Is $1 Million Enough For A Retirement In Singapore In 2017?

One of the questions most people have about retirement is “How much is enough for retirement?”

For the average Singaporean, becoming a millionaire is like a dream come true. It helps to explain the snaking queues during those Hong Bao Draws at Singapore Pools. Most people can only hope.

The Mrs and I turned 30 not too long ago and we are constantly advised that it is never too early to start our retirement planning. But I am wondering if we turned 65 today, would $1 million be enough for our retirement?

$1,000,000 will last us 32 years…If we spend $42,000 a year or $3,500 a month

If we consider the following assumptions:

  • Amount is deposited in fixed deposits or short-term endowments
  • Annual returns of 2%
Yearly Expenses $36,000 $42,000 $48,000
How long $1 million can last 40 years 32 years 27 years

This $1 million will be able to last us till age 97 if we spend $42,000 every year which is also equivalent to spending about $3,500 a month.

The $3,500 a month lifestyle

Food and Dining ($1,200)
$40 a day for the both of us to settle our 3 meals. We can probably look forward to a good mix of home-cooked meals with restaurant treats a few times a week.

Utility Bills ($200)
Besides electricity and water bills, we would also have to consider conservancy fees, broadband charges and our monthly phone bills.

Transport ($300)
We would utilise public transport most of the time but we can also indulge in a few taxi trips a week if we want to explore less accessible places in Singapore.

Medical Insurance ($800)
With MediShield Life, a national healthcare insurance scheme, all Singaporeans are covered for subsidised treatment in public hospitals. While Medishield Life premiums may be fully payable from our Medisave, we would set aside $800 a month to pay for the private insurance component of our Integrated Shield Plans, which would make it more viable for us to pursue private medical care if the need arises.

Others ($1,000)
This will cover discretionary expenses like gifts, purchases at department stores and some basic maintenance expenses. We can also include two overseas trips a year. Probably a low-cost trip around Southeast Asia and another long-haul trip to East Asia/Europe/America to satisfy our wanderlust.

While the above breakdown is comfortable for some, is it comfortable with you?

For us, we are hoping for a little more wiggle room during our retirement.

Having more in our golden years with the Enhanced Retirement Sum and CPF LIFE

The extra wiggle room can easily be achieved if we set aside the Enhanced Retirement Sum (ERS) in our CPF Retirement Accounts (RA) when we reach 55 years old. At age 55, our Special and/or Ordinary Account savings will be transferred to our Retirement Account up to the Full Retirement Sum, to form our retirement sum. This sum will be used to join CPF LIFE when we would like to start receiving payouts, from age 65 onwards.

If we consider the following assumptions:

The contributions to an individual’s SA would be about $149,000 from 25 to 55. However, due to the magic of compound interest, the person would have accumulated close to $243,000 in the SA at age 55.

This means that we would have Ordinary and/or Special Account savings above the current Full Retirement Sum of $166,000 that we can apply to transfer to our RA at 55, and this amount can help us get close to meeting the current ERS of $249,000.  By setting aside the ERS, each of us can then look forward to a monthly CPF LIFE payout of about $1,860 – $2,000 from age 65.

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With our combined CPF LIFE monthly payouts, we would have enough to pay for basic needs in retirement and our personal cash savings could be used to provide extra income to supplement our other expenses.

More importantly, these monthly payouts are for life to mitigate longevity risks and we would not have to worry about outliving our savings. 

With our CPF contributions and CPF LIFE, saving for retirement is made much easier.


It does not matter if $1 million is too difficult a target for you and your partner to achieve. If $800,000 in cash and CPF is all you need for your desired lifestyle, you can use that as your planning parameter.

Similarly, if $2 million is what you desire, simply set aside more retirement savings in cash and your CPF.

Remember, your CPF savings plays an important role in building up your retirement savings.

Full disclosure: This is a sponsored post done in collaboration with the CPF Board.


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    10 thoughts on “Is $1 Million Enough For A Retirement In Singapore In 2017?

    1. jhtans

      1. the monthly expenditure of 3500 is on nominal basis. what is the real value after accounting for inflation?

      2. the FRS will not stay at 166k

      1. My 15 HWW Post author

        Hi jhtans,

        To keep the article simple, I have not taken into account inflation.

        The spirit of the article is looking at a couple nearing retirement age and if $1 million is more than enough for retirement needs.

        Maybe for us, 30 years later, $1m would have inflated to $2m and the FRS will increase to 300k. The ratio would still be similar and the calculations should work out fine too.

      1. My 15 HWW Post author

        Hi WealthyDoc,

        The standard of living in Singapore is close to most cities in the US. I am quite sure nobody in the US would come to Singapore for geographical arbitrage.

    2. Jamie

      What is a reasonable amount set aside to cater for elder care in the event that the elderly couple is unable to take care of each other physically? E.g checking into elder care home.

      My hubby and I do not have children and it is inevitable that there will be a day that both of us cannot take care of each other when we are “too old” to even manage our own physical needs.

      1. My 15 HWW Post author

        Hi Jamie,

        I feel you as the Mrs and I also do not have children yet too. As of today, $1 million should go a long way for a relatively healthy elderly couple.

        Coincidentally, I am preparing an article on the cost of nursing homes in Singapore soon and do look out for the article.

    3. Fred

      It will be great if the million does not include Home and CPF. At 65, it is a dream to have:

      1. 1 mil in Cash/ Equities/ Bonds

      2. Roof fully paid and having a fully paid investment home for rent.

      3. CPF at ERS level.

      4. Adult children do not depend on you. Grandchildren to dot on.

      5. Travelling annually; 1 long(America, Europe, Africa), 2 medium ( Japan, Korea, NZ,) and 3 shorts ( ASEAN).

      1. My 15 HWW Post author

        Hi Fred,

        In this article, we assumed that the house is paid off with all the CPF contributions.

        But yes, the 5 points which you have illustrated are surely good-to-haves in retirement.

    4. Paul Sharp

      You have described this topic beautifully, rather has made life after retirement much easier through your explanations. But the thing is first of all we need to have 10 lakhs dollars which is not easy plus not everybody wants to leave their home for Singapore. Senior citizens don’t usually want to leave the place with they are emotionally attached.

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