It’s hard to tell how much money you should have by a certain age. Each one of us live different circumstances and lifestyles – which means how much we save is a very personal thing that can never be answered in several hundred words.
This means any figure that we arrive at should only ever be used as a point of reference. If we haven’t achieved it, then it can serve as a goal. If we have achieved it, there’s no reason why we cannot do more.
How Much Does An Average Singaporean Save?
According to the Department of Statistics Singapore, the personal savings rate is 31.3% in the second quarter of 2023. Personal savings is calculated as the difference between our disposable income and personal consumption expenditure on goods and services.
However, we should also note that this rate changes each quarter, and to really understand how much you should be savings, it is more prudent to look at a longer horizon. We calculated this to be 34.1% over the past 10 years.
| Year | Personal Savings Rate |
| 2023 (2 Quarters only) | 34.1% |
| 2022 | 35.4% |
| 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% |
| 10-Year Average Savings Rate | 34.1% |
Source: Department of Statistics Singapore
Looking at the data, we can already see how it can be unrealistic for some Singaporeans to save 34.1% of their disposable income on average. The personal savings rate has been steadily increasing since the 1980s. Even since 2010, the rates have drastically shot up – ranging from 17.2% to 24.3% in that year.
Nevertheless, it was hovering above the 27%-mark up until 2019. In 2020 and even 2021, the personal savings rate shot up nearly 10 percentage points – likely due to COVID-19.
For the purpose of calculating how much savings we should have, we will use the personal savings rate of 34.1%, even though it is skewed by the COVID-19 period.
How Much Does The Average Singaporean Earn?
In the Labour Force in Singapore 2021 report, we can see the median monthly salary for Singaporeans within each age group. We can further narrow down their take-home salary by excluding the employer and employee components of their CPF contributions.
| Age Group | 2022 Median Monthly Salary (excluding Employer CPF) | 2022 Median Monthly Take-Home Pay (i.e. excluding Employer CPF AND Employee CPF) |
| 15-19 | $1,440 | $1,152 |
| 20-24 | $2,500 | $2,000 |
| 25-29 | $3,850 | $3,080 |
| 30-34 | $5,000 | $4,000 |
| 35-39 | $5,850 | $4,680 |
| 40-44 | $5,958 | $4,766 |
| 45-49 | $5,833 | $4,666 |
| 50-54 | $5,000 | $4,000 |
| 55-59 | $3,792 | Approx. $3,128 |
| 60 & over | $2,475 | Approx. $2,299 |
Source: Labour Force in Singapore 2022 report
Read Also: What’s The Median Salary In Singapore (At Every Age, Gender, Education and Race)
How Much Money You Should Be Saving At Each Age Group?
From the two data sets above, we know how much money individuals in each age group should be earning and the average personal savings rate in the past 10 years. Hence, we can calculate how much money a person would save each year.
| Age Group | 2022 Median Monthly Take-Home Pay (i.e. excluding Employer CPF AND Employee CPF) | How Much You Should Be Saving Each Year (34.1%) (Month) |
| 15-19 | $1,152 | $4,714 ($393) |
| 20-24 | $2,000 | $8,184 ($682) |
| 25-29 | $3,080 | $12,603 ($1,050) |
| 30-34 | $4,000 | $16,368 ($1,364) |
| 35-39 | $4,680 | $19,151 ($1,596) |
| 40-44 | $4,766 | $19,502 ($1,625) |
| 45-49 | $4,666 | $19,093 ($1,591) |
| 50-54 | $4,000 | $16,368 ($1,364) |
| 55-59 | Approx. $3,128 | $12,800 ($1,067) |
| 60 & over | Approx. $2,299 | $9,408 ($784) |
How Much Savings You Should Have At Every Age Group
we want to estimate how these savings grow as we age, we need to factor in other considerations/assumptions:
- we start working at 23 (and don’t have any other savings/income except from work)
- wages do not increase over the years (hopefully this is offset by inflation factors)
- savings do not increase in size (also hopefully offset by inflation factors)
- personal savings rate stays the same (which will never happen, as we’ve already seen above)
- We retire at 65 (the long-term targeted retirement age today)
- We do not include our CPF savings (which can be substantial as well)
Even then, this feels like the estimate is going to be sketchy – so take the numbers with a pinch of salt. Moreover, those who are older today (i.e. perhaps above 40), would have had a much lower personal savings rate as well as smaller take-home pay earlier in their career.
| Age Group | How Much You Should Have In Savings (In Total) |
| 25 | $28,971 |
| 30 | $95,751 |
| 35 | $180,374 |
| 40 | $276,480 |
| 45 | $373,581 |
| 50 | $466,321 |
| 55 | $544,593 |
| 60 | $605,201 |
| 65 | $652,241 |
Just with savings alone, an average Singapore could have over $650,000 by the time they turn 65. Of course, we should also aim to grow our savings by investing it. There are several ways we can grow our savings.
For a start, we can simply put it into the CPF system – and grow our savings by 4% per annum (or more!) – if we do not want to take on any investment risk. If we are able to stomach some investment risk, we may be able to grow our savings pot even more.
This number also does not include our CPF savings we could have at 65. The current median CPF savings range at 65 today is between $140,000 to $160,000.
Read Also: How Much CPF Savings Should You Have At Every Age Group
How Much Money You Should Have If You Invest Your Savings
If we are able to earn a return on our savings, we can potentially see our savings pot increase by a very large amount. This is how compound interest works.
One other assumption we have to make at this point is how much returns we are able to earn from our investments. For the sake of calculating this number, let’s take two figures – 4% (characterised by the CPF Special Account returns). Of course, if we can earn a higher return, we will be able to have even more savings.
| Age Group | How Much You Should Have In Savings (In Total) (without investing) |
How Much Money You Should (If We Earn 4% Returns On Our Savings) |
| 25 | $28,971 | $29,966 |
| 30 | $95,751 | $108,485 |
| 35 | $180,374 | $223,426 |
| 40 | $276,480 | $375,911 |
| 45 | $373,581 | $562,573 |
| 50 | $466,321 | $785,146 |
| 55 | $544,593 | $1,040,336 |
| 60 | $605,201 | $1,331,665 |
| 65 | $652,241 | $1,671,131 |
Finally, we should realise that these figures are merely numbers that are calculated based on information and certain assumptions. Rather than simply dismiss these figures as unrealistic or become dejected if we are behind, we can use this as a basis for our savings and investments goals.
The post How Much Money You Should Have In Savings (And/Or Investments) According To Your Age In Singapore appeared first on DollarsAndSense.sg.
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