Moderation and thrift count in retirement

Another interesting article on typical Singapore's retirees expenditures can be read at this URL...
   
To summarize, some interesting facts are:

* Retirees spend a few thousand dollars at the most each month; more typically, the amount is a moderate $1,000. Perhaps, needs are simpler when one is older. The statistics debunk a fashionable assertion that "even $1 million is not enough to retire on" or that you must target to have retirement income which is 70 per cent of your last drawn income.

* Even for the wealthiest who spend $2,000 a month, they do not need millions in the money pot - just a $600,000 blue-chip and bond portfolio giving a 4 per cent yield, for example.

* Whether future retirees can spend as little as the current batch is a question mark.

* In absolute terms, the typical retired person spends little, but is buffeted by considerable inflation.

* According to the report, individuals in typical retiree households spending $720 a month experienced a 5.3 per cent inflation rate in the last 10 years.

* CPF Life, assuming a full 2015 Minimum Sum of $161,000, provides a monthly income of about $1,300 a month for life from age 65.  But at a 5.3 per cent inflation rate, a typical retiree's spending will balloon beyond $1,300 a month after just 12 years.

* The inflation rate of 5.3 per cent is also more than what most conventional insurance instruments can match, or even what the CPF itself provides.

* On average, retiree households in four-room flats spend $1,500 a month, but get $1,230. Those in five-room flats spend $2,000 a month, but get $1,800.  Those in three-room flats, condominiums and landed properties spend less than what they get.

* Another interesting tidbit is that retirees living in three-, four- and five-room flats are earning about $200-300 a month in investment income.

* Thus, for the current batch of Singaporean retirees, the picture does not look grim by any means. They are likely to have some resources, in the form of their flat or investments. They are thrifty and do not spend much.

* Still, a large proportion of retiree households' support comes from relatives and friends not living with them, presumably their children; the social fabric is still strong.  Contributions from relatives and friends not living in the same household amount to $300-700 a month for most retiree households.