Expats Under-saving

Expatriates are under-saving and there is a significant and growing protection gap. Peter shares his views within a Singapore context.

By Peter Huber, CEO, Zurich Global Life


For many, life as an expatriate is a great opportunity to experience working in new cultures, with diverse teams and, of course, travel to different countries. Depending on your stage in life, it can also be an opportunity to build up savings and nurture your nest eggs and it makes most sense financially for those in their younger years to start building protection cover early.


As expats, the level of international mobility we enjoy in both our working and personal lives is, of course, a huge lifestyle benefit, and a natural outcome of the increasingly globalised world in which we operate. While we have more potential to save and better protect ourselves from future uncertainties, through our presumably higher disposable income, mobility brings important considerations for how we do this, given changing domiciles, different currencies and general uncertainty over future plans.


However, there are numerous surveys around that illustrate the extent to which we as expats, together with the broader population, are under-saving, and how there is a significant and growing protection gap. There are many reasons behind this, including the fact that Singapore is officially one of the most expensive cities in the world, the great temptations of frequent regional travel as well as the danger that these key periods of our lives when we should be building protection are overshadowed by a sense of transience.


As an expatriate living in Singapore, I have first-hand understanding of the complexities of financial and protection planning when there is uncertainty as to where you might be based in five, ten, even 15 years ahead. Indeed, there are many other unknowns that need to be factored into our approach to planning, regardless of where we work such as changing financial circumstances, changes in health and life-changing family events.


Alarmingly, cancer is the main cause of death in Singapore. Just because we live our lives as expatriates does not mean we are any less at risk of diseases such as this, which curtails the lives of so many, and drastically impacts their ability to work and provide for their families. It is these risks and challenges that show us why protection is so important: so that we can protect those whom we love, limit financial insecurity and ensure that we can continue our day-to-day lives come what may.


There are many great solutions available to us here in Singapore that we can choose from to enhance our protection coverage. The Life Insurance Association and its members, including Zurich, are working relentlessly to close Singapore’s protection gap that was valued at S$462 billion in 2012, while the programmes such as MoneySense are successfully working to enhance financial literacy, and, therefore, understanding of financial planning and protection products. As expats, we should take advantage of initiatives such as these while also pushing ourselves to think more about our future life events and how to ensure we are ready for these hurdles, whichever country we are based in.