Can the portfolio career be another piece of the retirement puzzle?

THE “financial independence, retire early” (Fire) movement has grabbed headlines by challenging how we think about work, money and retirement.

Often associated with a frugal lifestyle to maximise savings, Fire advocates leaving the professional career as early as possible and then stopping work entirely, or stepping down to low-key jobs to cover daily expenses, while a nest egg compounds quietly in the background.

Similarly challenging the conventional work script and gaining quiet traction is an alternative concept called the “portfolio career”, which balances multiple income streams in ways that retain intellectual engagement while generating meaningful income.

What is perhaps under-advertised in the portfolio career is its implications for retirement planning.

Increasing relevance

At first glance, portfolio careers aren’t about retirement at all. Consider a mid-career finance professional who transitions from a full-time job to a mix of consulting and project work, perhaps even teaching pilates on the side.

Much like a diversified investment portfolio that spreads risk across asset classes, a portfolio career generates income across multiple streams from a mix of skills and experience. It requires intentional effort – upskilling or carving out time to explore alternative paths – and income may initially reduce or become more variable.

But the flexibility that a portfolio career may offer is something increasingly relevant as Singaporeans live longer.

Life expectancy at birth has improved by more than five years in the past two decades, and a 65-year-old today can expect to live a further 21.2 years on average. This means that a retirement beginning at 65 implies a drawdown period stretching well into the mid-80s.

In line with these demographic changes, the Republic’s re-employment age is on a legislated path to reach 70 by 2030, recognising that productive working life now extends well into what was once considered retirement territory.

However, legislation guarantees the right to work, not necessarily the desire to stay in the same role. Few mid-career professionals can honestly picture themselves in the same position, working at the same intensity, through to their late 60s.

The question may be more about whether one’s role remains sustainable and fulfilling at that stage. Interestingly, Singapore’s Retirement and Health Study found that 86 per cent of working adults prefer a gradual transition over an abrupt cessation, indicating the need for something in between full-time and full stop.

This is where the portfolio career offers something the single-employer model structurally cannot: the ability to work flexibly, even at reduced income, for an extended period can positively affect retirement capital.

Reducing the pure-drawdown period

The maths is straightforward. Earning even a modest income until 70 rather than stopping at 60 means drawing down savings for 15 years instead of 25, nearly halving the pure-retirement period.

The table below illustrates the difference in the capital required for various spending levels.

The gap is striking. For someone spending S$4,000 monthly, a 15-year drawdown period, rather than 25, reduces the required capital by around S$600,000.

More importantly, what these numbers don’t entirely capture is that a pure-drawdown scenario requires continuous liquidation of the portfolio assets, which creates a key vulnerability in the form of the sequence-of-returns risk.

When living expenses depend entirely on asset liquidation, a bear market in early retirement forces liquidation at depressed prices, which permanently impairs the portfolio. This is a real concern for long drawdown horizons and is a major potential pitfall of Fire.

Having supplementary earned income will mitigate this risk in down years as there is less pressure to sell, allowing time for portfolio recovery.

The Retirement and Health Study adds a further dimension. It found that nominal non-healthcare spending rose at 3.2 per cent per annum from age 65 to 85, faster than inflation assumptions in most retirement plans. Housing and home maintenance costs, driven largely by growing reliance on domestic help, more than trebled.

Extending income-producing years to reduce the pure-drawdown period offers a meaningful buffer against this trajectory.

Benefits may extend beyond the financial context.

For knowledge workers, abrupt cessation in the traditional sense of retirement can mean a sudden loss of purpose and relevance in their professional communities, which can be more significant than the loss of income. Having the means to continue working flexibly as they get older can preserve more of the mental and physical vitality that comes from remaining active and engaged.

Mindset shifts

For now, portfolio careers remain uncommon in Singapore. Full-time employment dominates, with 90.8 per cent of resident employees on permanent contracts. This reflects how little flexible work has taken hold here, compared with peer economies. Broader adoption will require mindset shifts which are gradually happening.

Singapore’s policy framework increasingly supports multi-stage careers.

SkillsFuture has substantially lowered retraining barriers through allowances and subsidies, especially for workers 40 and above. A S$5,055 post-diploma certificate in digital marketing is free after mid-career subsidies. These resources are uniquely Singaporean, and would be a waste if they are not leveraged.

Ultimately, the retirement conversation is different for everyone. Some may aspire to retire as early as possible, while others may prefer to find sustainable ways of working into their later years.

But one thing is certain: everyone is inching towards retirement, and there are meaningful advantages to extending earned income along the way.

You may not be able to construct that second lane on the very day you leave your primary role for good. The expertise, relationships and reputation that make independent work viable take years to cultivate deliberately. The time to begin is while the first lane is still running.

The writer, a CFA charter holder, has more than 20 years of experience in investment analysis and research across asset classes