Everyone has aspirations — it could be as simple as studying overseas, to living in a swanky penthouse.
Regardless of what your dreams are, they all have one thing in common: they cost money. With the high cost of living in Singapore, the price tags of these life milestones are also set to increase.
Here’s when financial planning comes into play. It involves defining our goals and priorities, allowing us to understand how much each goal costs so we can better budget and manage our cash flow.
With that, we deep-dived into how much each major milestone of a typical Singaporean costs so that you can have an idea of how much money you will need and start your financial planning early.
1. Getting A Degree
Since young, we have been instilled with the ritual of studying hard, doing well in exams, getting a degree and scoring a well-paid job. It almost sounds formulaic but this has been the norm for many Singaporeans.
While having a degree doesn’t necessarily mean job stability, it can help pave the way for a comfortable life.
With Singapore’s strong focus on sophisticated skill sets to drive the economy, a degree may simply serve as an added protection against competition in an increasingly globalised world.
In fact, according to data from SingStat, Singapore residents aged 25 years and above with a university education consists of 23.7 per cent of the entire local population in 2010, and that figure has increased to 31.6 per cent in 2018.
If you are thinking of getting a degree, the estimated course fees at the local universities (both public and private institutions) range between S$24,600 and S$39,600 for Singaporeans if we look at the latest numbers from the 2020 intake.
| University | Estimated Course Fee For 2020 Intake |
| National University of Singapore (NUS) | S$24,600 – S$28,800 |
| Nanyang Technological University (NTU) | S$24,600 – S$28,800 |
| Singapore Management University (SMU) | S$34,350 – S$37,950 |
| Singapore University of Technology and Design (SUTD) | S$39,600 |
| Singapore University of Social Sciences (SUSS) | S$30,000 – $33,440 (for a 4-year course) |
| Singapore Institute of Technology (SIT) | S$22,500 – S$43,080 |
| Australian Universities | S$34,135 – S$45,398 |
| Hong Kong Universities | S$21,121 – S$25,693 |
| UK Universities | S$33,186 – S$55,068 |
| US Universities | S$56,086 – S$66,134 |
These are estimations based on three-year general courses, and exclude the more expensive courses like medicine, dentistry and music.
If you are thinking of studying overseas however, the tuition fees are generally more costly and you will also have to consider accommodation and other living expenses.
At this point, you may want to consider getting an Education Loan at a low interest rate of 4.5 per cent and with flexible repayment options, whether you would like to study at a local private institution or overseas institution.
How much you would need to get a degree: At least S$25,000
2. Starting A Business
Instead of being a salaried employee, there are some Singaporeans who yearn to start their own business and be their own boss.
The basics of starting a business is to first identify a consumer pain point before coming up with a product or service that helps to resolve it and meet their needs.
Let’s say you are planning to set up an IT software startup. You may need to hire a developer to create the software, a salesperson to sell your software, and a part-time accountant for the company’s finances for a start. Depending on their work experience, salaries may work up to between S$132,000 and S$195,000 a year, using the EDB calculator.
In the first year of operation, you may be looking at renting a co-working space or hot desk (as we ease back to the ‘new normal’ of work) since the company size will be small. With the same calculator, office space costs alone will come up to between S$14,400 and S$25,200.
There are also services that are typically required when setting up a company in Singapore such as incorporation and company secretarial services, which cost from S$1,000 to S$2,000.
The total first-year expenses would come up to between S$167,100 and S$252,000. Of course, you can choose to do away with some of these costs such as opting for remote working to save on office costs, or undertake some of the paperwork yourself to reduce expenses.
This calculator from the Economic Development Board (EDB) is a helpful tool that lets you have a rough idea of what you need to consider before setting up your company.
How much you would need to start a business: Up to S$252,000
3. Getting Married
A wedding in Singapore typically costs somewhere between S$30,000 and S$50,000, though extravagant weddings can cost significantly more (i.e. more than S$100,000).
The biggest components are the wedding banquet, bridal package and honeymoon. There are also other costs to consider such as wedding rings, dowry, solemnisation and wedding photography.
Wedding banquets form the biggest bulk of the costs, averaging about S$30,000, while the bridal package can cost up to S$6,000 and the honeymoon up to S$8,000.
How much you would need to get married: S$50,000
4. Renovating A House
Buying a house is a huge investment and you may find your savings exhausted after paying for the down payment and fees.
