In an article published by the Straits Times on Sunday (‘8 money problems that worry S’poreans most‘, 21 Mar), it was found that many Singaporeans are not prepared for retirement. This means people who don’t have huge savings accounts, and still don’t do anything about it, will definitely run out of money at some point during their old age, ST said.
ST also reported that there are currently around 400,000 people aged 55 to 70 who don’t even have enough in their Central Provident Fund (CPF) to meet the Basic Retirement Sum, which is intended to provide a lifelong basic monthly income of up to $800. Currently, for CPF members turning age 55 this year, the BRS which is half of the the Minimum Sum is set to $93,000 by the CPF Board.
But even with $800, it may not be enough to see a Singaporean retiring comfortably in Singapore.
According to a 2019 study conducted by Assistant Professor Ng Kok Hoe from the LKY School of Public Policy and Associate Professor Teo You Yenn, head of sociology at NTU, a single person aged 65 and above would need at least $1,379 a month to sustain a descent basic standard of living in Singapore.
In any case, the government being aware that CPF may not be enough for these elderly, has launched a program to boost their CPF savings by providing matched top-ups of $600 annually (i.e., average match-ups of $50 a month) for the next five years starting from this year.
There are also worries that many of the younger people who are now involved in freelance work in the gig economy may have difficulties retiring when they get old. This is because such freelance work does not guarantee a stable income for the long term and would impact their CPF savings. Others, including high-income earners, are worried about pay cuts and income reduction in future, which would also impact their CPF savings and retirements.
Singapore elderly can sue children for money if don’t have enough to retire
In Australia, the retirement of elderly is well taken care of. A typical Australian who is single can get a pension amount of A$952.70 per 2 weeks, or about A$2,064 (S$2,144) per month.
In fact, most of the pension money would be spent off by the Australian pensioner, helping to drive its local economy since he or she knows they would be getting the money continuously every 2 weeks.
In Singapore, the government expects the children to fund the retirement of their elderly parents if they don’t have enough to retire. In fact, the Maintenance of Parents Act in Singapore provides for elderly aged 60 years old and above who are unable to subsist on their own, to claim maintenance from their children. Parents can sue their children for lack of maintenance, in the form of monthly allowances or a lump-sum payment.
This law, of course, also applies to the children of Singapore’s ministers. But with the millions of dollars of salary earned by the ministers each year, it is unlikely that they would be unable to subsist on their own when they retire. In fact, the amount of money they earned should be able to fund the retirements of at least 3 of their generations.