
"As soon as possible" is the likely answer of many when asked of their ideal retirement age. However, while the official retirement age is set at 62 in Singapore, will you really be able to stop working then?1 With an increasing number of Singaporeans preparing to keep working until age 70 or beyond, an early retirement may just be another pipe dream for many Singaporeans.2 This is because while there are no fixed or "correct" age to retire, many do not actually start planning for retirement until the age of 38.3 Therefore, with your ability to retire dependent on your financial situation, a late start to retirement planning may then result in the inability to retire at 62. In this article, we highlight the 3 considerations you should have when planning for your retirement.
(See "The Secret To Retirement Happiness")
#1 Financial situation
With retirement signalling the end of our working life, a lack of financial independence and high debt or liabilities may make it harder for you to retire. Therefore when considering retirement, it is important for you to first assess your current financial situation. Do you have any outstanding loans or other financial liabilities? Some examples of these may include the cost of education for your children and/or mortgage loans.
(See "3 Financial Resolutions You Can Achieve In 2019")
Start Planning For Your Retirement
#2 Retirement lifestyle
Next, think about how you wish to spend your time while in retirement. Would you want to enjoy a full retirement or are you only thinking of semi-retiring? Other factors such as how frequent you intend to travel and the option to downsize your house could also affect your ability to retire.
By determining how you wish to spend your time in retirement, you would then be able to better estimate your retirement expenses. This allows you to set a retirement goal to work towards.
(See "The Best Places To Retire For Singaporeans")
#3 Retirement income
Lastly, consider your retirement savings and whether you have sufficient passive income to sustain your retirement expenses. With CPF's "retirement pay-out age' only commencing at age 654 and the official retirement age set at 62, this leaves an income gap of 3 years. You may therefore wish to consider alternatives to ensure a stable stream of income in retirement. To get a lifetime of income, perhaps consider annuities.

Annuities are a type of life insurance typically used for retirement planning. Individuals have the option between a one-time payment and a limited payment period with regular pay-outs commencing at your specified retirement age. With a lifetime stream of income, this provides income security thus offering a solution to the fear of outliving your savings in retirement.
(See "The Beginners Guide To Understanding Insurance")
Discover Your Retirement Needs
Available Products on FSMOne Insurance |
Term Life, Whole Life, Critical Illness, Annuity, Health, Endowment from Etiqa Insurance, Manulife, NTUC Income and Tokio Marine Life Insurance *Please check with our advisory team if the product you want is available on FSMOne Insurance |
1Source: https://www.mom.gov.sg/employment-practices/retirement
3Source: https://www.straitstimes.com/business/invest/8-myths-about-retirement
4Source: https://www.cpf.gov.sg/Members/Schemes/schemes/retirement/retirement-sum-scheme#
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