Saving for retirement is the top priority among affluent Singaporeans, well ahead of putting cash aside for a rainy day and education, according to a recent online poll.
It found that the ideal retirement nest-egg is estimated to be about $1.38 million, although respondents varied in how they arrived at this figure. About 55 per cent sought professional financial advice before investing while 13 per cent derived it from the media.
But around 25 per cent relied on guesswork, which is "alarming", said Mr Chris Gill, general manager, Southeast Asia at Friends Provident International, which conducted the poll in May of around 500 affluent and aspiring-affluent investors in Singapore and a similar number in Hong Kong.
It defined affluent here as having $200,000 to $1 million in investable assets while those with $80,000 to $199,999 were deemed "aspiring affluent".
Mr Gill noted: "Our view is that there is a tendency to underestimate the amount needed for retirement even among the well-off.
Our view is that there is a tendency to underestimate the amount needed for retirement even among the well-off.
'MR CHRIS GILL, general manager, South-east Asia, at Friends Provident International
"Aside from the high costs of living, longer life expectancy and increasing costs in medical bills, the impact of inflation is another important aspect for consideration."
He stressed the importance of speaking to a professional financial adviser to gain a better understanding of financial planning needs.
There is still much work to be done. The survey found that 80 per cent want to do more outside of their CPF savings for their retirement plan, while nearly 60 per cent indicated that they were not saving enough for retirement even when factoring in non-CPF savings.
Only 40 per cent of the respondents here were confident about saving enough for retirement, higher than the 18 per cent of the respondents in Hong Kong.
FINDINGS IDEAL RETIREMENT SUM
An online poll found affluent investors consider $1.38 million to be the ideal nest egg.
How they arrived at the figure:
Sought professional financial advice - 55%
Relied on guesswork - 25%
Relied on the media - 13%
LACK OF CONFIDENCE
The survey also found that:
Do not feel financially secure - 66%
Feel they are not savvy about investing and related areas - 57%
The survey found that 66 per cent of respondents said they did not feel financially secure while 57 per cent felt they were not savvy about investing and related areas.
The findings were similar in Hong Kong, where the average retirement goal of the well-off was $1.65 million. They are also more prepared to take a chance, with 26 per cent opting for high-risk and high-return products compared with 11 per cent in Singapore.
Still, a balanced investment strategy, with a mix of potentially high- and low-risk products, is preferred by individuals across Singapore and Hong Kong as a means to achieve better, safer returns in the long run.