Your Portfolio Returned 8%. How Much Can You Actually Spend?

Hitting your desired retirement pot may not give you the security you want in retirement.

When people talk about retirement, they tend to have a golden number they're working towards.

That number becomes the motivation for years of discipline: going to work, saving diligently, investing every month, watching the figure inch closer. And once they hit it, retirement should be straightforward, or at least, that's the idea.

Yet a Manulife Asia Care Survey published in June 2026 found that 78% of Singapore respondents were concerned about outliving their savings.¹

Which you might find strange, given that many people spend quite some time working out their "number". But here's the catch: how your finances will actually support your retirement spending cannot simply be boiled down to a single number. That would be way too easy, wouldn't it?

Here's what you want to take note of to avoid the anxiety that's keeping 78% of Singapore respondents up at night.

1. Many People Underestimate How Much They Actually Need

Say you estimate you'll need S$60,000 a year in retirement, and you're planning for 30 years. The instinctive maths is simple: S$60,000 × 30 = S$1.8 million. Many of us know it's not that simple, but what are we missing?

Your withdrawals need to keep up with inflation

That S$1.8 million assumes your spending stays flat at S$60,000 every year. But S$60,000 in year 30 won't buy what S$60,000 buys today. At just 3% inflation,² maintaining the same purchasing power would mean spending approximately:

• TodayS$60,000
• In 10 yearsS$80,600
• In 20 yearsS$108,400
• In 30 yearsS$145,600

Your lifestyle may not have changed, but the cost of maintaining it has. As prices rise, you need more dollars each year to afford the same things. Let's consider the humble pandan coconut bun from Swee Heng: S$1.70 in 2014, S$2.10 by 2024. It doesn't sound like much, but that's an increase of more than 23% over the decade.³ And that's just one bun, what happens when it's your groceries, utilities, transport, healthcare, all the things you'll continue paying for throughout retirement?

It may assume you'll live for less time than you actually do

The S$1.8 million may have been built on a 30-year retirement, but average life expectancy for a 65-year-old today is 86.6.⁴ And that's an average, not a ceiling. Some people may live well beyond that, and the longer you live, the longer your savings need to last. If your retirement plan is computed around an assumed end date, living beyond it means you still need to fund your lifestyle without the benefit of another pay cheque.

It doesn't account for healthcare and long-term care

This S$60,000-a-year figure is usually built around everyday, predictable lifestyle costs: housing, food, transport, the occasional holiday. A major medical event or a long-term care need doesn't show up as a lifestyle expense, but as a large, often sudden claim on capital, and it tends to arrive later in retirement, exactly when the sum has the least room left to absorb it. Of course, the risk of these large catastrophic events happening can be transferred to an insurer, but we will then have to account for these (often escalating) premiums. We have written separately about the five risks you might face in retirement.

Put these three together, and the real question isn't "Do I have S$1.8 million?" It's "Was that number calculated against the realities I'll actually face in retirement?"

For many, the gap starts here, long before investment returns or withdrawal strategies even enter the picture.

2. A Lump Sum Is Not the Same as a Secure Income Stream

Good returns do not automatically put money in your bank account, and a lump sum is not automatically a retirement plan.

While you're accumulating wealth, returns tell you whether your money is growing. But once your retirement starts, the question changes: how do you turn that wealth into income you can rely on?

"I have S$1.5 million" feels like a finish line. But the figure itself doesn't tell you how much you can safely spend, how long it will last, or whether it can provide the income you need. That's why having the number doesn't necessarily give you the security you were hoping for.

So, two people can retire with the same S$1.5 million and have very different outcomes, depending on how their money is structured, invested and drawn down.

3. Accumulating Wealth Is Different From Drawing It Down

Your portfolio's historical returns may look stellar, but they don't tell you how much to withdraw each year, when to sell, which assets to sell first, or what to do when markets fall 15% during retirement. Hence, it is very possible (and likely common) to have enough money, but no real plan for how to draw it down. The two solve different problems, and many people only ever spend time on building the portfolio.

This gap becomes most evident when markets fall. While you're accumulating, a downturn is just an unrealised loss on your statement, and you have time to stay invested and wait for a market recovery. In retirement, that same downturn is happening to the money paying for this month's groceries, with no next pay cheque coming to top it back up. "Staying invested" and "don't panic" may no longer be as easy as they sound.

And the timing matters. There is sequence-of-returns risk: two retirees can have the same portfolio and the same average returns over 25 years and yet end up with very different outcomes depending on when the poor years occur. A downturn early in retirement can be particularly damaging because you're withdrawing from the portfolio while it's falling.

But there's another layer to this: the psychology of actually sticking to the plan. It's one thing to say you'll stay invested when markets are down. It's another when you're watching your retirement savings fall by 20% and wondering whether you should stop withdrawing, sell what's left, or move everything somewhere "safer". A technically sound strategy can still fail if you abandon it when it matters most.

Knowing what to do is one thing. Being able to execute it when the pressure is on is another. And that's where having a clear plan before retirement, rather than making decisions in the middle of a downturn, becomes important.

4. Your Money Doesn't All Have to Do the Same Job

For many people, their portfolio consists of a mix of ETFs, bonds, cash, investment-linked policies and other investments, often spread across different asset classes. And while they all contribute to your overall net worth, they don't necessarily have to do the same job in retirement.

Some assets can be positioned for growth. Some can provide liquidity. Likewise, some can be structured to provide a more predictable stream of income for essential expenses, while others can be used for discretionary expenses, meaning what you can scale back or put on hold when markets are down. The idea isn't to eliminate investment risk, but to make sure you're not relying on the same pool of money to do everything. We have set out three ways to structure retirement income in more detail.

You can also think about this in terms of an income floor. Your essential expenses, like food, utilities, healthcare and transport, need to be paid regardless of whether markets had a good year or a bad one. If some of those expenses are covered by income with a guaranteed component, you're less reliant on selling investments when markets are down.

And you may already have part of that floor in place, in the form of your CPF LIFE payouts, which begin from age 65. This should be factored into your retirement income needs before deciding how much additional income you need to secure. Here is how CPF LIFE compares with retirement income plans.

So, What Does an 8% Return Actually Mean for Your Retirement?

An 8% return sounds great. But a good return on its own doesn't tell you how much you can spend, how long your money will last, or whether your essential expenses will continue to be covered when markets fall.

The goal of retirement planning isn't just to accumulate enough money. It's to turn that wealth into an income you can rely on, with a plan for the risks that come with spending it. Because no one wants to spend their retirement checking portfolio statements. You want to know that your bills are covered, your lifestyle is supported, and your money can last, whatever the markets are doing.

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1	Manulife Asia Care Survey 2026, Singapore findings. Based on 1,074 Singapore respondents, part of a wider survey of more than 9,000 adults across nine Asian markets, conducted February to March 2026. Manulife Singapore.
2	3% is used here as a conservative long-term planning assumption and is a common benchmark in Singapore retirement projections. Singapore's long-run average inflation has generally run closer to 2%, so the figures above should be read as a planning buffer rather than a forecast.
3	Havend Pte Ltd, The CPF Playbook: A Holistic Guide to Using CPF for Retirement, 2026, Chapter 2, The 5 Potential Risks Retirees Face During Retirement. Download the CPF Playbook.
4	Singapore Department of Statistics, life expectancy at age 65. Males average 84.9 years and females 88.1 years.

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