Like the economy, people’s financial goals can and do change over time. The typical working-class Singaporean of today has vastly different financial goals than their parents and older generations.
Some may still resort to borrowing from a licensed money lender but have unique financial goals. Here are four ways their financial goals are different.
Striving for early financial independence
Many young working Singaporeans are aware of the Financial Independence, Retire Early (FIRE) movement. Their aim is to build as much wealth as early as possible so they can comfortably quit their jobs as early as possible. Goals of attaining $1 million before 40 are common.
With these goals, a number of young Singaporeans are investing a significant amount of money early in their careers. Some would even hustle with side gigs alongside their full-time jobs to maximise income. Some go the extreme and sleep as little as they can so they can work more. Obviously, this is not healthy, so losing sleep to earn more money is not recommended.
The point is, many young people are not satisfied with working just their day job. They want to do something to earn more, invest, and build wealth as early as they can. They don’t want to work a job all their lives, as they are aware that financial freedom will give them the lives they dream of.
Homeownership is no longer a top priority
Buying one’s own home (whether an HDB flat or a more expensive private property) used to be a milestone in life for most Singaporeans. Young ones these days, though, have different priorities. Purchasing their own homes is not one of them.
Young Singaporeans are more keen on renting while dabbling in real estate investments. They would rather rent for a longer time and buy properties for the sake of building wealth. This way, they can later buy their dream home with the income earned from their investments.
Private health insurance is seen as critical
Back then, most people relied on Medishield as their sole provider of health insurance. Now, young Singaporeans are not taking chances. It’s not that they don’t trust Medishield, but they want to make sure that they have as much coverage as possible.
This trend can be seen through the prevalence of integrated shield plans (IPs) available today through private insurers. With an IP, plan holders are eligible for both Medishield coverage and the additional coverage provided by their insurers. The latter typically includes the cost of admission in private hospitals and A1- or B-class wards in public hospitals. Also, this coverage will give plan holders the privilege of choosing their preferred doctors.
For many young people, this additional coverage is crucial. They would set aside money for IPs to be fully prepared for health emergencies in the future.
More focus on experience-based financial goals
Many young Singaporeans build wealth not so they can buy expensive things. Some of them would still want to buy luxury cars, condos, jewellery, and the like, but these are not the most valuable to them. More than possessions, they want to buy experiences, such as travel abroad. Going on an expensive holiday in one’s dream country is a common goal. Some would even want to tour multiple countries in a short period.
While these experiences are not concrete items, young people prefer them for the memories they can make. Through these memories, experiences stay with them for life, and no one can steal those away from them. Expensive stuff, though, can be stolen and eventually break down.
Conclusion
Financial goals have shifted these days. What used to be priorities of people in the past are no longer the same in the present. Generally, people these days want financial freedom as early as they can achieve it. They are willing to delay owning a home, for instance, to invest more money and build wealth earlier.
This is not a bad thing. It just shows how people’s financial priorities have changed over the years.
