A significant portion of Singaporeans is aspiring for financial independence by midlife, according to a new report by CIMB Singapore. The study, conducted in collaboration with the Nanyang Centre for Marketing and Technology, found that 63% of respondents aged 26 to 60 aim to achieve financial freedom between the ages of 40 and 60.
Despite a growing desire to retire early, the report highlights a lack of confidence in financial planning. Although 72% of participants believe that reaching financial independence is achievable, only 43% feel confident in managing their finances to meet that goal.
The report surveyed over 500 Singapore residents and uncovered a disparity in financial confidence across age groups. Respondents under 30 displayed the most optimism, with 60% aiming to achieve financial independence before turning 40. Additionally, 54% of younger respondents expressed confidence in their financial planning skills. In contrast, confidence diminishes among older age groups. Only 39% of those aged 40 to 50, and 43% of those aged 50 to 60, feel similarly secure about managing their financial future.
Anxiety regarding financial stability also increases with age. Nearly half (47%) of Singaporeans aged 40 to 50 admitted to frequently feeling anxious about their financial future.
The report also identified several barriers hindering the path to financial independence. The high cost of living, family responsibilities, and low income were cited as the top challenges by respondents. While 71% of participants have a financial plan in place, only 48% have begun planning for retirement. Delays in retirement planning are often attributed to reliance on CPF, competing financial priorities, and a lack of financial knowledge.
Moreover, the survey revealed gaps in financial literacy. Despite insurance being one of the top three preferred tools for financial growth, alongside savings and stocks, 39% of respondents were unsure about the effectiveness of insurance as an investment vehicle.
As Singaporeans strive toward financial independence, the findings suggest that while the ambition is high, greater financial education and confidence-building will be crucial to achieving early retirement goals.
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