21 October 2015
SINGAPORE – Manulife, a leading provider of insurance, retirement and wealth management solutions in Singapore, released new research* that showed an increase in confidence and understanding of the Central Provident Fund (CPF) among middle-class and affluent Singapore investors1.
The number of investors surveyed who were confident in the CPF increased year-on-year from 20% to 31%, while those who felt they understood the system increased from 27% to 39%.
Investors who participated in the survey expected 22% of their retirement income to come from CPF and another 22% from continuing to work after retirement, which formed their top sources of retirement income. In contrast, financial assistance from family was expected to make up only 3%, suggesting a desire among those surveyed to be self-reliant in their retirement years. That said, only 3 in 10 had bought personal retirement plans to supplement their retirement income.
Mr. Naveed Irshad, President and CEO of Manulife Singapore, commented on the findings:"People may plan to continue working after they retire to stay active and generate extra income. However, this may not be feasible due to increased health risks that come with age. To ensure financial security in their golden years, it is important for Singaporeans to plan early and build up multiple and diverse sources of income."
Understanding about CPF appears to be lower amongst female investors surveyed. Only 31% of female investors felt they had a good understanding of CPF and the benefits available, compared to nearly half of their male counterparts (47%). As the number of working women in Singapore continues to grow – reaching a record 76% of working age women last year2 – and more women make contributions to CPF, further education about CPF can help women better prepare for retirement.
Nevertheless, both men and women surveyed would like to see more education on investment planning from the government and financial industry, with this ranked top (69%) in a list of enhancements investors would like to see to the CPF. This statistic accentuates the need for greater collaboration between the public and private sectors to educate the public about CPF and retirement planning.
Mr. Irshad added:
"At Manulife, we recognise the importance of working in tandem with the public sector to actively educate Singaporeans about retirement planning. We are committed to helping Singaporeans prepare for retirement through our comprehensive range of retirement solutions and expert advice around retirement planning."
1Based on 500 respondents who are middle class to affluent investors based in Singapore aged 25 years and above, with a minimum monthly personal income of S$2,500 or investable assets of S$50,000 or above. They are the primary decision maker of financial matters in the household and currently have investment products.
2Singapore Workforce, 2014, Ministry of Manpower, Singapore Government