THE STRESS OF FINANCIAL PRECARITY
Life expectancy at birth in Singapore has risen to about 84 years, among the highest in the world, yet Singaporeans still spend roughly a decade of those years living in ill health. Those who reach age 65, which will be the retirement age from Jan 1, 2029, can expect to live another 21.6 years on average.
To be clear, most households in Singapore are not in immediate poverty or destitution, given high home ownership and mandatory savings. At the same time, a growing share of families report feeling financially stretched.
That stretched feeling does not necessarily amount to financial precarity. But worries about whether they can absorb an unexpected financial shock can still weigh heavily on ageing households.
Financial precarity for ageing Singaporeans often has three features:
First, incomes fall faster than expenses, especially if switching to part-time work or when illness curtails work altogether.
Second, essential costs such as healthcare, caregiving and utilities take up a rising share of the household budget, leaving little room for savings.
Third, there is limited liquid wealth outside the home and CPF, so households have few levers to pull when things go wrong.
Financial precarity has been shown to be associated with chronic stress, delayed care-seeking and poorer mental health. Households that constantly worry about making ends meet are more likely to postpone seeing a doctor, skip follow-ups or default on medication.