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Money Matters

Get FIRED up for financial independence and early retirement in Singapore

Ever heard of the FIRE movement? No, it’s not a total defence initiative.

The FIRE movement stands for Financial Independence, Retire Early. It’s a lifestyle movement that aims to help you achieve financial security more intensively and prioritise early retirement.

In this article, we’ll talk about what the FIRE movement is all about and whether it is the right philosophy for you!

What’s the FIRE movement and how does it work?

The FIRE movement is a lifestyle model that’s hugely popular with many bloggers and Reditters. It’s a new way of looking at how we can prepare for retirement.

So, what’s the FIRE movement really about? And why was it so popular among the Gen-Zs?

Save more, live frugally

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You might have heard of the 50/30/20 budgeting plan — about 20% of your total income is set aside for savings. This isn’t the case with the FIRE movement.

With FIRE, it takes your savings game up a few notches. About 70% of your savings is set aside for early retirement. Yes, you read that right. The ultimate goal of FIRE is to achieve early retirement and ensure that it can sustain your ideal lifestyle. And FIRE proponents try to achieve that through saving more, and living frugally.

4% withdrawal rate rule

At this point, you might be wondering, “Is living on my savings really enough to sustain my retirement life?” It is possible. One of the movement’s most notable proponents is Pete Adeney, owner of a popular personal finance blog, Mr Money Moustache. He retired from his full-time software engineer job at the age of 30 by living frugally and investing the remainder of his funds.  As a FIRE proponent, he believes that if you save up enough for retirement, you can live off your savings by drawing about 4% of your funds each month.

“Why 4%?” you might be wondering. 4% isn’t just a random percentage Pete Adeney came up with. Experts referred to historical data on stock and bond returns over a 50-year period, and concluded that withdrawing 4% each month was enough to sustain one’s retirement in the US.

Although these numbers are based on US prices and costs of living, the concept still applies to achieving FIRE in Singapore. To achieve FIRE, you’ll need to save a targeted amount and withdraw a fixed rate each month to sustain your retirement life.


Living frugally might appeal to some, but not all. That is why the FIRE community is split into 2 main branches, LeanFIRE and FatFIRE. What’s the difference?

LeanFIRE proponents build up large amounts of savings and choose to live modestly. On the other hand, FatFIRE proponents tend to have a bigger budget. Instead of having an aggressive savings plan, they accumulate wealth through investing to sustain their retirement life without cutting back on spending drastically.

The FIRE movement may have originated with high savings and low spending philosophies. However, there’s really no hard and fast rule on how you should achieve FIRE.  Whether you prefer to save more or invest more, it doesn’t really matter which route you choose as long as you gain financial independence and you’re able to retire early.

Why do you want to achieve FIRE?

Before you commit to working out a plan to achieve FIRE, it is important to ask yourself why you desire FIRE in the first place.

Here are some questions you can ask yourself:

  • What does financial independence look like to you?
  • Are you choosing FIRE because you’re feeling burnt out from your job?
  • Why do you want to retire early and what will you be doing during your retirement years?

For some, financial independence means having enough savings to start a business or to take another financial risk. For others, financial independence could mean moonlighting or having a part time job. Many might even feel that it could mean the ability to stop working altogether in order to pursue a passion. Having a clear WHY is important. FIRE or not, you would want to have a clear picture of how your time will be spent during your retirement years.

If your main reason in pursuing FIRE is due to being burnt out from your job, or a lack of job satisfaction, perhaps you could consider taking a gap year or you could look out for jobs that are a better fit for you. FIRE might not be exactly what you want to pursue.

Can the FIRE movement work in Singapore?

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The short answer is yes. Despite the high cost of living and high prices in housing, FIRE can work in Singapore.

Here’s why:

1. CPF funds

You can think of CPF funds as a kind of forced savings for your retirement. Each month, both you and your employer contribute a significant portion of your income to CPF i.e. you contribute 20%, while your employer contributes 17%1.  You may not realise it, but over time, you will start to see the fruits of your CPF account. What’s more, your CPF also earns a pretty attractive interest rate — at a minimum of 2.5% p.a1. That’s higher than most savings accounts in the market and it definitely beats inflation rates.

Through setting aside significant portions of your income and an interest rate that beats inflation, the CPF system in Singapore helps to make FIRE more achievable.

2. Higher savings rate in Singapore

In the US, on average, savings accounts offer an interest rate of up to 0.09% per annum, and only a handful offer up to 0.80%. In Singapore, we have savings accounts with much higher interest rates. The JumpStart account, for instance, has an interest rate of up to 2.5% p.a. for account balances up to S$50,000, all year round. That’s almost a hundred times more than the interest rate of an average savings account you get in the US! If attaining FIRE is possible in the US despite low interest rates, then achieving FIRE in Singapore is likely as well.

3. Lower tax rates in Singapore

Another reason why the FIRE movement could work here is because of the relatively low tax rates. Whether your earnings come from your salary or investments, residents in both US and Singapore have to pay taxes. The difference, however, is that taxes in Singapore are much lower. Here, residents pay a progressive tax on personal income — this means those who earn more, pay more taxes than those who earn less. Even so, the ceiling tax rate is only 22%, which is lower compared to 37% in the US. With lower tax rates, you’ll get to channel more funds into your savings or reinvest your earnings to prepare for early retirement.

How can you get the FIRE started?

