Okay, we don’t mean to scare you away. But, a fact remains a fact. Singapore continues to feature among the most expensive cities in the world. Don’t believe us? As proof, we present before you the Worldwide Cost of Living 2018 Survey published by the Economist Intelligence Unit.
Does that mean living in Singapore for a common man is almost impossible? Probably not. The trick lies in managing your expenses well and cutting down on unnecessary expenses. Get yourself a good credit card that offers sweet deals throughout the year. The benefit? Higher savings, leading to a higher disposable income. In the following section, we will see what the report says.
How Does Singapore Fare According to the Worldwide Cost of Living 2018 Survey?
Here’s what the survey highlights. Singapore remains perched at the top of the list of the most expensive cities in the world. It has been occupying the top position for the last 5 years.
The report compares 160 commonly used items across 133 cities in the world. It says that the high cost of owning a car is the main reason for Singapore to earn this dubious distinction. If you have been living in Singapore for the past few years, you probably know already that purchasing a car is an expensive affair. This report validates what you already know. You might still want to know how much owning your first car in Singapore would cost you.
However, the picture is not entirely gloomy. There’s also a piece of information that might cheer you up. The report says that compared to other countries in the region, common household items are more affordable. Cost of hiring a domestic help in the country is also relatively inexpensive.
So, does that mean that those without cars will find Singapore to be a less expensive place to live in? There is probably no direct answer to this question. We’ll, however, discuss how much Singaporeans spend on various aspects of living to help you form your opinion.
But first, let’s see what the Household Expenditure Survey 2012/13 has to say about the common household expenses.
Common Monthly Household Expenses as Per the Government’s Last Survey
Before you start wondering why we’re presenting data from the 2012/2013 survey, here’s something that you should know. The survey is carried out every 5 years. The 2017/2018 report is yet to be compiled since the process of data collection is still on (as late as October 2018). Hence, we’ll be basing some of our arguments on the 2012/13 survey.
Let us first give you a quick glimpse into the key findings:
|Type of Expense||Value|
|Housing and associated expenses||S$687 (Excluding rental of properties occupied by owners)|
|Footwear and clothing||S$156|
Based on these category-wise costs, the average monthly household expenditure for 2012/2013 was found to be S$4,724. This marked a growth of 4.4% p.a. from the 2007/08 monthly expenditure value of S$3,809.
Let us now take a closer look at the expenses under every single category (average costs as per the 2012/2013 Household Expense Survey):
Housing and Related Expenses
- Your housing costs and utility bills could come up to S$424.
- The cost of maintenance/furnishing of your property and household equipment could take another S$263 out of your pocket.
Food and Beverages
- Food at hawker centres, canteens, kiosks, street vendors, and coffee shops tend to be cheaper. You could be paying S$441 per month on this.
- According to the survey, monthly expenditure on fast food could be around S$46.
- For fine-dining restaurants, pubs, and cafes, you may have to allocate S$267 every month on an average.
Transport and Travel
- For air travel, your monthly budget allocation could be around S$67.
- For private car owners, the cost could be around S$306.
- For public transport within the city, you may have to spend around S$167 a month.
Health and Medical Expenses
- Outpatient treatments could cost you around S$117 in a month.
- Medical equipment and other products could cost around S$78 a month.
Clothing and Footwear
- Your monthly clothing expenses could be around S$122.
- For shoes, you may need to spend another S$34.
Education and Related Services
- Private university education expenses could be around S$105 a month.
- For private tuition and other educational courses, you may have to pay an additional S$106 every month.
Entertainment and Recreation
- Holiday tours and packages could cost you around S$154 a month.
- If you want to partake in cultural and recreational activities, you may have to spend S$138 a month.
Mobile and Telephone (Communication)
Your monthly family expenditure on communication services could be around S$205.
Personal Care and Insurance Services
- For personal care, you could allocate around S$138 in your monthly budget.
- The cost of insurance protection on a monthly basis could be around S$294.
Lion’s Share of Income to Be Used for Housing, Food, and Transport Expenses?
