A client in his fifties came to see me as he was approaching retirement. By every conventional measure, he had done it.
Senior professional. Strong income for decades. A home worth around five million dollars, fully paid for. No liabilities of any kind. A respectable sum in the bank on top of that.
On paper, a multimillionaire. Anyone looking in from outside would have said he had made it, and they would have had good reason.
Then we sat down and did the retirement calculation properly, against the life he and his wife wanted to keep living.
The money they could spend would last about four years.
How that is possible
There was no mistake in his behaviour anywhere. He had paid down a substantial mortgage over many years while continuing to save a real portion of his income. Most of his CPF had gone into the house, which is exactly what it is designed for and exactly what most Singaporeans do.
The problem was not that he owned an expensive home. That home had given his family stability and a place to build a life, and it had done that job well.
The problem was that too much of his wealth was doing one job, and too little was left to do another.
Because they still had the five million dollars. They could sell, downgrade, or find some way to monetise it. But they did not want to leave. It was their home, in the neighbourhood where their life was, and the whole point of the last thirty years had been to keep it.
So for as long as they wanted to stay, that five million could not buy groceries. It could not pay a medical bill. It could not fund a holiday or a grandchild’s education or a year of care for a parent.
He was wealthy, and his options were narrow, and both of those things were true at the same time.
Two different questions
Net worth asks what everything you own is worth.
Retirement readiness asks something much narrower: how much of what you own can support the life you want, without forcing you to sell something you do not want to sell?
Most people, quite reasonably, track the first number and assume it answers the second. For most of your working life it more or less does, because during those years your income is doing the heavy lifting and your assets are just accumulating in the background.
Retirement is the moment the two separate. Your income stops. Now the only thing that matters is which of your assets can actually turn into monthly spending, and on what terms.
A house you intend to live in until you die is, for spending purposes, closer to a cost than an asset. It still needs maintenance, taxes and insurance. What it does not do is pay you.
This is not a Singaporean quirk, but it is unusually pronounced here. A recent commentary on household wealth put residential property at around 43% of household assets, against roughly 11% in shares and securities. If that broad shape describes your own balance sheet, then a large part of your net worth is committed to a job it is already doing.
The second thing that catches people
Even where there are liquid assets, there is a timing risk that plans on paper tend to ignore.
Between 2000 and 2010, the S&P 500 did not merely go sideways. Over that decade it fell about 20%. Anyone who happened to retire at the start of that stretch, and who was drawing on their portfolio to live, was selling into a falling market for years, at precisely the moment they had no income to compensate.
Markets do not know or care when you are retiring. They do not pause for your timeline.
During your working years, a bad decade is uncomfortable but survivable, because you are still adding rather than withdrawing, and time repairs it. In the first years of retirement the same decade does permanent damage, because every withdrawal locks in a loss you never get the chance to recover.
Which is why the question is not only whether the number is big enough. It is whether the plan still works if the first five years go badly.
The quiet response, and why I push back on it
When people run into this, there is a very common reaction, and it sounds responsible.
They shrink the plan.
I will cut spending by half. We will skip the travel. We will manage on less medical care. My spouse will understand.
I hear a version of this often, and I have learned to slow down when I do, because it is almost never a considered change of mind. It is fear arriving early. Afraid the real number is unrealistic. Afraid of falling short. Afraid of hoping for something and being disappointed later, so lowering the bar before life can lower it for you.
Those are not budget adjustments. They are quiet dreams being shelved, and they get shelved years before anyone checks whether they needed to be.
You would not tell your child to aim for a C so the disappointment is smaller. You would not go into work planning to underdeliver. It is worth asking why the standard drops when the subject is your own life.
What to do about it while you still can
The useful thing about finding this at fifty two rather than sixty two is that almost everything is still adjustable. Contributions, the mix of what you hold, when you draw, which assets are meant for living on and which are meant to stay. At sixty two the same conversation has far fewer moves available.
Three questions worth answering properly, on paper, with real numbers rather than a feeling:
- If your income stopped this year, how long would the money you can actually spend last, at the life you want rather than a reduced one?
- Which of your assets are available for that, and which are committed to a job you have no intention of changing?
- If the first five years of your retirement looked like 2000 to 2010, would the plan still hold?
Most people have never sat down and answered these. Not through carelessness, but because there is no natural moment that forces the question, and because the headline number looks reassuring right up until the day it has to do the work.
He was not careless. He was a careful, successful man who had done the responsible thing for thirty years and had never once been shown the difference between what he owned and what he could live on.
That difference is the whole thing. It is worth an uncomfortable afternoon to find out which side of it you are on.