Navigating Retirement and Raising Kids

Navigating Retirement and Raising Kids

By Shawn Lee

If you’ve only got a minute:

  • As part of the “sandwich generation”, it is challenging to manage the responsibilities of providing for your kids and ageing parents. By focusing on your kids’ education first before planning for retirement, you may not have enough to retire.
  • There are many avenues to cut on your children’s expenses such as their pre-school education, enrichment classes and exploring school offerings.
  • Start small and accumulate towards retirement. You can get started easily with CPF top-ups, retirement income insurance plans and diversified investment instruments such as exchange-traded funds and unit trusts.

You are managing work, family, and money in your household. You have kids with big dreams, talents, and goals, and you want to give them the best opportunities in life. At the same time, you are navigating the responsibilities of taking care of your ageing parents. 

Finding balance amidst challenges

Your retirement plans are clear: you want financial freedom, a more relaxed lifestyle, and the flexibility to enjoy leisure or work on your terms. However, the road to retirement is not smooth sailing.

The costs of supporting your children's education and enrichment, combined with rising living expenses can feel overwhelming. Unexpected events, like parents' health issues, loss of income, or your health concerns, can strain your finances even more.


As part of the "sandwich generation", you are supporting both your parents and your children. You are worried about medical bills and the lack of retirement savings for your parents. In the past decade, you have had to handle significant expenses, from buying a house and paying down mortgage to your wedding and honeymoon. Your current level of savings may be lower than you prefer due to these financial obligations.

With your commitments, you might be thinking about focusing on your kids' education before planning for retirement. However delaying retirement planning could mean working in old age or not being able to retire at all. 

Harness compound interest: Why Start Saving Now?

Consider this: if you save $500 per month from age 35 to 65 with a 6% per year return, you will accumulate $474,349 at age 65. On the other hand, if you only start saving from age 55, and even by doubling your savings to $1,000 per month, you will only end up with $158,169 at the same 6% return at age 65. The difference could be more than $300,000!

Hence, it is crucial to begin saving for retirement while still saving for your children's education. Start early, find a balance, and make informed financial decisions that benefit both generations. Planning for retirement now sets the stage for a secure, satisfying future for you and your loved ones. The last thing you would want is to burden your children.

Tips to save on your children’s expenses

It's a juggling act, no doubt. But there are strategies to navigate this financial maze. Instead of chasing a lavish lifestyle, find a balance between enjoying the present and securing your future. Trim down on what might seem essential now so that you can invest in your future important goals. Are you struggling to find ways to save? Here are some areas you can look into now:

Pre-school education: While everyone wants to provide the best for their children, the “best” may not always be the most expensive. Fees for preschools start from $700/month and can go up to more than $2,000/month. With the current tuition fees of our local universities at about $10,000/year (or $800/month), that means some preschool fees are 3 times the cost of a bachelor’s degree! 


Enrichment classes: Next, carefully assess if extra lessons are necessary for your kids. Such classes can easily add up to hundreds of dollars each month. Some questions that can help you decide: Does your kid really need this class? Are there alternative ways to pick up this knowledge or skill? Would you be able to teach your child? Does your child need to be so proficient in this skill that a class is required?

Explore school offerings: For example, swimming is one of the key learning areas in the Physical Education syllabus. All primary schools leverage the SwimSafer programme by SportSG to equip students with basic swimming and water survival skills. Keen on your child to pick up a string instrument? Some schools offer String Ensemble as a CCA, providing an opportunity for your child to learn instruments such as the violin and cello and perform together as a group!

Start small and build towards retirement

Ready to start saving for your nest egg? Start small and increase gradually over the years. Find pockets of money to save more such as from your bonuses. When you have saved enough for your children’s education, you can channel more towards your retirement nest egg.

Before diving into investments, create an emergency fund to handle unexpected challenges. You should aim to set aside at least 3-6 months' worth of expenses to be ready for emergencies and place these funds in safer instruments such as T-bills, Singapore Savings Bonds, or Fixed Deposits. Currently, they could give you between 3% to about 4% p.a returns to help your idle money work harder for you.


Consider starting your investment journey with Exchange-traded funds (ETFs) & unit trusts. Both ETFs and unit trusts are pooled investment instruments that offer diversification through having a basket of stocks instead of individual stocks.

For example, DBS digiPortfolio is a hassle-free, ready-made investment portfolio that offers the perfect match of human expertise and robo-technology. You can get started easily from just $100. You can also withdraw your funds anytime without penalty. With all sales charges, platform fees and switching fees removed, all you pay is one small, flat management fee for the fund management team’s experience and efforts to curate and manage the portfolios. This gives you an easy way to diversify your investments and not have all your eggs in one basket. 

Alternatively, if you would like to leverage CPF's attractive guaranteed interest rates of at least 4% in your Special Account (SA), you could make a cash contribution to your SA directly via the Retirement Sum Topping Up (RSTU) scheme. By doing so, you can potentially enjoy tax relief of up to $8,000 per year too. You can withdraw your CPF funds in excess of the Full Retirement Sum (FRS) set aside at age 55 and receive your CPF LIFE payouts from age 65.

In recent years, retirement income insurance plans have been popular as they provide monthly payouts to supplement retirement cashflows for a defined period. Some start their payouts within 5 years from policy inception. There are also immediate annuities that pay out immediately.

For instance, RetireSavvy is a flexible retirement income insurance that allows you to defer your retirement age, adjust your income payout period, gives flexibility to do premium top-ups and adjust your retirement income rate (apportion part of income to be disbursed as lump sum upon retirement).

In Conclusion: Your Path to Financial Freedom

With the right strategies, a clear plan, and the drive to achieve your goals, you can build a legacy of financial stability and success for your family. 


Every choice you make today has a ripple effect on tomorrow. Act now to secure your retirement, lessen the load on your children and so you can support their dreams whether is it honing their talents or developing their passions in life. 

By balancing your financial priorities right, you can start making wise money decisions and attain your goals in future.

Start planning for retirement by viewing your cashflow projection on DBS Plan & Invest tab in digibank. See your finances 10, 20 and even 40 years ahead to see what gaps and opportunities you need to work on. Alternatively, have a quick calculation of your retirement readiness with our online retirement calculator!

You can improve the forecast by syncing your other bank and government accounts using your Singpass.

Try it now

Alternatively, you may wish to speak to a Wealth Planning Manager today for a financial health check and how you can better plan your finances.

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Disclaimers and Important Notice
This article is meant for information only and should not be relied upon as financial advice. Before making any decision to buy, sell or hold any investment or insurance product, you should seek advice from a financial adviser regarding its suitability.

All investments come with risks and you can lose money on your investment. Invest only if you understand and can monitor your investment. Diversify your investments and avoid investing a large portion of your money in a single product issuer.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

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