Is the Cost of Living Really Crushing Singapore Households? A Deep Dive into 25 Years of Household Income and Expenditure Data

For many Singaporeans, the feeling that life is getting more expensive isn't just anecdotal. Rising prices, global uncertainty, and job market shifts have fuelled widespread sentiment that the cost of living is becoming unbearable. But are these feelings supported by facts? At FYT Consulting, we decided to put this assumption to the test, using 25 years of public data to understand the financial wellbeing of Singaporean households. This article brings together detailed observations from the Household Expenditure Survey and income data, offering explanations and drawing policy-relevant insights.

Singaporeans Are Earning More Than They Spend

Average Household income per month	2000	2022/23
All Households	$5,456	$11,906 (+118%)
Top 20%	$11,746	$24,943  (+112%)
Bottom 20%	$1,673	$3,107(+86%)

Average Household income per month per pax	2000	2022/23
All Households	$1,590	$4,063 (+155%)
Top 20%	$3,969	$10,102 (+155%)
Bottom 20%	$394	$920(+133%)

Between 2000 and 2023, average household incomes in Singapore more than doubled (+118%), and income per person rose by 155%. In comparison, the Consumer Price Index (CPI) rose by only 56%. Even the bottom 20% of income earners saw per capita income grow by 133%.

Interpretation: This suggests that in aggregate, household incomes have outpaced inflation. Singaporean households are, statistically, better off than two decades ago. Yet the prevailing sentiment tells a different story, especially over the past five years. The disparity likely stems from short-term shocks (COVID-19, global conflicts, inflation, AI disruptions) and psychological discomfort with lifestyle adjustments rather than long-term financial decline.

Household Expenditures Have Risen—But Mostly in Line with Incomes

Between 1998 and 2023, average monthly household expenditure rose from $3,628 to $7,119, a 96% increase. This is largely in step with income growth, suggesting that, in aggregate, households are not overextending themselves.

Table 1: Growth in Key Financial Indicators (2000 to 2023)

Metric	2000	2023	% Growth
Average Monthly Household Income	$5,456	$11,906	+118%
Average Monthly Expenditure	$3,628	$7,119	+96%
Consumer Price Index	100	156	+56%

However, a deeper dive reveals some categories have grown disproportionately:

Housing and Utilities

• Increased by 147% over 20 years.

• Key drivers: rentals (472% growth) and imputed rent for owner-occupied units (166%).

• Utility costs (electricity, water, maintenance) grew more modestly.

• Particularly impacts lower-income households, with over 30% of the bottom quintile's spending going to this category.

HOUSING & UTILITIES	2023	2003	% D over 20 years
RENTALS FOR HOUSING	211.1	36.9	472%
MAINTENANCE, REPAIR AND SECURITY OF THE DWELLING	30.2	20	51%
WATER SUPPLY AND MISCELLANEOUS SERVICES RELATING TO THE DWELLING	177.1	101.1	75%
ELECTRICITY, GAS AND OTHER FUELS	131.3	100	31%
Imputed Rental for Owner-Occupied Accommodation	1,187.7	445.9	166%

Transport

• Expenditure grew by 54%, less than overall income.

• Sharp rises in air/sea transport (428%) and goods transport (345%).

• Public transport costs rose only 17%.

• Transport remains a necessary outlay for the bottom quintile due to commuting and essential travel needs.

TRANSPORT	2023	2003	Change over 20 years
PURCHASE OF VEHICLES	396.9	268.6	48%
OPERATION OF PERSONAL TRANSPORT EQUIPMENT	280.7	182.4	54%
LAND TRANSPORT SERVICES	173.9	148.8	17%
OTHER TRANSPORT SERVICES	93.9	17.8	428%
TRANSPORT SERVICES OF GOODS	4.9	1.1	345%
TRANSPORT SERVICES AND PRODUCTS N.E.C	1	-	NA

 F&B Serving Services

• Grew by 107% overall.

