Singapore has one of the highest saving rates in the world. This is not surprising as many Singaporeans remain deluded and believe that upon retirement they can live on about $1,000 per month. When pressed, they reveal that once they sell their HDB flat and downgrade, then, surely that windfall will be enough to tide them right through.
The sad fact is when retirement descends on them, these same people quickly realise that their saving in CPF is often inadequate. And as for their HDB flat, the current property doldrums clearly illustrate that real estate is no more the sure bet it once was.
Singaporeans have yet to learn that merely squirreling away money in the bank is the worst approach anyone can take in preparation for their retirement.
There is more to saving than merely saving!
In addition to meeting daily living expenses, retirees must also cope with definite and unforeseen events such as:
- Illness – unforeseen
- Accidents – unforeseen
- Inflation and Rising Cost of Living – definite
Inflation, like cancer, is a silent killer, a killer of your bank savings.
What you can buy for $1,000 today will, at an inflation rate of 3% per annum, cost you more than $1,300 in 10 years’ time. That’s inflation and the compounding effect of inflation.
For these reasons, you should start investing for retirement NOW.
Yes, it is good to save but saving is the first step. You need to invest your savings, you’ve to make your money work and grow.
The composition of one’s “savings” is crucial to safeguard against the twin scourges of inflation and compounding.
We agree that one should have adequate cash float for emergencies.
But it’s also crucial that one must invest to safeguard and grow one’s “savings” and not let the money idle in the bank where inflation erodes its value.
Some people, especially the wealthy and busy, utilize the services of “wealth managers or financial planners”. If that works for you – yes, seek out a professional. But do remember these professionals charge a fee for their services, whether or not you make money.
For those of you who prefer to, there is no one better motivated to safeguard and grow your investments than YOU! Yes, you.
Chinese proverb: “Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”
You don’t need to be a finance/investment expert or spend hundreds of hours to learn the skills of value investing. Our Value Investing Program is simple to learn and easy to put into practise.
You owe to yourself and your loved ones to secure your retirement, safeguard and grow your savings.
Bank savings is a good start – but it is only a start.