Friday, 3 October 2014

Living without money: Nearly half of Singaporean households living from paycheck to paycheck

I refer to this link,
Living without money: Nearly half of Singaporean households subsisting from paycheck to pay check



Quoted:

"Savings rates are way too low across the island."

"Here’s an uncomfortable truth about Singaporean households: a report by CLSA revealed that almost half of households across the islands are saving less than 10% of their monthly incomes, leaving them unable to cope with unexpected financial expenses."

The report revealed that 30% of Singaporean households save less than 10% of their incomes, while an alarming 14% have no savings at all.

Majority of elderly respondents are not saving money during their retirement, as most are focused on enjoying their money during this period. However, a high proportion of residents in their 30s and 40s are also unable to save.

Unsurprisingly, 73% of low-income households are saving less than 10% of their monthly income. However, an unexpected 37% of the top-income bracket is essentially spending everything they earn.

“In our view, as a result of the low savings rate, the high proportion of total wealth in non-liquid assets (eg property, CPF, insurance) and high optimism about future earnings potential, 47% of households do not have enough funds readily available to cope with unexpected financial expense,” stated CLSA.


Subsisting from pay check to pay check in other words simply means being a wage slave. You survive on one month's pay check and look forward to the next.

But what if that pay check stops coming? Are you financially prepared to face the worst?

1. Do you have an emergency fund?
2. Do you have alternative streams of income?
3. Do you have enough savings?



Half of Singaporean households are saving less than 10% of their monthly incomes, leaving them unable to cope with unexpected expenses. Do you want to be that half?

14% have no savings at all, do you wanna be part of that 14% possibly increasing it to 20% or even 50% in the future?

37% of top income earners spend everything they earn. When you're earning a lot, they get over-confident. They throw caution to the wind, thinking their pay checks will last for the rest of their lives. Will it?

I've always been an advocating of saving for a rainy day. Sure, materialistic expenses come along once in awhile. After all, we're only human.

However, I do have savings stashed away for a rainy day.

My blogposts in the past have touched on this matter at hand and similar subjects as well. If you wish, take a look and see what I think. And maybe, just maybe it'll help you too.










Signing Off,
Teenage Investor

3 comments:

  1. Very true! Before learning how to invest, we should learn how to save first ;-)

    ReplyDelete
    Replies
    1. Hi Richard, thanks for agreeing with me! Saving is the most important thing before anything else!

      Delete
  2. Spending less than you earn, is certainly a necessary first step to creating the capital to grow one's investment. I fully agree.

    ReplyDelete