Dear readers, I came across something interesting from a local newspaper this morning.
According to Standard Chartered:
a) Emerging Affluent is defined as those with assets under S$150,000 and monthly personal income between S$8,000 and S$15,999
a) Established Affluent is defined as those with assets over S$150,000 and monthly personal income over S$16,000
c) High-Net-Worth: is defined as those with assets over S$1,350,000
The above definition of High-Net-Worth (HNW) individual is not new to me as this is a common definition for HNW individual: an individual with an asset of over US$1 million. (S$1,350,000 is approximately equal to US$1 million).
In Singapore, I have often heard the usual comment that this definition of HNW individual is not useful or confusing since if we are to count CPF balance or properties’ valuation which many Singaporeans have, a number of us can be considered HNW individuals but in reality, from what I have been reading, many here found themselves “asset rich but cash poor”, that is many may not hold as much liquidity or cash though they may be living in a property valued at close to or over S$1 million. But many of us cannot just sell our houses to liquidate without buying another house to stay!
As for the definition of Emerging Affluent and Established Affluent, I really believe that there is a continuum. What if someone has assets over S$150,000 and monthly personal income below S$8,000 or assets under S$150,000 and monthly personal income over S$16,000? Are they considered affluent or not? In today’s work, where many people are job hopping or may have to exit and look for jobs at times due to the volatilities of today’s economy, I would think that income as a gauge of one’s wealth may not be the most reliable as income may fluctuate.
For all the above reasons, I would think that to gauge one’s wealth, what matters most is liquidable assets! And I count Savings as the most reliable liquidable assets! Not even equities or properties which may go south in value suddenly due to a market event.
And this is what I believe All of us are to continue to work on: Save, Save and Save! Save enough to make good use of market opportunities when they arise!
To me, whether anyone call me affluent, wealthy, poor, average income is not important. What is important is that we live a balanced life, work hard, play hard, contribute to community in our own capability and leave the world slightly better than before we came.
Have a Good weekends Ahead! Continue to Stay Safe and Stay Strong!