.”
“We stepped up our planning when I was pregnant with my son. And when he was born, we immediately got him covered with medical insurance, and followed up with a savings plan for his future education expenses when he turned one. I am now looking at doing the same for my daughter.”
Is she concerned about not having enough funds for retirement?
“Like many people my age, I have not seriously planned for retirement yet. It seems like now my spare funds are channeled into expenses, existing insurance, debts/loans etc.”
“My insurance adviser – who is my auntie – has been nagging me to do a new financial evaluation so that I can start planning for retirement, I have put that off so far because I don’t want to add to my financial strain.”
“It is short-sighted but I know that right now, if anything should happen, at least all my major loans and my children’s expenses will be taken care of. The next step of course is to take steps to ensure I can still retire at 65 as desired.”
Singaporeans’ fears explained
Andrew Yeo, General Manager for Life and Health Insurance, NTUC Income, gives some reasons behind these fears, and how to address them.
He says, “Generally, no one wants to be caught short when a life crisis strikes, so it is not surprising that the risk of being financially unprepared for a medical emergency tops the concerns of many Singaporeans. In this regard, buying appropriate insurance cover is a prudent way of getting protection against such risks.”
“As it is impossible to anticipate accidents, injuries, illness, death or loss of income, insurance, particularly health and life insurance, must be a long-term consideration so that it can be an effective hedge against unforeseen events should they occur.”
“This is especially important for those who are supporting intergenerational dependants, such as mothers who are financially supporting their children, spouses, parents or even siblings. Always make sure that the dependants have a sufficient safety net if anything were to happen to the insured.”
“Also, consider buying insurance such as protection plans as early in life as possible. This is because you are less likely to have certain medical conditions then, which means that you will not have any issue of insurability.”
“Typically, you should aim to have at least 10 times of your annual earnings as basic life cover. This is generally deemed an appropriate amount to protect your family and dependants against sudden financial loss in the event of premature death or other unfortunate situations.”
Myths about retirement planning
After healthcare expenses for critical illnesses, the second most prevalent concern among Singaporeans is not having enough funds for retirement, according to survey results.
When it comes to retirement, there are a lot of misconceptions about retirement planning:
1. Retirement is far away, and there is no need to start planning for it now.
It is never too early to start. Assuming you start working at 25 and you want to retire at 65, this means you have 40 years to save for it, which is a big advantage.
Early investing would enable compounding to work to your advantage and help you build a larger nest egg, while mitigating the effects of inflation.
2. Retirement planning entails giving up on some of life’s pleasures.
Saving for retirement does not mean you set aside a sizeable chunk of your monthly salaries from the start. What is important is to start cultivating the habit of saving as soon as you get your first pay cheque, whether it is saving for retirement or for big milestones you are anticipating.
For example, millennials can start by setting aside savings of at least 10% of their income on a recurring basis. With a change in financial circumstances, such as salary increments, the savings amount can increase.
It is important to set aside at least three to six months of monthly expenses as liquid cash savings for contingencies. While we have short-term obligations to fulfill, approach financial planning with a long-term perspective.
3. Retirement is the end.
Retirement is a journey towards the golden years of one’s life, not the end. It is about taking baby steps and setting aside a comfortable amount monthly and enjoying the peace of mind to live life to the fullest today while knowing that you are future ready.
Financial goals take time to realise. The earlier one starts, the more time there is for your financial plans to grow in value.
If you have a specific financial goal that you want to achieve, consider taking up a plan that matures just before you will need that sum of money. For example, if you’ve just had your baby, you can anticipate that you’ll be needing a substantial amount to send him or her off to university in 20 to 25 years’ time.
You can start by setting aside a small amount every month that goes towards your savings plan, and gradually increase this amount as your earning power increases.
Lastly, if you are unsure about saving for your retirement, it is advisable that you seek a professional financial adviser’s expertise. A financial adviser will be able to do a full financial evaluation that will look at your income and expenses, assets and liabilities and then determine what needs to be done to meet your retirement lifestyle objectives.
*The information in this article was contributed by NTUC Income.
Also READ: 4 Things I did to overcome my fear of pregnancy and childbirth