If this FIRE is one you are keen on fueling, then here are a few important things to consider:

Retirement goals

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Before you get started on a savings or investment plan, you will first need to understand what kind of retirement life you would want to have.  As mentioned, there are 2 main groups in the FIRE community — those who spend way below their means, and those who continue to live a pretty comfortable lifestyle. One group isn’t better than the other, and choosing your FIRE strategy really depends on the kind of retirement life you want to build for yourself.

If you want to maintain higher levels of spending, you would definitely need to put aside more savings for your retirement. So, how much should you save? One way to go about it is to estimate the cost of the goods and services you’ll spend on when you retire, and work out a figure that you’ll need each month.

Another factor you should consider is your desired retirement age. After estimating the amount you will spend per year for your ideal retirement life, you can do the math and calculate how much needs to be saved from now until your desired retirement age.

Here are some aspects your retirement financial plan needs to consider:

◦           Income (the amount you earn)

◦           Spending on necessities (such as telecommunications service provider bills,  transport, food)

◦           Insurance premiums

◦           Healthcare bills

◦           Discretionary spending (such as luxury items, holidays, entertainment)

◦           The amount needed to keep yourself afloat after retirement

◦           Emergency funds

Many FIRE proponents save 70% of their income. However, you can adjust that figure based on your own needs and the amount you earn. It’s okay to start small. What’s important is the intention for your financial plan.

Be in the know of retirement plans available in Singapore

There are a number of retirement plans available in Singapore to help Singaporeans live a more comfortable retirement life. The CPF Lifelong Income For The Elderly (CPF LIFE) Scheme, for instance, provides a monthly payout when you turn 65 and helps to ensure you have a guaranteed sum to live on each month. If anything, this plan goes hand-in-hand with the FIRE movement’s concept of small monthly withdrawals to sustain your retirement life.

To qualify for CPF LIFE, you would need to be a Singapore citizen or a Permanent Resident born 1958 or after. Additionally, you will need to have a minimum sum of S$60,000 in your CPF Retirement Account six months before your 65th birthday2.

Besides CPF LIFE, there are also other products in the market that can help to sustain your retirement lifestyle. Savings plans with insurance providers can help you prepare for retirement through regular savings instalments and higher interest rates. Having the right retirement products can greatly complement your own savings and investment plans!

Start investing

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This can be intimidating if you’re new to investments. But nowadays, tips and investment information are readily available. You can listen to podcasts, read blogs and take part in forum discussions on personal finance.

Additionally, you can also begin your investing journey by discussing your plans and goals with your financial advisor. With sound advice to guide you, you will be better equipped to investing your funds the most profitable way.

How do investment products help to sustain your retirement lifestyle? With a systematic withdrawal strategy, you can tap on your investments without draining your assets. For example, some stock investments or endowment plans allow you to receive regular dividend or cash payouts.

Build your savings

Researching investment strategies and retirement solutions take time. In terms of FIRE, an important step to take is to build up your savings and park them in an account with higher interest rates as soon as you can. You want to ensure that you make the most of your current funds and earn interest rates that can beat inflation, or as much of it as possible!

There’s no hard and fast rule on how you should plan for your retirement and finances. For some, staying in the workforce until their retirement age is ideal. However, if you want to gain financial independence and retire early, it can be within your reach. The first step you would need to take is to have clear financial goals for yourself, so you know the kind of retirement lifestyle you are working towards!


This article has not been prepared for any particular person or class of persons and it has been prepared without regard to the specific investment objectives, financial situation or particular needs of any person, and does not constitute and should not be construed as investment advice nor an investment recommendation. You should seek advice from a licensed or an exempt financial adviser on the suitability of a product for you, taking into account these factors before making a commitment to purchase any product. In the event that you choose not to seek advice from a licensed or an exempt financial adviser, you should carefully consider whether the product is suitable for you. Standard Chartered Bank (Singapore) Limited (the “Bank”) will not accept any responsibility or liability of any kind, with respect to the accuracy or completeness of the information herein. The Bank makes no representation or warranty of any kind, express, implied or statutory regarding this article or any information contained or referred to in this article. This article is distributed on the express understanding that, whilst the information in it is believed to be reliable, it has not been independently verified by the Bank.

Deposit Insurance Scheme:

Singapore dollar deposits of non-bank depositors are insured by the Singapore Deposit Insurance Corporation, for up to S$75,000 in aggregate per depositor per Scheme member by law. Foreign currency deposits, dual currency investments, structured deposits and other investment products are not insured. For clarity, investment products are not deposits and do not qualify as an insured deposit under the Singapore Deposit Insurance and Policy Owners’ Protection Schemes Act 2012 Rev. Ed, Cap 77B.

*Please visit for full terms and conditions of the JumpStart Account Product Terms. 


You will receive prevailing interest on your JumpStart account balances if your JumpStart account is valid and in good standing. Prevailing interest will be calculated at the end of each day and credited to your JumpStart account at the end of each month. The prevailing interest rates for your JumpStart account are as follows:

  • First S$50,000 account balance in your JumpStart account: up to 2.5% p.a. interest rate
  • Any incremental balances above S$50,000: 0.10% p.a. prevailing interest rate,

Standard Chartered may change the basis and rates of the prevailing interest at any time with prior notice.

Standard Chartered will credit any prevailing interest to your JumpStart account monthly or at other regular intervals that we determine. The prevailing interest may be credited to your JumpStart account on different dates.

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