Looking at the 2012/2013 government conducted survey, one would think so. The survey found that housing, food, and transport jointly account for the largest share of household expenses in a month. In fact, these 3 spend categories together accounted for 65% of the average monthly household expenses, up from 64% in 2007/2008 and 61% in 2002/2003.
It was also seen that housing expenses saw the biggest increase in absolute terms among all spend categories. Housing and related expenses shot up from S$$1,170 in 2007/2008 to S$1,730 in 2012/2013.
In 2012/2013, an average of S$4,724 was spent on consumer goods and services every month. This includes expenses such as public transport, utility bills, food, clothing, dining at restaurants, school fees, medical treatments, foreign holidays, and purchase of consumer durable products.
The report also concluded that increase in spending from the 2007/2008 period to 2012/2013 period partially reflects consumption of better products. This could also indicate an improvement in lifestyle and living conditions.
Let us now contrast this with the median income per household in the period between 2012 and 2017.
What Does Growth in Median Household Income Mean for You?
The Key Household Income Trends, 2017 report published by the Department of Statistics offered some interesting insights.
Among resident employed households in Singapore, the median household income from work in a month grew by 1.5% in real terms. In nominal terms, there was an increase of 2% from S$8,846 in 2016 to S$9,023 in 2017. Overall, between 2012 and 2017, the median monthly household income from work for resident households increased by 2.9% p.a. or by 15.5% cumulatively in absolute terms.
Another interesting observation was made in the report. After accounting for differences in household size, the median monthly household income from work per member of a household grew by 4.5% in nominal terms and 3.9% in real terms between 2016 and 2017. Overall between 2012 and 2017, the growth was 22.9% on a cumulative basis, in real terms. This translated to a growth of 4.2% p.a.
It was also seen that the households in the lowest 50% average monthly household income bracket saw a growth in their income in the range of 2.1% to 3.6%. The top 10% households saw a growth of 2.6% in real terms. Households in the 51st to 90th percentile groups recorded an income growth of 3.7% to 4.5%.
The most interesting observation in this report, however, was that household income from work on an average per household member for the lowest 50% of the households was between 4.2% p.a. to 4.6% p.a. This was higher than the growth of 2.2% p.a. to 4.2% p.a. seen by the top 50% households.
Also, if there is no earning member in your family, you may still be able to subsist on government support. Data from the same study showed that on an average, households with no income received S$4,433 per household member from the government in 2017.
Although there were some encouraging developments, experts could also sense some worrying signals. According to this Channel NewsAsia report, experts said that the fact that the growth in median monthly household income was the slowest since 2009, was a cause for worry. It meant that the government had to be more cautious in devising its economic policies and distribution of resources.
By looking at the report, you could be thinking that there was a shrinkage in the income inequality factor. However, Gini coefficient, an indicator for income inequality, had something else to say.
It remained fixed at 0.401 in 2017, unchanged from 2016. This means that income gaps between the top and the bottom sections of the society were not yet closing down. Or they were not closing down faster. The worst part is that the slowdown in average household income was recorded despite an upturn in the economy in 2017. This could mean that if you don’t have a job that pays well in Singapore, you could feel the pinch of the monthly expenses to a very large extent.
Let us now see what international students usually spend in a month.
An International Student in Singapore? Here Is How Much You Could Be Spending
Due to high living standards, top-quality education, and excellent job opportunities, Singapore is a goldmine for foreign students. However, it isn’t unreasonable to be worried about the expenses, knowing that it is one of the most expensive places to live.
According to this Singapore Management University (SMU) article, you could be spending between S$750 and S$2,000 a month on an average. This estimate doesn’t include your tuition fees and travel to and from Singapore to your home country.
Of course, the monthly expenses may differ depending on your lifestyle. Here is a list of the spend categories and probable costs:
|Expense Category||Approximate Cost Per Month|
|Accommodation||S$200 to S$700|
|Food||S$300 to S$450|
|Utility bills||S$40 to S$100|
|Personal expenses||S$100 to S$300|
|Mobile and other communication services||S$50|
|Books||S$100 per term (on an average)|
|Medical Insurance||SMU students get it for FREE. If you’re not a student of SMU, you’ll have to check with them.|
What Our Suggestions for You Are
The following suggestions might work not just for students in the tertiary education level but also for those who have recently embarked on their professional journey:
- If you travel frequently within the city, top up your EZ-Link Card for the month. You could top up between S$50 and S$70 at one go. Check out some credit cards that offer rewards for EZ-Link top-up.
