August 29, 2022
SINGAPORE — Divorcee Chua Lye Tszio, 78, who lives alone in a rental apartment in Tampines and has no retirement funds, gets by on $600 a month from her four daughters.
But the amount is becoming increasingly difficult to stretch, with the core inflation rate hitting a 13-year high of 4.8% and headline inflation hitting 7% in July.
As the core inflation rate rises, Singapore’s senior citizens aged 65 and over are bearing the brunt of inflationary pressures.
According to a study by the board of directors of the Central Provident Fund (CPF), they receive a smaller cash allowance from their relatives. At the same time, rising consumer prices have pushed their spending to 96% of their income, higher than the average of 64%, according to a DBS study.
The latest pension and health study by the CPF board showed that the share of older people receiving a cash benefit from their children increased from 69% over the two-year period from 2018 to 2019 to 64% over the 2020 to 2021 period. Those with a monthly allowance got 4% less in 2020, from $500 to $480.
The council said it could reflect the economic impact of the Covid-19 pandemic, when their children cut their cash benefits.
In the survey, 12,000 to 15,000 people have been asked every two years since 2014 about their retirement and health needs.
Meanwhile, the DBS study found that people aged 58-76 have an expense-to-income ratio of 96%, compared to 64% for the average DBS customer.
“This suggests lower bandwidth among (baby boomers), including seniors, to fight inflationary pressures going forward,” senior economist Irvin Seah of DBS Group Research told the Straits Times.
“Although inflation will remain high this year, there are signs that it is near its peak, judging by the moderation in global food, energy and commodity prices over the past three months. months,” he added.
Mr Seah said that from May 2021 to May this year, spending by baby boomers on shopping increased the most, peaking at 47%, followed by spending on transportation, which rose 44%, and food expenditure, which increased by 26%.
The three main components of spending are usually food, transportation, housing and utilities, he said.
He suggested baby boomers might consider cutting back on discretionary spending, like shopping.
But some older people like Madame Chua don’t have that option – she already spends only on necessities.
Although she thinks $600 a month is hard to live with, it’s enough for her because she lives simply, she said.
“(The amount) is just nice…As long as there’s enough to eat, I don’t ask for more.”
She usually prepares simple meals of rice with eggs, sardines or beef, and spends her days at the Lions Befrienders Seniors Activity Center in her apartment building.
She sees the doctor once or twice a month for her asthma and knee pain, and her daughters foot the bill.
She told ST that she did not want to ask any of her daughters for more allowance as they have dependent children and are trying to make ends meet.
While she worries about inflation and the rising cost of living, she doesn’t see the point in worrying about it. “There’s no point in worrying,” she said.
Economics professor Eric Yeo, 34, gives his parents $600 a month.
As he gives them a fixed percentage of his income, the amount has increased over the years, but Mr. Yeo is not increasing the amount this year because he has to support his children, aged five and one.
“My parents aren’t too worried (about inflation); they’re not big spenders,” he said, adding that he has two siblings who help support his parents.
He’s also cutting spending, taking his kids to free rather than paid playgrounds and having less homemade ice cream, for example.
“But not to the point of feeling deprived,” he added. “I’m not that concerned about inflation because I think it’s short term.”
Mr Joe Tan, who leads integrated case management at Care Corner Seniors Services, said some of his clients’ children have seen their finances affected by the pandemic, in addition to having to deal with inflation and the rising cost of their parents’ health needs. Middle-income workers may not be eligible for financial support, which can increase the financial burden on their families, he added.
He said children can reduce their parent’s cash allowance when their income does not rise as prices rise. Problems arise when older people compensate for this by eating less or eating of lower quality or skipping medical appointments, he said.
Some older people delay asking for financial assistance for their children for fear of overburdening them or further straining their relationship, he added.
Lions Befrienders President Anthony Tay says the government has made jobs available for older people who want to re-enter the workforce, where job redesign, job matching and skills upgrading are offered at very low cost.
He said micro jobs with flexible hours could also benefit older people.
The Ministry of Social and Family Development (MSF) said there are sources of retirement assistance for older Singaporeans, such as the Pioneer and Merdeka Generation packages and the Silver Support Scheme. Payout amounts have been increased for the scheme since January last year to bolster support for less well-off seniors.
Those in need of assistance can call the ComCare hotline at 1800-222-0000 or approach the nearest social services office, MSF added.