Despite a generally optimistic outlook on the economy and personal finances, a significant gap in financial preparedness persists among Singapore’s youth, particularly in insurance coverage.
According to UOB’s latest ASEAN Consumer Sentiment Study (ACSS) 2024, only 37% of Singaporeans have critical illness coverage. This percentage drops dramatically to 17% among Generation Z, highlighting a concerning trend.
The situation is even more alarming when it comes to insurance for death and total permanent disability. Only 13% of Gen Zs have this type of coverage, compared to 22% among the wider population. Disturbingly, 12% of Gen Z respondents reported having no insurance at all.
This shortfall in coverage presents a significant risk, especially as 26% of Gen Z participants failed to meet the financial planning guidelines established by the Monetary Authority of Singapore (MAS) and the financial industry’s Basic Financial Planning Guide. These guidelines emphasize the importance of emergency savings, adequate insurance, future investments, and essential legacy planning, such as wills and CPF nominations.
The study underscores the urgent need to enhance financial literacy and preparedness among Singapore’s younger demographic. Although there are positive signs, such as 55% of Gen Z and 62% of Gen Y investing at least 10% of their income, the shortfall in insurance coverage remains a critical issue.
The ACSS 2024 surveyed 5,000 individuals aged 18 to 65 across Indonesia, Malaysia, Singapore, Thailand, and Vietnam. The online survey was conducted between 14 May and 6 June 2024, in collaboration with the global management consulting firm Boston Consulting Group.
