money – Singapore Maths Tuition

How much to retire in Singapore? (Reliable Sources Only)

A popular question (which is also related to financial Math), is how much money does it take for a person to retire in Singapore? We will collate reliable sources and their calculations in this blog post. By reliable, we mean that we will only select sources posted by major banks (POSB, OCBC, etc.), as well as those posted on major Singapore news outlets (Straits Times, Today, Channel News Asia etc.). Major insurance companies (AIA, Prudential) etc, can also be considered. Lastly, we also consider famous blogs like Mothership, Seedly, MoneySmart.

We will also post the relevant “metrics”, which include Retirement Age, Retirement Monthly Income, Years to Retirement.

Note that the Straits Times has estimated that a recommended Retirement Monthly Income is $1379, or around $1400. This covers mostly necessary items only, with just a few small “luxuries” like “occasional inexpensive meals out with family or friends, homes that are safe and comfortable, and an annual holiday to a nearby destination”. Note that air-conditioning and owning a car is excluded from the budget.

(Note that this list is not finalized, we will continue to add new sources here when we encounter one.)

1) OCBC: S$1.3 million

OCBC has a very interesting “fishing video” featuring a talking fish. In it, it is calculated that “to retire in 20 years and live on S$3,000 monthly, you need S$1.3 million”.

Retirement Age: 62

Retirement Monthly Income: $3000

Years to Retirement: 20

Talking fish from OCBC Video and its retirement calculation!

2) Mothership: S$720,000

This plan is worked out by Daniel, 29, and featured on Mothership. His retirement plan is to spend “30 years on a piece of farmland bought overseas, where he will build a ranch, and live off the earth surrounded by free-roaming livestock”.

Retirement Age: 50

Retirement Monthly Income: $2000

Years to Retirement: 21

The $720,000 can be broken down into S$360,000 cash and S$264,000 in his CPF Retirement Account at age 55 years old. Note that the above doesn’t quite add up to $720,000. That is because the CPF amount is for ensuring that he will “receive a steady stream of monthly payouts of around S$2,110 from age 65 for as long as he lives”.

3) Mothership: S$360,000

This is another plan from Mothership, by Melanie, age 25, female.

Retirement Age: 70

Retirement Monthly Income: $3000

Years to Retirement: 45

Again, the magic number seems to be “S$264,000 in her CPF Retirement Account at age 55”. Melanie can then defer her monthly payouts to 70. She will then receive around $2,600 per month for as long as she lives.

4) Seedly: $228,960 to $473,760

The Seedly blog calculates that one would need $228,960 to $473,760, depending on the age of retirement. It is summarized in the table below.

Retirement Age	Average Life Expectancy Of Singaporeans	Years Left To Enjoy Retirement	Retirement Savings Required
50	82.9	32.9	$473,760
55	82.9	27.9	$401,760
62	82.9	20.9	$300,960
67	82.9	15.9	$228,960

The above is based on:

Retirement Monthly Income: $1,200

This is on the low side considering the Straits Times article that recommends $1379 for monthly retirement income. Nevertheless, the amount of total retirement savings required seems quite low compared to OCBC and Mothership.

Citi Maxigain update: S$70,000 required

Recently received the following update:

With effect from 2 January 2019, please note that the following changes will be made to your Citi MaxiGain Savings Account.

A base interest rate equivalent to 70% of the 1-month Singapore Interbank Offer Rate will be paid on the first S$150,000 of your MaxiGain account
A daily end of day balance of at least S$70,000 must be maintained to earn base interest
Bonus interest rate will be paid on the first S$150,000 of your MaxiGain account

Source: https://www.citibank.com.sg/gcb/deposits/mxgn-savacc.htm

Basically, for accounts below S$70,000, the maximum interest rate is now 1.2% provided there are no withdrawals. Hence, effectively it is like a Fixed Deposit with 1.2% interest with the slight benefit that you can still perform withdrawals if you want, but the interest rate drops to 0.6% (6 counters).

Previously, the interest rate was exceptionally fantastic at around 2.2% (depends on the SIBOR rate). This fantastic rate is still available for amounts of S$70,000 and above.

Possibly a short term fixed deposit like CIMB or ICBC may be a better choice now, for amounts below S$70,000. Both CIMB and ICBC have offers of around 1.9% interest rate for their fixed deposits.

Read our previous post: Best “Do-nothing” Saving Accounts in Singapore (Better than Fixed Deposit)

Higher paying job than Doctor / Lawyer

We encourage top students to look beyond the traditional Singaporean jobs of Doctor / Lawyer as there are new emerging jobs that can equal or even surpass the pay of Doctor/Lawyer.

At the end of the day, do also consider your passion and aptitude, which may be more important than the salary. No point being stuck in a high paying job that you absolutely hate.

Do share this post with your children/relatives/classmates who may be choosing their courses after receiving their ‘A’ level results.

Source: Todayonline

SINGAPORE — A high-paying job as a doctor or lawyer has traditionally been the career path that many Singaporeans aspire to. But there is now a new kid on the block, with double degree graduates in business and computer science joining the ranks of top earners here.

According to the latest graduate employment survey released by three local universities on Monday (Feb 26), fresh graduates from Nanyang Technological University’s (NTU) business and computing science double degree programme commanded a median starting salary of S$5,000 last year, up from S$4,600 in 2016.

The median salary for the batch of 20 graduates matched that of their peers who graduated from the law and medicine faculties. They were also in demand with employers, as they recorded a 100 per cent overall employment rate.

Meanwhile, fresh computing science graduates were also among the highest paid last year. Those who graduated from this course in NTU got a median starting pay of S$3,850 last year, up from S$3,500 in 2016. Their counterparts from the National University of Singapore (NUS) received S$4,285 – S$285 more than in 2016.

However, rankings differed for 75th percentile salaries — the base salary of the top 25 per cent of the batch — as SMU-schooled lawyers emerged as top earners at S$5,840, compared to NUS doctors’ starting pays of S$5,305, and S$5,362 for NTU’s business and computer science graduates.

Growth of starting salaries in law and medicine was tepid, however, as law graduates from NUS and SMU only received about S$100 and S$150 more respectively last year, while NUS doctors banked in about the same amount as their seniors.