Sunday 24 July 2022

How do you feel about your current financial status? | HOW MUCH SAVINGS DO PEOPLE IN THEIR 20s HAVE?

I was scrolling through Facebook and came across this video. Watching it, we can definitely see a variety of savings habits and pattern but I would say most of the individuals in the video are doing pretty well. Most of them have achieved a 5 figure sum in their 20s which is impressive and great. One of the guy, who is a financial advisor even managed to have $140,000 both in savings and investments at the age of 26. Pretty impressive I would say.

Many of them though rated themselves pretty low in terms of how they felt they are doing compared to others their age. I think most them can rate themselves higher. Of course, the interviewees are a small sample size for people in their 20s however, I do think that many individuals in their 20s are saving pretty substantial amounts as planning for the future and the pandemic has changed a lot of spending habits.

People around me

I would say that the group of friends I hang out with are savers with them saving majority of their income currently since they do not have huge commitments at the moment like kids or mortgages. So naturally, we meet up normally not at restaurants or cafes but more like coffeeshops or hawker centres. Overall, expenditures are not high when we meet as we focus more on what we talk about.

I would say my family has also cultivated a saving mindset as we did not grow up spending much although we did have indulgences like overseas trip and also eating at restaurants during special occasions. I would say that my family uses more of a saving money method rather than investing hence the money saved were really precious and took long as well to accumulate.

I would say Singaporeans are naturally kiasu and we do save on some things and spend on others depending on individuals but most are able to save and know the importance of saving. I would say a good proportion of individuals in the video have good saving habits.

Upcoming commitments

Of course, in your early 20s, you have lesser commitments in that usually you will not have a mortgage or kids yet. However as you progress to late 20s and 30s, commitments tend to increase and your parents would age as well and if you are their retirement fund then there is a lot more financial commitments.

With the rising cost of inflation which I feel will be tough to remove due to the environment and ongoing situations in the world, it can feel stress having to plan your finances. But if you are able to start early and have a sense of how much you need and can attain over a period of time, it can ease up your stress and also have something for you to work towards.

Keep it in cash if you need the money in 3 to 5 years

Being in your 20s can mean marriage or having a BTO, if you have a big purchase coming up, make sure to always have liquidity for it to pay the bills.

Why you shouldn’t compare yourself with others, although it’s tough

It is really easy to compare and I have to say that I do that often myself but at the end, you have to align yourself to what you have and what you are doing while trying your best. No one is perfect and we chase after more especially in Singapore where work and career is a topic that is usually how people start the conversation.

As we grow older, I think it is important to be contented but also work hard and take a break when needed. Millionaires and billionaires have their own set of problems and I think as long as you are comfortable, money can always be made, focus on your health and happiness­čśâ. There are many videos that talk about how much you should have in your 20s but it only serves as a guide as you still have your 30s, 40s and 50s. Life is about experiencing and exploring!

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