Planning for retirement is a crucial financial goal, especially given the high cost of living in Singapore.

As Singaporeans live longer to an estimated 82 to 85 years on average, for those who envision themselves, retiring around 60 years of age, they would need to save diligently to allow compounding returns help them to save for retirement.

Saving for retirement with the right insurance policy can help provide the financial security needed for a comfortable and independent future.

The High Cost of Retirement in Singapore

Retiring comfortably in Singapore requires considerable planning due to high living costs. According to the CPF Board and other financial experts, retirement expenses can range widely depending on lifestyle, with estimates suggesting that a retired couple may need $1,200 to $2,400 monthly to cover basic expenses alone. For those looking to maintain a higher standard of living, costs can rise even further.

Building Wealth through Regular Savings

A steady, disciplined approach to saving is essential for accumulating wealth over time. As the saying goes, “Little drops of water make a mighty ocean.” Setting aside money regularly can turn a small amount into a “mountain of gold” over the years, providing peace of mind and readiness for future needs.

For example, if someone begins saving at age 45 and continues for ten years, by age 55, they could see their savings grow significantly with compound interest, setting them up well for retirement.

With the right financial instruments, especially those designed for wealth accumulation, regular savings can multiply over time, creating a financial safety net that’s both sustainable and powerful.

Why Traded Insurance is Effective for Retirement Planning

Traded insurance policies, are a valuable option for those looking to enhance retirement savings. Unlike traditional whole life or endowment plans, traded insurance policies offer unique advantages, including discounts on capital and shorter times to maturity, which contribute to higher yields.

1. Discount on Capital:

When purchasing traded insurance, you often acquire the policy at a reduced rate compared to the initial premium payments made by the original owner. This discount increases the potential return on your investment, as you’re paying less than the accumulated value.

2. Fast to Maturity:

Most traded insurance policies are closer to their maturity date, offering a quicker payout than newly purchased policies. This shortens the waiting time, allowing policyholders to access funds sooner—perfect for those approaching retirement.

3. Higher Yield Potential:

With a capital discount and a short maturity period, traded insurance policies often yield better returns than traditional endowment plans purchased directly. The built-in discount translates into a greater return relative to the investment, helping build a stronger retirement fund.

Example: Retirement Savings with Traded Insurance

Consider a 45-year-old who buys a traded insurance policy. By investing in a traded endowment with ten years to maturity, they can potentially secure a higher return than a new policy due to the initial capital discount. By age 55, they could have a lump sum ready for retirement, with increased value driven by compounded returns.

Assuming a returns of 4% compounded over 10 years… the returns on $100,000 would become $148,000 ( 48% simple interest)

This is the power of compounding at 4% yearly for 10 years.

How to Choose the Right Traded Insurance Policy for Retirement

Selecting the best-traded insurance plan for retirement requires an understanding of your specific goals and timelines.

To find the right match, consider consulting one of our financial advisors. Our advisors can help you navigate the available options, answer any questions, and ensure that your policy aligns with your long-term retirement objectives. To arrange a meet up, do click on the right Whatsapp button or send a email to info@conservationcapital.com.sg for a dialogue.

Alternatively, to see our list of policies online, you could click on the button below to see our Investment List.