Our parents were young adults during Singapore’s boom time, and it was a pretty great time to be alive.
Yes, they had their hardships, but they also had a lot going for them.
The country developed at a crazy rapid pace from the 70s to the early 2000s. China was still relatively undeveloped, and our neighbours weren’t as competitive yet. Bonuses were huge and fat. And property prices grew at rates that would put the STI-ETF to shame.
Which is exactly why some of their advice will be outdated today.
Let’s look at some of them.
“Stay in one job for as long as you can”
Back in the day, it was normal to stay in a job for five, ten, twenty years even. The culture then was to keep employees for as long as possible.
People only got laid-off when they fucked up big time, or when the company fucked up big time. In those circumstances, people who switched jobs every three years would be seen as untrustworthy and flaky job hoppers.
Things are way different today – staying in one job for super long might even raise some red flags.
Employers these days don’t look for loyalty, they look for people with expertise and a diverse range of skills and experiences.
(That said, even if you DID want job stability, this would be unlikely. Contract jobs are increasingly becoming the norm as companies want to go light and lean.)
“You must be successful and buy a car”
This is something a lot of my uncles repeat to me every Chinese New Year.
I think for many older Singaporeans, the mark of success is some proof of material wealth – Singapore’s prohibitively expensive car-ownership rules has resulted in this sort of strange dick measuring contest.
What makes it even sadder is that many of the boomers I personally know are having trouble retiring in 2020 precisely because they bought multiple cars in the past. And they haven’t learnt their lesson and are still spouting this nonsense to the next generation.
Well, consider this:
If they had invested $80,000 at a conservative 4.5% p.a over the 20 years instead of buying that Toyota Corolla in 2000, for example, they’d have $192,937 today.
That’s more than the CPF Basic Retirement Sum.
Make no mistake, since COE was introduced in 1990, buying a car in Singapore has always been a luxury and a bad financial decision to the average salaryman.
It’s just that the consequences can’t be seen until much, much later in your life – like 20 or 30 years later when you want to retire.
R.I.P to everyone who bought a BMW or Audi in the 2000s and are at Hong Lim Park demanding their CPF money back today.
Choices have consequences, bruh.
“Buy the biggest HDB you can afford”
This is another popular one boomers always say, and they do so because of two reasons.
The first is because they expect that you’ll be starting a huge family.
It doesn’t take a genius to see why that doesn’t make sense to the notoriously kid-averse millennial and Gen Z.
First of all, Singapore’s birth rate is negative. So statistically, it’s very unlikely you’ll be having four children and needing to buy a big $900,000 HDB in Boon Keng.
The other is capital appreciation.
Our parents lived in a time where property prices grew at a pace that makes the STI-ETF growth look like dogshit.
In those circumstances, bigger houses = bigger price = bigger capital appreciation = bigger profit when you sell. This was true for a very long time, especially for HDB flats then.
That said, the era of selling HDBs at a profit ended in the early 2010s after it was revealed that a 99-years lease didn’t mean 999 years or 100,000 years but in fact, 99 years. Sad.
The reason for not buying the biggest home you can afford? It’s very simple: you cannot expect to make money from the place you live.
Every dollar you spend unnecessarily on your house is money that could have been making more money for you on the stock market, or other investments (this includes real estate investments).
(Just to be clear, we’re not saying buy the smallest and cheapest HDB flat. Buy a place according to the space you need is all we’re asking. PLEASE. )
This doesn’t make them shitty parents.
Look, we’re sure many of your parents have your interests at heart. We really do.
Their bad advice? It’s probably the result of them drawing on their past experiences – who can blame them really? (If you took a time machine in the 1980s right now, you’d probably think like them.)
It’s also the reason why they can be so absolutely adamant they’re right. There is nothing quite as powerful as lived experiences.
Sadly, just because they feel strongly for something, doesn’t make them right. And in case you find it hard to say no to your parents, here’s something for you to think about:
Your actions will have consequences not just for yourself, but also for them – seeing how many of them will be counting on their children to retire.
Also… I mean… if they’ve indeed eaten more salt than we’ve eaten rice, wouldn’t you want to learn how to avoid hypertension?
Stay woke, salaryman.
[PS: Join our telegram group so social media algorithms won’t keep us apart.]
15 replies to “Here’s some boomer advice you need to stop following”
On hindsight I can speak for some of these boomers.
They got guts, they took risk, they trusted the govt even treated like God. Some kapoit today some made it big.
Your smartphone gen too conservative and taken over by foreingers.
You are absolutely right, millennials and Gen Z can definitely afford to be more risk-taking and more enterprising.
I believe the current generation might not be able afford to live like the previous generation even if they wanted too. Prices have gone up due to uneven and overconsumption, affordability has reduced due to high competition. Sure, societal pressure might have been higher back then (with stress on conformity), but psychological stress has gone way up. Degree based education is losing its intrinsic value. Millennials can be *expected* to buy a big house, but can they?
edit: to not too
I’m a boomer and yes I wish I atarted saving and investing sooner. I wish someone would have explained that sooner.Job security in a two year period hubby got fired from 2 high paying jobs. The second was just before he turned 62. So we crunched some numbers and punched out because a person over 50 has a hard time finding jobs. If we had known about substitute teaching sooner we would have waited on SS but we are fortunate we have SS but we have military retirement and tri care ( though not perfect not too bad. Also hubbygot 90% military disability which in IL means no property tax and his car tags are free we have some investments and savings we had 60k in savings but paid off 3ok in Bill’s to retire.
It sounds like you’ve had a lot of safety nets to depend on in order to retire. I hope you’re voting to keep those intact for future generations. Someone with such a poor ability to write would be screwed today.
The author presents an interesting take on changing economic fortunes and generational friction in Singapore. Much of this applies the the USA. Two points are particularly worth noting: (1) The huge run-up in real estate prices is largely over. Year-in, year-out, real estate in the USA tracks closely to inflation. When there is significant deviation from this trend, the market corrects, e.g. the 2008 collapse in home prices. Is real estate ownership really worth it? Maybe, but remember that, on average, the real cost of home ownership amounts to one’s mortgage payment plus 40%. Hey, you will sooner or later have to replace that HVAC unit, among other things. (2) Staying at the same job for many years was good advice in decades past. This is particularly true for those employees who were covered by a defined benefit pension plan. Sadly, those days may be over for some, perhaps for many. I worked 35 years for the same employer and now enjoy a comfortable pension. That pension was an incentive for longevity with the company. Absent that, maximizing straight salary, 401K matching, benefits, and personal savings would likely have motivated me to have changed jobs multiple times over those 35 years. Still, even in the current more volatile job market one must consider job security, benefits and other factors in addition to purely monetary concerns.
Very insightful reply Rick. Very interesting to find that what is happening in Singapore is also relatable to the states as well, despite the socio-political-economic differences! Thanks for your comment.
This is all soldi advice. Most people make the mistake of buying too much or buying too much car. Neither are needed. I used to think that I should stay at my job for years but that’s not realistic in this day and age.
$192k is more than the Full Retirement Sum, not Basic 🙂
Thanks for the post!