Wednesday, 15 October 2014


Does this title above shock you?

It shocked me too.

I read this from a link from The Real Singapore.

The article claimed that you would require at least SGD$ 2 Million to retire comfortably.

How did they arrive at this calculation?

Firstly, they assume that you're a graduate and have an annual salary of $40,000 which would bring your monthly salary to be $3,300-$4000/month.


You just finished school and started working at age 25
You live the life of a regular Singaporean lifestyle that requires $4000 per month during retirement
You have a car to maintain
You aim to take 1 vacation a year during your retirement
You retire at the age of 65 (Current Retirement Age)
You live till the ripe old age of 85
(Average Life Expectancy in Singapore is 80 for Men and 85 for Women)

That means you would need…

$4,000 x 12month = $48,000 a year

$48,000 x 20 years = $960,000 (Approx. $1 Million)

Can you imagine? You would need almost a million dollars to retire! How long would it take for you to save a million dollars? If you are earning $40,000 per annum, that is 25 full years! Don’t forget you are only working for 40 years (from 25 to 65), and you still have to pay for your house, provide for your family and spend on daily expenses. How are you ever going to save a million dollars just by working? It is honestly a rather impossible task, which is why you definitely have to find other sources of income. Now, even if you manage to scrimp and save to obtain your one million dollars worth of savings, I have another piece of bad news for you…

You mustn’t forget to add in the effects of inflation.

Remember how you always have to put up with your grandfather stories about how coffee used to cost only 10 cents and a bowl of noodles was only 30 cents? By the time you retire, you would be in those grandfather shoes!

Your one million dollars is probably not going to be enough 40 years down the road!

Do you think those prices would double or triple in 40 year’s time? Of course they will… I personally think there might even be a possibility of it quadrupling! However, let’s just take a very conservative approach for this calculation. I don’t want to scare you off with my estimates. Let’s assume prices will only double once.

So if I were to adjust the calculations for inflation…

$960,000 x 2(Adjusted for Inflation) = $1,920,000 (Approx $2 Million)

You will need about two million dollars to retire in 40 years time! There’s absolutely no way you can achieve that target just by working at your day jobs. That is why I’m so convinced that everyone needs to pick up some financial literacy classes to learn how to invest. Unfortunately, these are classes that are not normally taught in your schools or universities.

Credits: The Real Singapore

That's honestly frightening! What do you think?

Signing off,
Teenage Investor


  1. There may come a tipping point in history of man where there is a significant majority of people who have a keen interest in financial knowledge.

    Then, financial knowledge will become useless.

    we are now, too far away from that.
    so much so that there doesn't appear to be imminent danger in a few decades time.

    While we are not there, those who know more will profit disproportionately more from those who don't.

    Til then. When the difference becomes insignificant.

    1. Wow SMK! That's very deep. But, care to elaborate more on why there is no imminent danger? Don't understand that part

  2. True. Somebody must lose their hard-earned money to someone else as investment gains.

    It is how market works!

    1. Haha, in a perfect world we would all be able to retire happily without worries :/

  3. Investing cannot be taught. I must be done, felt, and learnt from. Knowing the mechanics of investing is easy, being an investor successfully is a different thing altogether. I know how to kick a ball in a way that will make it curve, that doesnt mean i have what it takes to be a cristiano ronaldo.

    There is some truth to that article. But its main purpose is to illicit fear. which is counter productive. Instead of worrying, people should work and invest in their skills. Have the desire to be better and add value to your career. Spend less than you earn and do some simple low risk investments along the way that match inflation.most importantly, stay healthy and positive. With all these you wont be the richest person in sg, but you will be alright and comfortable.

    1. Hi anon! Agreed! Being contented is the first step people need to learn too.