4 Steps to Start Saving for a Rewarding Retirement

Singapore is poised to become a super-aged society by 2030. One in four citizens, or 25 per cent of the population, will be aged 65 and above¹. Life expectancy of Singaporeans has also risen by 0.9 years in the past decade, to 83.5 years in 2024². With longer lifespans and a smaller labour force, the government has announced that the current retirement age of 63 will be raised to 64 on July 1, 2026, and eventually to 65 by the year 2030³.

Living longer means having to plan for a longer retirement. With a longer timeframe to look after, many people are rethinking about retirement means and how to ensure peace of mind in their retirement years.

Not everyone shares the same vision for retirement, which means retirement investment strategies will vary based on an individual’s unique needs and financial situation. Thinking about how you might want to spend your time in your later years can help inform your retirement goals and motivate you to start saving toward them.

Experts at T. Rowe Price, a global asset manager known for its retirement leadership, recommend these four key steps to review your existing plans and work towards achieving your retirement goals.

Step 1: Understand retirement savings tools

Before starting to save, you must first understand the retirement savings tools available. Every Singaporean would be familiar with the Central Provident Fund (CPF), where individuals and their employees contribute part of their income every month for housing, healthcare and retirement. The system has evolved over the decades to support the retirement needs of Singaporeans as people live longer.

Currently, Singaporeans over the age of 65 can receive monthly annuity payouts from CPF under the CPF LIFE scheme⁴. Individuals have the flexibility to opt for different plans, thus ensuring a steady stream of income regardless of how long they live.

Besides the mandatory CPF LIFE, other savings accounts and retirement investment solutions are also available in the market. It is worth noting that different savings accounts and investment solutions have different contribution limits, withdrawal ages and payout options. Younger investors may opt for long-term, growth-oriented investment solutions to enjoy the advantages of compound interest.

Step 2: Start saving early and gradually increase the amount

Millennials and Gen Zs are expected to live longer than previous generations due to advancements in healthcare and lifestyle improvements. Amid current market volatility, it is even more important to start retirement planning early.

For many people, personal savings are a major source of funding for retirement expenses. As a result, one of the most important steps in investing for retirement is simply to start saving what you can, as soon as you can.

Even if you can only save a small proportion of your income at the start, you should seize the opportunity to gradually increase the savings ratio as your income grows. We believe that 15% of your income should be set aside for retirement savings each year.

For those who cannot achieve the target immediately, you can take a step-by-step approach, starting with a lower ratio, and then regularly review your savings and adjust the ratio over time.

We would recommend individuals to have 11 times their ending salary saved by the time they retire to maintain their lifestyle in retirement.

To help you stay on track toward the goal of investing for retirement, compare your current savings with the savings benchmark according to your age. For instance, if you have three times your household’s current income set aside in your retirement accounts by age 45, you are considered to be on track. If your savings are less than that target, you might need to look for ways to boost your savings.

Step 3: Choose a suitable investment portfolio for retirement

In order to achieve your retirement goals, it is extremely important to consider investing in an diversified and suitable investment portfolio. Generally speaking, an investment portfolio for retirement should consider both stocks with growth potential and bonds which provide stable returns. As you age, you should gradually reduce the proportion of stocks and increase the proportion of bonds and cash assets to reduce the risk of your investment portfolio. In the current market conditions, you should pay more attention to how bond yields are trending and adjust your investment strategy in a timely manner.

Step 4: Maintain a long-term vision and fight market fluctuations

No matter how volatile the market is, maintaining discipline and patience is the key to successfully saving for retirement. Retirement planning is not something that can be achieved overnight, but a process that requires continuous review and adjustment. Follow these steps and review your progress regularly so that you can gradually work towards a rewarding retirement life.

Wenting Shen Solutions Strategist

Flexible retirement: Your future, your way

Retirement Planning When Age Is Just a Number

By Wenting Shen

¹National Population & Talent Division (2024), https://www.population.gov.sg/our-population/population-trends/longevity/

²Department of Statistics, Singapore (2024), https://www.singstat.gov.sg/-/media/files/publications/population/lifetable23-24.ashx

³Ministry of Manpower (2021), https://www.mom.gov.sg/-/media/mom/documents/press-releases/2021/1101-rraa---twg-ow-infographic.pdf

⁴Central Provident Fund Board (2025), https://www.cpf.gov.sg/service/article/what-are-the-cpf-life-plans-available-and-which-is-the-right-plan-for-me

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