Receiving the keys to your new home doesn’t mean that you can move in right away. You would still have to spend on renovation and furnishing before you can move in, which typically averages $46,806, unless you buy a furnished condo which can lower down the costs.
There are also maintenance costs, property taxes and other miscellaneous fees to add to the final figure.
How much you would need to renovate a house: S$48,806
5. Raising A Kid
Having a child is not just an emotional commitment; it’s a financial one as well. Parents have to provide for their children until they are old enough to care for themselves financially.
This usually amounts to about 20 years of financial responsibility for your child. What does that mean in dollars?
There is no universal standard cost for raising a child but it is possible to crunch some figures and get a rough estimate of what it would cost to have a child.
Parenting magazine SmartParents came up with a summary of the costs associated with each stage of a child’s life:
| Life Stage | How Much It Would Cost |
| Pregnancy | At least S$8,000 |
| Age 0 to 2 | At least S$60,000 |
| Age 3 to 6 | At least S$40,000 |
| Age 7 to 12 | At least S$70,000 |
| Age 13 to 16 | At least S$70,000 |
| Age 17 to 19 | At least S$16,000 (JC) or S$35,000 (poly) |
| Age 19 to 22 | At least S$40,940 (private) or S$118,000 (local university) or S$232,000 (overseas university) |
| Total | S$670,000 |
The grand total cost of raising a child in Singapore easily totals to more than half a million dollars — and that’s not even taking inflation into account.
How much you would need to raise a kid: at least S$670,000
Achieve Your Life Goals With A Personal Loan
It’s clear that the different life stages cost substantial money and you may be cash-strapped to achieve these milestones, especially when you are still in the early years of your career and have not accumulated much savings.
That doesn’t mean that it’s not possible for us to achieve these life goals. To lessen the financial burden, you can consider getting some financial help from the bank instead.
There is nothing wrong with taking a personal loan. It does not mean that you have a cash flow problem — in fact, it helps you to have better cash flow management so that you wouldn’t find your savings depleted suddenly.
Many might not know this, but the cost of borrowing via a personal loan is lower than a credit card interest charge (typically 25 per cent per annum). This means that borrowers can stand to enjoy interest savings and a higher loan balance.
The cost of taking a personal loan is also typically lower than that of an SME loan (typically 7 to 13 per cent). That said, taking a personal loan is a worthy consideration for entrepreneurs to fund their business.
Here’s a detailed breakdown of the different personal loans from OCBC Bank:
| EasiCredit | Balance Transfer | Cash-On-Instalments | ExtraCash Loan | |
| Pre-requisites | – | Must be an existing OCBC Credit Card or OCBC EasiCredit account holder | Must be an existing OCBC Credit Card or OCBC EasiCredit account holder | – |
| Income requirement | Ideal for low-income individuals as it requires a relatively low minimum annual income of S$20,000 | Minimum annual income of S$20,000 | Minimum annual income of S$20,000 | Minimum annual income of S$20,000 |
| Interest rate | 20.90% – 29.80% per annum depending on your annual income | 0% per annum (Effective interest rate from 5.20% per annum) | Interest rates starting from 4.70% per annum (Effective Interest Rate from 9.06%) | From 5.54% per annum (Effective Interest Rate from 10.96%) |
| Fees | Annual fee of S$120 (First year fee will be waived for customers with annual incomes of S$30,000 and above | A one-time processing fee of 4.5% | 1% of the approved loan amount | S$200 or 2% of the approved loan amount, whichever is higher |
| Minimum monthly repayment | Flexible repayments of 3% of outstanding amount OR S$50 (whichever is higher) | Flexible repayments of 3% or S$50 of your total outstanding balance (whichever is higher) | Fixed monthly instalments of 12 to 60 months | Fixed monthly instalments of 12 to 60 months |
If you would like to find out how much you have to repay monthly based on the amount you would like to borrow, you can use the online loan calculator which can be found on the personal loan pages. From there, you can decide which loan is ideal for you. It’s really easy and convenient!
For more information on personal loans from OCBC Bank or to apply for one, you can check out its website here.
This article was written in collaboration with OCBC Bank.
Featured Image Credit: First Cry Parenting / TWENTY20 / GettyImages / Property Guru / Patkoproperty