The Gen XY Lifestyle
AIA Live Better Study: Singapore Residents Focus on Savings, Investments, and Insurance Amid Economic Concerns
Singapore residents are demonstrating resilience and a proactive mindset by prioritising financial security.
According to the latest findings from the AIA Live Better Study, over 4 in 5 (83 percent) Singapore residents plan to manage their finances actively in 2025.
The study, conducted in November 2024, reveals significant differences in optimism and financial preparedness between younger and older age groups. More than half (54 percent) of 18-29-year-olds feel financially ready to face the year’s economic challenges, while only 34 percent of 40-49-year-olds share the same sentiment. Many in this older group are managing the responsibilities of caring for both children and parents.
Overall, only 47 percent of Singapore residents are optimistic about the economy. Inflation and the cost of living (50 percent) are the primary concerns, followed by job security (35 percent) and income levels (34 percent).
Despite the expectation of challenging times, the people of Singapore are showing remarkable resilience and proactiveness. This reflects a maturing society which has a better understanding and appreciation of the value of planning early and planning well for their future and that of their loved ones.
Irma Hadikusuma, Chief Marketing and Healthcare Officer at AIA Singapore
Securing Financial Resilience: Insurance and Investments
Rather than succumbing to despair, Singapore residents are adopting a positive mindset, with more than half (54 percent) emphasising long-term financial readiness over the previous year.
The top priorities for achieving financial security include savings (62 percent), a stable income (57 percent), and emergency funds (52 percent). Additionally, 48 percent of residents view insurance as a crucial element of long-term financial planning.
Looking forward, residents are preparing for economic volatility by:
- Tightening their budgets and reducing daily expenses and big-ticket purchases (59 percent).
- Building emergency funds (29 percent), planning for retirement (28 percent), and diversifying investments (27 percent).
- Increasing their spending on insurance (22 percent) and investments (27 percent).
Balancing Budgets for Rising Healthcare Expenses
Healthcare costs are a significant concern for many Singapore residents. More than half (53 percent) perceive these costs as expensive, and less than half (47 percent) feel financially prepared to manage them. Residents plan to address potential high healthcare expenses through insurance (57 percent), personal savings (56 percent), and government healthcare support (49 percent).
A Generational Gap: Financial Priorities Shift with Age
The study highlights a generational divide in financial attitudes and behaviors. Younger adults (18-29) are more optimistic (56 percent) about the economy and less concerned about inflation and the cost of living (34 percent) compared to those in their 40s. Fewer younger adults aim to be debt-free (16 percent) or plan to cut back on daily expenses (34 percent) and big-ticket purchases (35 percent).
In contrast, those in their 40s are more likely to reduce daily spending (47 percent) and big-ticket purchases (45 percent). They prioritise building savings (55 percent) and setting aside emergency funds (46 percent), while younger adults focus on upskilling (40 percent) and mental health support (40 percent).
The differing approaches reflect the stages of life each group is in, with younger adults prioritising experiences and older adults focusing on stability. Despite these differences, both generations share the common goal of securing a stable future in challenging times.
Infographic attributed to AIA Singapore.
