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1 in 3 Singaporeans do not invest, most financially unprepared for retirement: OCBC survey

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About one-third of Singaporeans do not invest and see investing as a form of gambling, even as the majority of respondents were found to be financially unprepared for retirement.

ABOUT one-third of Singaporeans do not invest and see investing as a form of gambling, even as the majority of respondents were found to be financially unprepared for retirement.

In particular, half of those among the sandwiched generation – people who are supporting both ageing parents and their own children at the same time – struggle to cope, with significantly greater worries about their financial status compared to the average Singaporean.

These are some of the key takeways from OCBC’s inaugural Financial Wellness Index, which polled 2,000 working adults in Singapore between the ages of 21 to 65 for the state of their financial health.

Overall, Singapore received a score of 63 out of 100 in its first ever study, indicating that Singaporeans have started taking care of their financial health, but are still behind on most indicators.

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There are 26 indicators altogether, including factors such as regular rate of savings, investments, financial retirement planning and having enough funds in times of crisis.

The study found that most Singaporeans are aware of the basics; they save an average of 26 per cent of their salary, with 82 per cent who proactively got insurance coverage.

But they fared more poorly when it came to investments. Some 34 per cent do not invest, while 36 per cent of investors have investments not performing to their targets. Out of those who invest, 27 per cent speculate excessively for quick gains.

Most are neither equipped for financial emergencies nor well-prepared for retirement. About half have enough savings to last six months, while almost three-quarters are not on track with their retirement plans. Some 65 per cent of respondents are not accumulating enough funds to maintain their lifestyle after retirement.

In particular, the sandwiched generation were found to have more financial worries compared to the rest, with half of them finding it tough to support both their parents and children. Out of the half who find it difficult, some 63 per cent are concerned that they are not able to spend comfortably beyond the basics, compared to the Singapore average of 51 per cent.

About 74 per cent of this group worry that the economy will not improve in the next 12 months, compared to the average of 70 per cent.

The survey also found contrasts in how different categories fared in their financial health, notably in terms of marital status and gender.

On the latter, women were found to be more averse to investing, with 39 per cent of them having no investments compared to 31 per cent of men. Some 69 per cent of married people have their own investments, compared to 62 per cent of singles.

According to Koh Ching Ching, OCBC's head of group brand & communications, the financial wellness survey is a first in Singapore in terms of comprehensiveness of scope. Going forward, the survey is expected to be conducted annually, with eventual plans to roll it out across OCBC’s markets, with Hong Kong or Malaysia slated as the next in line, she said.