• Restaurant/cafe spending increased by 290%.

• Hawker/food court spending rose by only 50%.

• 2023 marks a significant shift: the bottom quintile spent more on eating out than on groceries for the first time, possibly due to time poverty, rising raw food costs, or the normalization of hawker meals.

FOOD AND BEVERAGE SERVING SERVICES	2023	2003	Change over 20 years
RESTAURANTS, CAFES AND PUBS	403.4	103.4	290%
FAST FOOD RESTAURANTS	58.4	28.6	104%
HAWKER CENTRES, FOOD COURTS, COFFEE SHOPS, CANTEENS, KIOSKS AND STREET VENDORS	491.4	327.5	50%
OTHER CATERING SERVICES (INCLUDING VENDING MACHINES)	9.6	5.1	88%
FOOD SERVING SERVICES N.E.C	2.9	0.9	222%

Insurance and Financial Services

• Increased by 558% (insurance +543%, financial services +3800%).

INSURANCE AND FINANCIAL SERVICES	2023	2003	Change over 20 years
INSURANCE	574.4	89.3	543%
FINANCIAL SERVICES	15.6	0.4	3800%
INSURANCE AND FINANCIAL SERVICES	2023	2003	Change over 20 years

 Health

• Outpatient care grew 329% (health category overall +190%).

HEALTH	2023	2003	Change over 20 years
MEDICINES AND HEALTH PRODUCTS	66.7	33.6	99%
OUTPATIENT CARE SERVICES	293	68.3	329%
INPATIENT CARE SERVICES	100.7	52.8	91%
OTHER HEALTH SERVICES	13	8.8	48%
HEALTH PRODUCTS AND SERVICES N.E.C	0.1	-	NA

 What Happens When We Look by Income Quintiles?

Before we dive into the numbers, let’s first understand what we mean by "expenditure by quintiles."

Imagine we line up all the households in Singapore from the poorest to the richest, based on their income. Then, we divide them into five equal-sized groups—each group is called a quintile. Each quintile represents 20% of all households.

• The bottom quintile (or lowest 20%) includes the households with the lowest incomes.

• The second quintile is the next 20% up.

• The middle quintile represents the “average” or middle-income group.

• The fourth quintile is upper-middle income.

• The top quintile (or highest 20%) includes the wealthiest households.

When we talk about household expenditure by quintiles, we’re looking at how much each of these income groups spends, and on what—from housing, transport, and food, to insurance, education, or healthcare.

Why Is This Useful?

Looking at overall household spending tells us how Singapore households are doing on average, but averages can hide a lot. Spending patterns and financial pressures can vary hugely between someone in the bottom 20% and someone in the top 20%.

By comparing spending across quintiles, we can:

• See if rising costs are hurting lower-income households more than others.

• Understand whether different groups are cutting back or upgrading their lifestyles.

• Identify which categories of spending (e.g., housing or healthcare) are eating into budgets for certain segments more than others.

This helps paint a clearer and fairer picture of how the cost of living affects different Singaporeans—and in turn, can guide smarter and more targeted policies.

Diagram 1: Savings Rate by Income Quintile (2008 vs 2023)

Income Quintile	2008 Savings Rate	2023 Savings Rate
Bottom 20%	~10%	~10%
21st-40th	32%	46%
41st-60th	41%	55%
61st-80th	52%	63%
Top 20%	67%	67%

Interpretation: The middle class is doing better than assumed. But the bottom 20% remain vulnerable and may need more targeted policy support.

Additional Observations:

• The top quintile can save a substantial 67% of their income after expenses. The lowest quintile, in contrast, can only manage about 10%.

• The most encouraging trend is among the 21st–60th percentile, whose ability to save has steadily improved. The 21st–40th percentile, in particular, saw savings rise from 32% to 46%.

