Parents without insurance top 50%

MORE than half (53 per cent) of Singapore parents do not have individual term life insurance.

And of those who do have financial plans for their families, 24 per cent do not have any type of life insurance included in their plans. Worse still, eight in 10 parents do not have a will.

These were the sombre results of a HSBC global study on attitudes towards retirement and financial planning, with 1,000 participants from Singapore. 17,000 people in 17 countries were surveyed for 'The Future of Retirement' report.

'We are seeing a major protection gap where many Singapore families, especially those with dependent children, are failing to recognise the benefits of life insurance protection,' noted Walter de Oude, chief executive of HSBC Insurance Singapore.

'It is really advisable to review your financial situation at major moments in life, in particular when having children and planning for their future education expenditure.'

According to the study, nearly half (48 per cent) of respondents in Singapore aged between 30 and 39 say they have no short term savings.

Of those aged between 40 and 49, 30 per cent of those married or living together are protecting their assets. 34 per cent of those aged between 50 and 59 do not have retirement plans while only 12 per cent are undertaking tax planning.

The study also found that men in Singapore exercise more control than women when making financial decisions for both retirement planning and household budgets.

32 per cent of men in Singapore are more likely to make decisions on managing the household budget compared to women (28 per cent), bucking the global trend of 34 per cent and 37 per cent respectively.

In terms of household financial decisions, 70 per cent of men in Singapore (versus a global average of 65 per cent) make all or most household financial decisions compared to 52 per cent of women in Singapore (versus a global average of 53 per cent).

'A significant finding is that across Asia, women in Singapore are least likely to be responsible for making decisions on saving for retirement, deferring to their male partners,' the study noted.

In addition, the discrepancy between the sexes in planning for retirement is consistent across all age groups, suggesting that attitudes to this aspect of the family finances are not changing over time.

In contrast, East Asian countries such as China, Taiwan, and South Korea displayed the greatest gender equality in retirement planning.

72 per cent of Singapore respondents fund their retirement via cash savings accounts while 67 per cent hold insurance in the form of endowments and investment-linked insurance.

Globally, 44 per cent of respondents said they use cash savings accounts to help fund their retirement, with 22 per cent using mutual funds and investments, and a further 11 per cent using employee stock/share schemes.