Financial optimism wanes in Singapore as rising living costs and inflation lead to reduced savings, yet long-term goals remain focused on property and retirement planning.
SINGAPORE: A recent global sentiment survey conducted by Fidelity International has revealed that Singaporeans, along with Hong Kong residents, are more likely to have overspent in the past six months compared to their global counterparts. The 2023 survey, which spanned 23 markets and gathered responses from over 25,000 participants, highlights mounting financial challenges amid economic uncertainty.
Released on Dec 6, the survey found that only 43% of Singaporeans and 46% of Hong Kong residents feel optimistic about their daily finances, trailing behind the global trend of improving financial sentiment. While 2023 has been marked by economic turbulence, many respondents across the globe reported feeling better about their finances, health, and work compared to 2022.
However, Fidelity noted that inflation, rising costs of living, and economic pressures remain significant stressors. In Asia, many individuals have increased their savings, but Singapore and Australia stood out as exceptions, where savings have decreased due to higher household expenses.
Retirement Savings and Early Retirement Trends
Despite financial strain, respondents in Singapore, India, and mainland China were among the most likely in the region to have boosted their retirement savings. Interestingly, Singapore and Hong Kong emerged as places where many individuals anticipate retiring earlier rather than later, a trend attributed to affordability concerns and the challenges of supporting family members or navigating job redundancies.
Optimism and Financial Goals
Globally, over half of the working population expressed optimism about the future, marking a 15% rise in net optimism. Singapore and mainland China led this sentiment in Asia, with 75% and 84% of respondents feeling positive, respectively. In contrast, Japan recorded the highest pessimism, with only 38% expressing optimism.
Singaporeans’ financial goals continue to prioritize property ownership, with 82% citing it as a long-term objective—well above the global average of 67%. Other top priorities include maintaining current income levels, ensuring financial comfort in retirement, and preparing for later life.
Expert Insights
Johann Santer, Head of Private Banking and Regional Lead for Wholesale and Wealth at Fidelity International, emphasized the importance of consistent investment to offset rising living costs and achieve financial goals.
“Despite the challenges faced by many global economies, people are feeling more optimistic about the future. As the cost of living continues to rise, people are noticing the importance of increasing their savings through investments. The best way to future-proof your savings and achieve your lifestyle and retirement goals is through consistent investment,” said Mr. Santer.