• While higher income households enjoy more financial flexibility, the lower quintiles allocate a disproportionate share of their limited income to essentials like housing and transport, leaving little room for anything else.

• For the bottom quintile, housing and utilities alone absorb over 30% of their expenditure, making them especially sensitive to rental and mortgage fluctuations.

• Their shift from grocery-based meals to hawker-centre dining may reflect evolving social norms, convenience, or cost-related trade-offs.

Education: Where Inequality Starts to Widen

Diagram 2: Educational Spending Differences

Table 2: Education-Related Spending Gaps

Category	Top Quintile vs Bottom Quintile (2003)	Top Quintile vs Bottom Quintile (2023)
Textbooks	+15%	+155% (small absolute quantum)
School Fees	+161%	+208%
Enrichment	+274%	+350%

Interpretation: The formal education system is equitable, but enrichment activities are market-driven and discretionary. This creates disparity in preparation and long-term opportunity.

Further Analysis:

• Textbooks are subsidised and supported by community or school programmes, reducing the gap.

• School fees differences may reflect choices of private, international or specialised schools more prevalent among high-income families.

• The real divide emerges in enrichment spending, with top quintile households spending over 3.5 times more than the lowest quintile. Despite government guidance to moderate enrichment activity, the pressure of high-stakes education and cultural emphasis on academic success drive persistent over-investment among wealthier households.

Key Observations and Policy Considerations

• Singaporean households, on average, are not overspending. Incomes have risen faster than prices.

• However, the bottom 20% are disproportionately affected by unavoidable expenditures like housing, transport, and healthcare.

• Lifestyle choices—such as increased dining out or education enrichment—reflect both cultural norms and constrained choices across income groups.

• The spending gap in education enrichment reinforces long-term inequality, which formal education cannot fully bridge.

Rethinking Policy Tools

• Current schemes like CDC vouchers (based on household), and GST/U-Save rebates (based on housing type) are helpful but broad-brushed.

• These may not efficiently target the households most in need, especially since the data shows that higher income households have the financial buffer to weather inflation.

• There is precedent for more precise targeting: the healthcare system already uses means testing.

• Given this, it is both technically and administratively feasible to direct larger quantum support to the lowest 20% income households.

Risk of Misdirected Support: If blanket support is continued for all households, we risk distorting responsible consumption behaviour and may even stoke inflation for all.

Final Thoughts

In the space of policymaking, it is crucial to distinguish noise from signal. While it is true that cost-of-living pressures have risen, especially in recent years, a data-driven view reveals a more nuanced story:

• The cost of living is not uniformly crushing—it depends on who you are.

• For the bottom 20%, support is necessary and urgent.

• For the rest, discomfort may be real, but not necessarily due to need. It becomes a policy choice: how many do we help out of necessity, and how many out of comfort or convenience?

Good policymaking must balance compassion with precision. And that begins with understanding the data.

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Learning Objectives of This Article

This article was designed to do more than present data—it was written to provoke thought, encourage reflection, and demonstrate what’s possible when public data is used well. Specifically, it aims to show that:

• Public data is a hidden goldmine – Singapore’s publicly available datasets contain rich, objective insights that remain underutilized by many public agencies.

• With the right tools and approach, data leads to better policy – Objective, data-driven analysis can shape smarter, more targeted, and equitable policies.

• Effort is required, but the returns are worth it – While data is accessible, turning it into actionable insights requires time and technical work to clean, integrate, and interpret. As this article shows, that effort pays off.

• Good analysis must be paired with good storytelling – Even the best analysis can be overlooked if it's not delivered in a concise, coherent, and compelling narrative. This article aims to be both provocative and constructive in how the story is told.

• Engagement is the most powerful tool in analytics – The ultimate value of analytics lies in inviting others to explore the data for themselves. FYT’s interactive dashboard provides that opportunity—so every reader can dig deeper, form their own conclusions, and contribute to better public dialogue. See the data for yourself here