SINGAPORE: Saving for retirement is supposed to be the smart move. It’s responsible and disciplined, and everyone seems to nod approvingly when you say you are “planning ahead.” Follow the rules, play it safe, and your future self will thank you. At least that is the idea.
But what happens when that future finally arrives and you realise you can no longer enjoy it?
Recently, one Singaporean experienced this himself. From a young age, he was laser-focused on working, saving, and planning for retirement.
To him, anything that didn’t directly improve his financial situation felt like a waste of time and money.
Because of that mindset, he never learned how to drive, never bought clothes he actually liked, never picked up hobbies, and didn’t put much effort into building close friendships.
On paper, his plan worked. He bought a modest four-room HDB flat, saved what he believed was enough for retirement, and made sure his three children got a proper education.
From a practical point of view, he did everything right and met all his responsibilities as a provider.
Now that he’s retired, though, he’s struggling to enjoy the things he once put off. A relative who shared his story on social media said his health has taken a serious hit.
“He can’t enjoy good food now because he suffers from high cholesterol, blood pressure, and diabetes and has to watch his diet carefully,” the relative said.
“He also can’t walk far or travel and visit places much, as he gets tired very easily and suffers from joint aches. Same with something as simple as a jog, let alone playing any sports.”
His story raises difficult but important questions. When should we stop stressing over saving every single penny?
When is it okay to splurge? And most importantly, how do we really find the balance between enjoying life now and planning responsibly for the future?
Splurging
Garrett Oakley, a certified financial planner at Betterment, along with other financial experts, says it’s perfectly okay to splurge on yourself if:
It makes you happy
If you’re certain that buying a particular item won’t impact anything else in your life and it will truly make you happy, Oakley says it’s fine to go ahead with the purchase.
It doesn’t cost more than 5 percent of your net worth
He also recommends setting clear boundaries when it comes to spending. One simple guideline is to avoid buying anything that costs more than 5 percent of your net worth.
This refers specifically to your liquid net worth, meaning the money you have in cash and investments.
For example, if you have S$100,000 in liquid assets, spending more than S$5,000 on a single item may be pushing it.
You want it for the right reasons
It’s totally fine to want nice things. But ask yourself first: do you actually love or need the item, or are you after it because you’re into the brand and want to show it off to others?
It’ll last longer than a cheaper item
If you believe a more expensive item will last significantly longer or perform better than a cheaper alternative, you should go for it.
It’s a rare occasion
Big milestones like a wedding or the birth of your first child don’t happen every day, so spending more to make them special can be worth it.
It’s a pretty good deal
It’s also okay to splurge when something you already need goes on sale and waiting means missing out on real savings. Just make sure it’s something you planned to buy anyway.
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