Singapore’s long-standing reputation for financial discipline is being tested. Rising living costs, coupled with a stronger focus on lifestyle experiences and self-care, are making it harder for many to prioritise long-term savings.

A 2025 study by payroll company ADP found that during 2024 60% of workers in Singapore lived paycheck to paycheck, a higher number than in China, South Korea, Japan, and Indonesia, and well above the Asia-Pacific average of 48%.

By comparison, the RinggitPlus Malaysian Financial Literacy Survey (RMFLS) 2024 found that 53% of Malaysians spend exactly or more than they earn each month. While slightly lower than Singapore’s figure, it shows that the challenge of stretching monthly income is a shared regional trend.

Daily Expenses Outpacing Savings

For 31-year-old Singaporean Jovan Yeo, a digital banking services employee, monthly pay is quickly allocated to credit card bills, parental allowances, insurance, and investments. The rest goes to travel, dining, and fitness memberships.

“After all these, my salary is back to zero again, with nothing much to save,” he said to CNBC. “I can save if I don’t go out, but I want to experience life too.”

In Malaysia, RMFLS 2024 revealed that only 33% of respondents save more than RM500 a month, while just 14% save more than RM1,000. Many Malaysians also face the same dilemma of balancing a budget  with quality-of-life spending.

Inflation, Housing, and Structural Costs

Maybank Research economist Brian Lee noted that despite Singapore’s inflation easing to a four-year low, the city-state remains one of the most expensive places to live due to factors such as high housing and import costs.

Numbeo’s mid-2025 Cost of Living Index ranked Singapore fifth globally at 85.3, the highest in Asia, with a year-on-year increase of 11%. Public housing resale prices rose 9.6% in 2024, nearly double the pace of 2023.

Malaysia faces similar cost pressures, although at different scales. According to RMFLS 2024, 34% of Malaysians who withdrew from their EPF Flexible Accounts did so to cope with the high cost of living, underscoring how inflation affects savings capacity.

Cultural and Generational Shifts in Spending

In Singapore, PhillipCapital wealth manager Joshua Lim observed that luxury consumption and lifestyle signalling are influencing spending habits. Expensive cars remain aspirational purchases typically financed through auto loans or hire purchase, while BNPL has grown for smaller lifestyle items.

RMFLS 2024 highlights a similar behavioural challenge in Malaysia. Many respondents acknowledge the importance of saving, yet spending on lifestyle, leisure, and convenience often takes priority.

Younger Singaporeans and Malaysians alike tend to delay aggressive saving or retirement planning. In Singapore, fewer in the middle aged group between  twenties to fifties are preparing for retirement than in 2023. In Malaysia, 40% of adults have not started financially planning for retirement, with nearly half saying they don’t know where to start.

A Regional Wake-Up Call

Both Singapore and Malaysia are grappling with modern spending habits, rising costs, and slower real wage growth.

The regional data paints a clear picture. Whether it is 60% of Singaporeans or 53% of Malaysians living paycheck to paycheck, the struggle to balance present-day lifestyle with future financial security is a common challenge.

Financial planners in both countries emphasise the same fundamentals. Building an emergency fund, cutting back on discretionary spending, and starting retirement planning early can help individuals avoid being caught short when economic conditions tighten.

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• TAGS:
• 2024 RinggitPlus Malaysian Financial Literacy Survey
• Daily Expenses
• Housing
• Rising Costs
• RMFLS
• Singapore
• Spending
• Structural Costs