Are we living comfortably? Look at Median Age, Median Income, Median Rental.

Are we living comfortably? Look at Median Age, Median Income, Median Rental.

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I love reading. I love traveling and well, I love looking at numbers too. Every time I visit a country, I always look at their food prices, the typical ones and also their property prices and I could gauge a little about how well the people in the country is living. Imagine having half of your salary going to home and another 30 percent going to food and well, there’s just 20 percent left for everything else.

This is why if we like to understand if people are living comfortably, do not look at just the average income and then converting that into some other currency (Like from SGD to RM) and then laughing at the country where the currency is weaker. The fact is that average income would include the income of a senior manager and a cleaner and averaging them both tells nothing about both of their lifestyle and comfort. So, our focus is median income.

Let’s use Singapore as an example as it’s super easy to get all the necessary median numbers.

Median age, Median income and Median rental will give a better picture. Let’s look into it today.

Putting them side by side

Someone working full time at the age of 36 will be earning around S$5,500 per month and he / she could rent a 2-room HDB flat for RM2,300 in Punggol. He / she may prefer somewhere much nearer to the office / CBD but that would be a different rental. We also assume this person is still single. He / She should be able to halve the rental cost once he / she has a partner and the partner shares half of the rental.

Where is Punggol and how far is it from the CBD? Google Map has the answer. If one has a car, then it’s roughly half an hour away to the CBD district. Including walking to the car park and walking from car park to the office. Else, using the train, it’s roughly 58 minutes. Not including walking to the office yet. If include the walking to the station and from the station to the office, it’s more than an hour.

Do you love walking?

I am someone who loves walking. If I am in Hong Kong, I usually stay at Hyatt Centric in Northpoint, Hong Kong. I walk to Shau Kei Wan on the weekend just to have breakfast and then walk back to the hotel. That’s roughly 9km in total. Well, if I am in Singapore or Malaysia, I hope the walk is less than 5 minutes. Else, I may start to sweat and then it will no longer be a comfortable working day for me until after the office air-con has cooled me down. Just need to remember this fact.

Regardless of how amazing public transport is, you will have to walk, walk and walk and well, stand as well as not everyone taking the public transport will have a seat.

Income after rental?

If the person is staying with parents, then rental would be zero. If the person is staying in Punggol, then it’s S$5,500 minus S$2,300 and that will leave the person with S$3,200 for everything else. This is still a lot of money. If we assume the person eats out everyday at the local food court (lots of them in Singapore and they are usually clean and has many choices), then it’s probably S$15 per day. Just consistent typical meals, nothing special, nothing extra, no drinks of accompany the meals etc. That’s less than S$500 per month. Taking this away from the income meant that person still have S$2,700 for all other expenses.

There’s the mobile phone charges (including internet), transportation costs, other snacks beyond just the normal meals, coffee, happy hour etc etc. We will exclude the car since everyone loves the public transport in Singapore. Car ownership will be prohibitive and it will cause the person to lose a lot of their remaining income too. This includes the COE, petrol costs, parking costs, ERP costs etc. If one is just at the median pay level, better save the money instead of spending all these and making investing the remaining amount much harder. Unless of course every weekend they spend the amount in Johor Bahru.

Conclusion?

I do think someone earning a median income in Singapore should be leaving a comfortable life. As long as this person does not overspend and does not opt to have a car to show off (that he / she is better than those who could only take the MRT) and then having to lose a lot of his / her potential investment income. If this person is able to get a HDB flat, then of course, the future is brighter since the home price is usually moving up and when he / she needs to upgrade, he / she could sell that property at a higher price versus renting where even after 10 years, all the rental belongs to the home owner.

Are you also living a comfortable life? Keep earning a higher pay than just the median income, then the quality of life would improve, except if we overspend. Easy to say and hard to do, I know. All the best to all of us and no, we may not need that extra pair of jeans or shoe or even the latest handbag. Not that new car, definitely.

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