- If you can’t find a students’ dormitory, look for HDB facilities where you can share a room or a flat with others. Taking a condominium on rent could be expensive. You could have to pay upwards of S$700 for such accommodations.
- Ask the agent/landlord if the rent for your accommodation includes certain utility expenses such as electricity, air conditioner top-up, and broadband among other things, or not. If there are multiple occupants (with whom you’re sharing the property and the facility), you could opt for a higher package. That way, the utility expenses could get distributed evenly.
- At university cafeterias and food courts in the city, you may be able to get a meal for approximately S$5 to S$6. That means, you could be spending around S$15 to S$18 every day on food. If you can cook your food (at least 1 meal every day), you may be able to save more in the long run.
- You may be able to find affordable and good mobile plans that charge between S$20 and S$30 per month. Shop around before you choose one.
- For entertainment and parties, you may want to keep another S$100 to S$200 separately.
- Gym membership, in general, is quite expensive. By some estimates, it could be around S$170 to S$200. If you can find a free or subsidised gym facility within your university, make use of it.
Eligible for a Part-Time Job? Use It to Defray a Portion of Your Monthly Expenses
Not all students are eligible for annual living allowances from the government. However, the Ministry of Manpower allows international students to work for up to 16 hours every week while they are studying in Singapore.
By some estimates available online, you may be able to earn between S$500 and S$800 per month. That means, you could be earning between S$8 an hour and S$13 an hour from part-time jobs. In Singapore, you could find jobs within the university premises or even outside. If you have the right skills, you could get hired by a start-up firm on a temporary basis. You could also make some money by tutoring.
Why do we suggest this? First, you could lower your cost burden and have more for discretionary spending. Second, you could use this experience to get a better job after you graduate.
Should You Be Worried About the Rising Healthcare Expenses?
According to a news article published by the Straits Times, elderly healthcare cost in Singapore could rise tenfold to S$66 billion annually by 2030. The report released by Marsh & McLennan said that the elderly in the country could need around S$51,000 a year to sustain. The report also predicted that on an average, an elderly person may have to spend approximately US$37,427 in 2030.
What does this mean for you? Avoiding medical insurances may no longer be a viable option. A good health cover can provide comprehensive protection against a range of diseases. If you can choose one with a moderately low premium but high coverage, you won’t have to worry much about your healthcare expenses even after you retire.
Average Household Spending in Singapore Likely to Grow Further
A research report by BMI Research has forecasted that the annual household spending in Singapore will grow by 6.5% p.a. until 2022. Between 2018 and 2022, the total household expenditure in the country could rise from US$124.4 billion to US$174.5 billion. This contrasts starkly against the growth rate of 2.9% p.a. recorded between 2013 and 2017.
The report has also predicted that the rise in household spending will mainly be driven by non-essential spending. Non-essential spending could be 58% of the total household expense by 2022. This could, in part, be due to a forecasted increase in net household disposable income. The average household disposable income could be US$122,300 by 2022 as against US$100,392 in 2018.
Rise in disposable income would also increase household expenditure on recreation and leisure. Recreation and culture could be growing at a rate of 8.2% p.a. and lead to a total spend of US$23.5 billion by 2022.
After reading this article, you may have formed an opinion that it’s almost impossible to support yourself in Singapore without the right means. We don’t deny that it is indeed a very expensive place to live in. But, with proper money management techniques, you could steadily build up substantial savings and enjoy a good standard of living. Moreover, the government provides a number of subsidies, be it on housing, education, or health.
Just make sure that you don’t overspend and over-leverage your debt facilities. If you can do that, you would realise sooner than later why Singapore is considered to be among the most liveable places on the planet.