People who are better off could boost their cash holdings by about half over a 10-year period if they move from a basic savings approach to a low-risk wealth management strategy, says a new report.
It notes that increasing numbers of those who are wealthier in parts of Asia and Africa are losing out on savings as a result of an overly simplistic approach to their personal finances.
This could add years to the time it takes to achieve savings goals. In some cases, cash is sitting under mattresses instead of in bank accounts. Basic savings methods include basic bank accounts, time and/or fixed-term deposits and regular savings plans, while advanced approaches include mutual funds, stocks/equities/fixed-income securities and pensions.
While the emerging affluent in Singapore are "active" savers, with 74 per cent putting money aside every month, 53 per cent are using basic savings accounts to reach their financial goals. About 20 per cent engage in a regular deposit savings plan while the same proportion use time deposits.
The annual report by Standard Chartered Bank polled 8,000 emerging affluent consumers in Singapore, China, Hong Kong, Taiwan, South Korea, India, Pakistan and Kenya.
Emerging affluent refers to consumers who can earn enough to start saving and investing.
StanChart said it is not surprising that 47 per cent of those surveyed in Singapore say they are far from arriving at their main savings priority. Only 22 per cent say they are close to achieving their goals.
Compared with the 2015 study, the confidence of Singapore's emerging affluent in realising their top savings targets has fallen. It dropped 15 percentage points, highlighting the importance of a suitable savings plan.
Home ownership and children's education are top savings priorities for most of the 8,000 consumers polled, ranking ahead of retirement planning. But for the 1,000 polled in Singapore, retirement (45 per cent) and children's education (42 per cent) rank higher than emergencies (37 per cent). Most of them, though, believe they will not save enough and in time for retirement. Only 7 per cent are confident of achieving this goal while less than 20 per cent feel they are close to reaching targets for their children's education.
Mr Andrew Chia, head of retail banking at StanChart in Singapore, said: "Given the relatively high cost of living in Singapore and as life expectancy increases, financial planning for the future requires a holistic strategy encompassing savings, investment and insurance to grow and protect one's wealth."
He noted that many affluent and emerging affluent customers are concerned about wealth accumulation and retirement planning.
The bank has seen good growth in the take-up of life insurance products, unit trusts and equities in past years.
The study, which was conducted by independent research consultancy GlobeScan, also indicated that those aged between 25 and 34 view home ownership as the most popular savings priority here.
And 26 per cent of this group say their top savings goal is to buy a home, compared with about 22 per cent of those polled in Singapore.