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Did you know that many Singaporean retirees regret not planning for retirement earlier?

When it comes to retirement planning, everyone has different sentiments. Some may start planning from as young as 20 years old while some will only start once they reach their 40s. Well, if you have to choose whether to save your first paycheck for retirement or to spend it on travel, which one would you pick?

The latter is very tempting… I agree…

But is retirement planning something that you should only think about once you’ve reached a certain age? The answer is no. Let’s find out why…

Retirement planning for the 20s

From my years of experience as a Financial Consultant, I’ve met a few people in their 20s who are reluctant to start planning for retirement.

These people might find it unnecessary to start saving now as they have a long road ahead of them—paying off student loans, trying new things, travelling, and having the latest gadgets. There are so many things to do! Who has the time to think about retirement?

The truth is, there is no better time to start saving than now. It’s never too early to start planning for retirement because the earlier you save, the better! If you are in your 20s and you want to save yourself from future regrets, set aside a portion of your paycheck (feel free to spend the rest!) into your retirement savings and diversify your retirement portfolio!

Retirement planning for the 30s-40s

We all know how expensive the cost of living in Singapore is. If you are in your 30s or 40s and have a family to feed, you may not have enough savings in your account to have a comfortable retirement. This scenario can be especially true if you didn’t start saving earlier.

If these worries are what stopping you from saving for retirement, here’s what you can do:

  • Reduce spending

It can be difficult to reduce your spending, especially when you are accustomed to a certain lifestyle. But it’s important to save and you can start saving from as low as $100 every month. The key is to spend within your means (or even lower) and enjoy a stress-free retirement lifestyle.

  • Downsize your house

Maintaining a large house while having to support the whole family can be a challenge. If you found yourself struggling to make ends meet, consider downsizing your house and use the profits from the property sale to invest.

  • Invest

Investing in financial products with lower risk is a great way to grow your money. Although it can be tempting to invest in products with higher returns, these products come with higher risks. Should your investment fail, you may incur debt.

Retirement planning for the 50s-60s

What’s the retirement age in Singapore? According to the Ministry of Manpower (MOM), the official Singapore retirement age is 62 years old. However, it is expected to reach the age of 65 by 2030.

Now, is it too late to start planning for retirement in your 50s or 60s? No, it’s not. Although it’s going to be extra challenging for you to keep up with those who have saved from their 20s. Here’s what you can do:

  • Contribute more to your CPF

Enjoy low-risk interest on your savings with CPF and capitalise on the high-interest rates of 2.5% p.a. and 4% p.a. in your Ordinary Account (OA) and Special Account respectively. Although you can start withdrawing once you reach 55, avoid doing so unless necessary because the interest rates for your CPF accounts are much higher than the banks’.

  • Grow your wealth

Review your finances and invest according to your life stage and objectives. The main idea is to generate a steady stream of income. To do that, diversify your portfolio and adjust it regularly.

  • Delay your retirement

If you don’t want to retire early, continue working and build your nest egg for retirement. Singapore will increase the retirement age to 65 by 2030. That means you will be able to delay your retirement and use the time to fill the financial gaps in your retirement plan.

Well, if you ask me, I’ll say—It’s never too late or too early to start planning for retirement! If you can, start saving from your first paycheck. But other than saving, the next best solution for you is to select the best financial products.

Let’s talk more about this if you have any questions or concerns. Send me a WhatsApp to start!