Why do some millionaire Singaporeans still live in HDB apartments?

A few years ago, I accompanied a friend to do door knocking. It’s the first and only time I ever did it — just for the experience. Door knocking is the activity that some insurance agents do to find customers. Other occupations that do this are ice-cream sellers, Christian evangelists, and other door-to-door salespeople. It’s extremely tiring, but the upside is that you get to meet lots of interesting people and hear their stories.

One elderly couple invited us into their flat for a cup of tea. As we conversed, we found out that they recently sold their 2-storey semi-detached house and bought this HDB flat they were now staying in. Their children had grown up and the house was too big for just the two of them. They decided to choose a central location that where public transport was easily accessible. The profits from the sale of the house were invested in bonds and stocks and they lived comfortably off the dividend income. You would never know that they are millionaire Singaporeans just by seeing them at the market.

I now stay in one of those HDB flats that have 3-room flats and studio apartments for the elderly. I wouldn’t say I’m very sociable, but I do talk to my neighbours. One neighbour used to run a business in an upscale residential area in the west where he also lived. He sold off the business and his house to move to this block because of the excellent location. He now takes about 4 holidays a year and is away for 2 months each time. Why have to maintain a big house if you’re only going to spend 4 months a year in it, he reasoned?

Another neighbour is a family of four. They used to stay in Malaysia, but recently moved in here because one child has graduated from university and is working in Singapore. The other child has started secondary school and it was more convenient for her to be living in Singapore.

Every day, there is a community of seniors who gather at the void deck to play cards, chess, listen to the radio or watch television together. Some are not well-off, that’s why they stay in the studio apartments. Some are very well-off, but they also stay in the studio apartments because it makes sense. Regardless of their financial situation, what they all gain from this arrangement is a sense of community. A sense that someone cares for them, is looking out for them, notices when they are absent.

We don’t have kampungs anymore, so HDB flats are the next nearest thing to having a community.

Downgrading often forms a part of a Singaporean’s retirement plan, but this largely depends on the property market cycle at the point of sale. It is important to regularly review your finances and your retirement plan to make sure it’s still relevant.

That’s why I advocate Holistic financial planning.

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