Are You A Sandwich-Class Singaporean?

Heard of the term sandwich class? The ‘sandwich class’ is an informal term coined to describe those in Singapore who live comfortably (not poor) but are ineligible to purchase HDB housing, and unable to afford private housing as well.

In short, it describes people in the middle income class, mostly those who occupy the 30th to 70th percentile income group in Singapore.

Due to rising costs of living, this group increasingly needs support, not just in terms of housing, but in other areas as well. For instance, those who are in the ‘sandwich generation’ also face the problem of dependency from their aging parents as well as young children.

Luckily, the government recognises this problem and has introduced various measures to help the sandwich class, especially since this year’s National Day Rally.

If you belong to this group of people, lists some measures and suggestions that can help you optimise the help rendered by the government:

1. Buying Your Own Home

One of the key measures to allow the sandwich class better access to public housing was the increase of the income ceiling limit. The household income ceiling, which currently stands at $10,000 for new HDB flats has been increased to $12,000.

A similar increase was seen for executive condominiums (EC) as well, with the new income ceiling now at $14,000. The policy changes are specifically targeted to help the sandwich class since a household income of less than $10,000 doesn’t quite qualify as a working class income.

The Special Housing Grant (SHG) has also been made easier to qualify. Previously, the SHG was only available to households with earning under $6,500, but has now been extended to those who earn under $8,500 per month.

According to Department of Statistics in Singapore, our median household income last year was at $8,292, which means that most people will qualify for the SHG.

2. Help For Childcare Expenses

Other than tackling the problem of home ownership, a big problem Singapore faces is the low fertility rate.

As it stands, we have been producing under replacement rate since 1977.

To help parents defray the costs of raising children, the government has introduced the now infamous Baby Bonus Scheme and the Child Development Account (CDA) which matches savings by the government.

In the latest update, the Baby Bonus has been increased again – an extra $2,000 for each child, and an extension of baby bonus for fifth child and beyond.

This means that the first and second child will now get an $8,000 cash gift, while subsequent babies get $10,000 each. Parents can use these money to pay for your children’s education and medical costs.

It was also announced during the 2015 National Day Rally that there will be an increase in Medisave grant for newborns, so there’s help for the increased premiums for the upcoming Medishield Life.

Other than these measures, Singaporeans can definitely help themselves by ensuring that they plan for their future with careful financial planning.

These include having enough savings, managing their household debts and also ensuring they are adequately covered by health insurance.



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