As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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Friday, 20 April 2018

Even millionaires have cost worries if they live to a 100

Read? Even millionaires have cost worries if they live to a 100

CW8888 : Cham liao for those planning F.I.R.E at 30s or 40s!

CLOSE to half of Singapore's millionaires expect to live to 100, and this is driving significant changes to their spending, investing and legacy behaviour, a study by UBS has found.

UBS Investor Watch Research has found that 46 per cent of those polled in Singapore expect to live to 100, compared to 53 per cent globally.

The expectation of a long life is creating anxiety, however, as 42 per cent worry that their wealth will not support them till age 100. Of these, 66 per cent worry about the rising costs of healthcare, and 63 per cent worry about whether they can afford their current lifestyle in retirement.

In Asia, 45 per cent worry about their wealth lasting till 100, compared to 21 per cent in Europe.

Investment behaviour is expected to shift as 45 per cent plan to adjust their long term financial plans and 46 per cent their spending patterns.

The research surveyed 5,000 millionaires in 10 markets, with at least US$1 million in investable assets (excluding property). The markets included Germany, Hong Kong, the US and UAE. In Singapore, 400 individuals were polled between December 2017 and April 2018.

Singapore's average life expectancy, based on World Health Organisation data last year, was 83.1 years, compared to 83.4 in Switzerland and 83.7 years in Japan.

Hartmut Issel, UBS head of Asia Pacific equities and credit (chief investment office), said: "It it heartening to note that many Singaporeans already have a financial plan in place, and are adjusting their investment portfolios in preparation for a longer life span.''

The silver lining is that almost 80 per cent have a financial plan in place. "If 80 per cent see the need to plan for the long term, it tells us that 20 per cent don't hold that view strongly. We need to reach that 20 per cent as well to have a discussion on life expectancy. You need to think about how you invest and put a plan in place.''

Singaporean millionaires believe being healthy is the top priority: 83 per cent worry that their health will deteriorate over the next 10 years and 92 per cent say investing in their health is more important than growing their wealth.

The average wealthy Singaporean would sacrifice around a third of their wealth today if that could guarantee another 10 years of healthy life.

The majority (85 per cent) believe that activity and work have positive effects on health. In fact 68 per cent expect to work longer than the traditional retirement age to maintain their lifestyle.

On legacy planning, 51 per cent plan to give more away while they are still alive. Over half plan to give more to their grandchildren than their children, believing that it will be more useful at their stage of life.

On investments, Singapore's high net worth individuals picked healthcare as their top choice for long term investment opportunities. Equities and real estate were also favoured, but so was cash, which was picked by 40 per cent of respondents. In Asia cash was favoured by 52 per cent.


  1. CW,

    You funny.

    How is it "cham" for those who reach FIRE around their 30s if they live till 100?

    You mean someone who is not FIRE at 60 will be better if they got "blessed" with long life?

    My take away from the article:

    1) Land owner and shepherds see the balance 20% as dollar signs. Look! They not wearing shoes. We can sell shoes to them! If not how I become FIRE myself?

    2) High net worth see CASH as an asset. Those starting to climb the mountain see cash as "rotting" in bank ;)

    3) Agree if we stop "working" we die fast. Of course we must define "work" here. Just look at lao lee, Li Ka-Shing, George Soros, Warren Buffett, etc.

    You and I are "working" too ;)

    Same for temperament.

    Imagine wake up have no purpose or clue what to do for the rest of the day! Dementia will eat into us soon!

    1. Pretty tough Maths to work out the number for 50 to 60 years of inflation and especially medical care and medical insurance premiums inflation.

    2. CW,

      Ah! That's what you meant ;)

      That's the reason why most will say say only about "FIRE". When the time comes, they will follow big daddy and move their goal posts!

      Its more psychological or philosophical than about money.

      If we have a mindset of lack, even if we have millions, we'll always seek to accumulate more to fill the hole in our hearts...

      To some, like the Freegans - what inflation worries when things are "free"?

      But there's one loop hole. You can't "scavenge" unused medical services...

    3. Hmm, govt will be very concerned if too many people really FIRE or go freegan in their 30s or 40s. Elites (those top 5%) will also be concerned becoz hamster wheels will stop spinning & productivity will drop! LOL!!

      But SMOL as you've said, most cannot change mindset & will retire only when forced to.

      The irony is that for a small portion of people to FIRE, we need the majority to either don't believe in that or unable to achieve it!

    4. Too many freegans then no more consumption economy. Freegans eat grass?

    5. They will become farmers, fishermen or hunters (hopefully not the robber kind). :)

      This is what happen in countries when monetary system breaks down & depression & 50% unemployment rate ... even in urban cities; rooftop / balcony / corridor / ground floor farming etc.

      Most people still enjoy consumerism, so they won't volunteer to be in this state unless big crisis. LOL!!

  2. Unlike a gift horse, it's prudent to check an advisor's mouth. LOL!!!

    They talking up their own business ... highlighting fears & bad stuff that could happen ... I'm not sure if they also moonlight as insurance salesman hahaha!!! Although I won't be surprised if bancassurance & universal life are standard tools in their box of tricks! :)

    Pretty ironic that this particular bank still do their annual polling & survey ... they've downsized/sold off their wealth mgmt by a hell lot since GFC. Have already chalked up over USD6 billions of fines since 2009 for behaving dubiously too.

  3. Fear always sells.
    It can makes us into irrational human beings.

    On the other hand without fear, can we survive and make provision for protecting our unpredictable future? How about dementia. No need to live to 100 to get it. Touch wood.

    The problem is how to structure a "Trust" that is practical and cost very little to set up and much less to maintain.

    Who to choose as Trustee or Trustees?

    Can a Church be one of the trustees?

    Still pondering how?

  4. It is the haves that have to think too much.
    If U have-not, do U still need to think?
    Yes, maybe on different things but will it be complicated at all?

    If i don't have a car, do i have to worry about the car and it's money sucking up-keeping?
    Even if it means, i can afford this "Luxury", who likes to see his money just flow out like that in exchange for convenience and saving time?

    Saving time and convenience?
    How come i see so many cars in my car park all time of the day?
    That's Singaporeans is a car loving population even though car is the most expensive in comparison to the World?

    It's beyond my understanding.
    Maybe it's a must have as a status symbol?

    If U can afford a car but U don't own one, is it a kind of under-utilize your money or U sacrifice your "entitlement" in a way?

    Now why do i own a car?


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