Singapore has historically been one of the most popular worldwide expat destinations, boasting 38% of their population as expats. It’s not hard to see the reasons why; salaries in Singapore are among the highest in the world, while the quality of life is also considered exceptional.
Medical services in Singapore
are excellent (though expensive, making insurance essential for expats), employment prospects are exceptional and the city state is generally considered very safe. Add to this the superior education available for children and it’s not difficult to see why Singapore has become so popular with expats.
However now things seem to be changing. Singapore was voted the most desirable country for expats in HSBC’s annual expatriate survey for two years running, but has recently slipped to number three in the charts. Both China and Germany now outrank it among potential expat destinations.
The major reason for this change of fortunes seems to be the currency inflation which has made Singapore the most expensive place in the world to live according to the Wordwide Cost of Living index. This is particularly surprising when it was ranked 18th in the world just a decade ago.
Now, according to locals, this inflation means that transport costs three times as much as New York. Two thirds of people are spending more on groceries than they did in the recent past and real estate is at an all-time high.
These factors all combined mean that while salaries in Singapore may be some of the highest in the world, so are the living expenses – and the distance between these two is getting smaller all the time. According to a recent study, the costs of living are making it ever harder for expats in Singapore to put money into savings.
Insurer Standard Life found that an unprecedented 47% of expats currently living in Singapore are concerned about their retirement prospects. It seems that the squeeze on their finances as a result of the increased costs of living mean that many expats living there consistently fail to put money away for the future.
Over time the problem appears to be worsening and some expats are considering relocating to an area where the gap between salaries and living expenses is more generous – and allows for more realistic savings goals.
However it’s not just the exceptional cost of living that is causing Singapore to fall from favour in many expat circles; many foreign-born citizens also find it very difficult to integrate into Singaporean society, which does not easily accept foreigners, especially those that do not speak its mother tongue.
While Singapore is still a popular expat destination it is now at least not the ‘default’ destination. Perhaps this will be a positive step, encouraging potential expats to more carefully consider the options available to them; and encouraging them to think more fully about their future – and retirement in particular.