Sun Life Singapore has unveiled its second Sun Life Asia Financial Resilience Index: Balancing today's needs and tomorrow's goals, offering a detailed look into how individuals in Singapore are managing their finances while navigating today's volatile financial landscape. The findings reveal that while overall perceptions of financial security have slightly improved, the reality is more sobering – inflation has forced a shift to short-term thinking over long-term wealth.

The research surveyed over 6,000 respondents across Asia, including 1,000 in Singapore, highlights trends in financial planning, literacy, risk appetite, and the role of professional advice in building long-term resilience.

Short-term focus over long-term wealth

After several years of high inflation, many people in Singapore are struggling to manage their daily and long term expenses. According to our survey, 90% of Singapore respondents are feeling the effects of persistent price increases, and 42% note a significant impact on their ability to cover monthly expenses. Additionally, compared to a similar survey we conducted last year, the number of respondents who indicated that they have of life insurance and investment products decreased by 19% and 18% respectively.

As rising living costs continue to squeeze household budgets, more people are focused on meeting their immediate needs rather than planning for their future goals. Managing day-to-day expenses is the top financial priority for 60% of respondents, up from 43% last year, while retirement planning has dropped from second to sixth place this year – a clear sign that budgeting for the present has taken precedence over long-term goals.

In an uncertain economic environment, building emergency savings has also climbed the ranks and is now the second most important goal (41%). Achieving financial security is further challenged by a lack of long-term planning. Despite slight year-on-year improvements, long-term financial preparedness remains dangerously low. More than half of respondents (57%) still lack a plan that extends beyond 12 months. Only 8% are planning further than 10 years ahead, revealing a widespread gap in financial foresight and resilience.

Bridging the resilience divide

The survey findings also reveal a stark difference between those with high financial resilience and those without. High resilience individuals — categorised in this survey as those having high ability to withstand financial shocks and meet their financial goals – also have high financial confidence. 84% are sure they can meet short-term obligations and 77% believe they will achieve long-term savings goals.

Nearly half (49%) say they could financially support themselves for more than six months in the event of a crisis. This group is also more likely to seek professional advice, with 40% working with financial advisors. Many are taking proactive steps to improve their financial situation – 47% are reading up on personal finance and 45% are investing for stronger returns.

In contrast, only 26% of low resilience individuals – categorised in this survey as having limited ability to withstand financial shocks and limited confidence to meet financial goals – feel they can manage short- term finances, and just 12% expect to meet long-term financial goals. Alarmingly, 87% say they wouldn't be able to support themselves for more than six months in the face of job loss or serious illness. Just 27%