The idea of achieving financial independence and retiring early, also known as FIRE, has gained popularity in recent years. But in high-cost Singapore, is this still a realistic goal?
At InsureXpo 2025, our editor, Timothy, spoke with Dawn, better known as SGBudgetBabe, to explore whether the average Singaporean can truly achieve FIRE. From lifestyle expectations to government policies, Dawn shares her candid thoughts on what it really takes.
Here’s an excerpt from the conversation:
Timothy: Without the option of geoarbitrage, do you think it’s realistic for the average Singaporean to FIRE?
Dawn: FIRE can be easily broken down into a stage where your passive income exceeds your lifestyle expenses. If people are willing to peel back the layers of what they are spending on and rethink their quality of life, then FIRE becomes achievable.
Of course, if someone has higher expectations, like staying in a specific place or eating at a certain standard, then they will need to work harder or wait longer. But it is still possible.
Timothy: Singapore policies seem to encourage people to be actively employed. Does that make FIRE harder for someone who is not working?
Dawn: Yes. The system rewards you for staying employed, with tax reliefs and subsidies. But if you understand the system, you can use it to your advantage. I ensure that I maximise my tax reduction as much as I can.
Thankfully, I have the Working Mom Benefit, and it also encourages me to top up my parents’ CPF. That helps me reduce my taxes and reach financial independence, or FIRE, faster. Every dollar saved in tax is a dollar I can invest.
Timothy: At Full Retirement Sum, CPF LIFE pays about half of a median Singaporean’s take-home pay. Can saving half your income, without investing, be enough to reach FIRE?
Dawn: No way. Saving alone is not enough because of inflation. The cost of living and the value of a dollar will be very different in the future. If you want to FIRE, you have to invest.
If you do not invest, you need to keep earning more. However, even then, you cannot expect to be a median earner and still achieve FIRE. That is not what the system is designed to do.
Timothy: Any last thoughts on FIRE?
Dawn: It is achievable.
“Do not be daunted by the concept of FIRE. Do not compare yourself to others. I took more than 10 years to reach my first million. Everyone’s journey is different. Start your own journey. The earlier you start, the better your chances.”
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