Singapore Incomes and Costs of Living Rise

Food remains a significant outlay, with an average of $1,422 spent per household each month. A notable trend within this category is the pronounced preference for dining out, which constitutes nearly 68% of all food expenditure, averaging $966 monthly. This reflects a lifestyle choice where convenience and social dining are highly valued, even as households continue to frequent budget-friendly options like hawker centres and food courts for the bulk of these meals. The digital economy has also firmly embedded itself in daily life, with online spending surging to account for 11.9% of monthly household expenditure, a sharp rise from just 4.7% five years prior.

The average monthly expenditure for a young adult working full-time is approximately $1,736. The spending breakdown is led by food (27%) and necessities (25%), followed by transport and non-essentials, each at 15%. Insurance premiums make up another significant slice at 14%, underscoring a strong sense of risk management even among younger earners. When it comes to discretionary spending, or "splurges," overseas travel is the most common indulgence, followed by high-end gadgets and dining out.

This duality is further highlighted by the rapid adoption of "buy now, pay later" (BNPL) services. Over 70% of Gen Zs in Singapore have used BNPL, viewing it not as a sign of financial distress but as a savvy tool for managing cash flow. This indicates a sophisticated understanding of financial products, even as it walks a fine line with impulsive consumption. For many, the definition of a "splurge" is highly personal, ranging from a meal exceeding $100 to a significant life event purchase like a $40,000 home renovation.

Despite the pressures of a high-cost living environment, Singapore maintains a strong personal saving rate. Financial experts generally advise saving at least 20% of one's take-home pay, a goal that many younger Singaporeans seem to be internalizing. The primary motivation for this strong savings habit is the pursuit of major life goals, such as purchasing a home, funding a wedding, or ensuring a comfortable retirement. Building a substantial emergency fund, typically three to six months' worth of expenses, is also a key priority.

This disciplined approach to saving coexists with the reality of rising costs. The median monthly household income from work rose to $11,297 in 2024, a 1.4% increase in real terms after adjusting for inflation. However, this growth was slower than in the previous year, suggesting that wage increases are struggling to keep pace with price hikes.

The sources from which individuals seek financial advice are diversifying. While family and friends remain a key influence, there's a marked increase in reliance on digital sources, including social media finance influencers ("finfluencers"), local financial blogs, and news websites. This highlights the importance of discerning credible information from the vast sea of online content. Official resources like the national financial education programme MoneySense and materials provided by regulated financial institutions serve as crucial anchors for reliable advice.

​Ultimately, the key to financial well-being in Singapore lies not just in earning more, but in spending and saving smarter. This involves creating a detailed budget, distinguishing between needs and wants, and developing a long-term financial plan that aligns with personal goals like homeownership and retirement. As the economic landscape evolves, the ability to adapt, stay informed, and maintain financial discipline will be the defining factors for achieving financial security in the Lion City.