SINGAPORE: You’ve probably heard the advice that by 30, you should have saved around S$100,000. But what about when you hit 40? How much should you have put aside to feel financially secure?
A Singaporean recently brought up this question online, saying, “In light of all these retrenchments happening in a difficult job market, what level of savings or net worth should one have in order to not feel scared of losing jobs, heck care about office politics and not care so much about what your bosses say? ”
Responses varied in the comments section, but the majority suggested that having at least S$500,000 would provide a solid financial cushion.
One commented, “S$500k in investments and liquid assets.” Another said, “I would say S$1 million if you are married with kids. If single, maybe S$500k-800k and living with parents at least.”
Some, however, argued that the ideal amount depends on personal circumstances, lifestyle, and long-term goals. One Redditor said that for him, having an emergency fund equal to two years’ worth of expenses would provide true peace of mind.
“I know conventional wisdom is six months, but you asked about a personal feeling of security. That’s how much for me,” he explained. “Look at your monthly expenses and consider the worst-case scenario—how long will it take you to find another job with the same or a higher salary?”
Another had a different take, saying that financial security, for him, simply meant having enough “passive income to cover [my] expenses”.
Financial experts: Save three times your annual salary by 40
In 2024, OMY Singapore conducted an in-depth analysis to determine how much savings Singaporeans ideally have at different stages of life. They looked at data from the Singapore Department of Statistics, which showed that from 2013 to 2023, people saved an average of 34.1% of their income each year.
Going by this trend, OMY Singapore estimated that if someone earning a median salary continued saving at the same rate, they could accumulate around $115,934 by age 30, $297,061 by 40, and $377,821 by age 44.
However, the report emphasised that these figures should only be viewed as guidelines rather than strict benchmarks. There is no one-size-fits-all savings target, as financial circumstances vary from person to person. Unexpected expenses, life changes, and shifting priorities can all impact an individual’s ability to save.
That said, if these savings figures seem hard to reach, financial experts suggest saving at least three times your annual salary by age 40 for a more secure financial future.
Featured image by Depositphotos (for illustration purposes only)