Being sandwiched: The dilemma of filial piety on young parents

SINGAPORE — During the tumultuous Asian financial crisis in the late 90s, Mr Andrew Yeo, who was then in his late 20s, left his dream career of building ships to sell insurance, because the new job paid better.

The money was not just for himself but also to support his elderly parents through a worrisome time of massive job cuts and economic uncertainty.

“So, I chose to go into another profession for financial reasons, but my love was still with engineering and building things,” said Mr Yeo who is now NTUC Income’s chief executive.

While there are no economic crises today, young parents and youths might also be prioritising a pragmatic career over pursuing their own passions.

A poll of 400 people commissioned by NTUC Income last month found that 94 per cent of parents aged between 35 and 55 face financial pressures supporting both their growing children and their ageing parents at the same time.

Eight in 10 Singaporeans, aged 21 to 29, believed that they, too, will end up in this sandwich generation when they have children of their own.

Mr Yeo, who took on the role of Income chief in June, said the survey is part of the insurance agency’s duty as a social enterprise to spread awareness about the importance of retirement planning.

The month-long study proved that filial piety is still alive and well, because people want to support their parents in old age, he said in a chat with TODAY about generational economics and retirement adequacy at the NTUC Income Centre in Bras Basah last month.

This is despite past studies that have shown that successive cohorts of retirees are relying less on financial transfers from their children for their retirement income source, likely due to smaller family sizes today.

“No matter how developed the country gets or how the demographic changes, filial piety is still innate in us, and we will always need to question how we are taking care of our family and our elders,” Mr Yeo said.

THE DILEMMA FOR YOUNGER GENERATIONS

Yet, that sense of duty has become a dilemma for youths today, who no longer enjoy the same capital gains and clear pathways to wealth as previous generations did.

“The older baby boomer generation had built a good nest egg for themselves, by way of the Central Provident Fund or property gains, and enjoyed the booming Singapore economy for a good 20 to 30 years,” Mr Yeo said.

By comparison, the sandwich generation in their 30s to 40s reached their prime income earning years in a time of a persistent low interest rate environment and slower economic growth, he said.

“Without this environment of quite such high growth, as well as rising cost of living and higher expectations of living standards, they will not have the same ability to accumulate wealth as the baby boomers. So that is where (the effect of) the sandwich generation becomes more accentuated.”

The effect is that people who are trapped in the sandwich generation, or those who fear that they might end up in the same fate, can ill-afford to take large risks, he said.

“They desire to be more adventurous and fulfilled in their own lives, yet they have people to take care of. And even if they were to save, the interest rates seen today are not going to help them make much,” Mr Yeo said.

“So they assume more risk by investing but find themselves risk averse and a lot more passive than they thought they would be.

“This is one impact that we are beginning to observe.”

It is a sentiment that NTUC Income sought to portray in an emotive video last month, depicting a man in his 40s who had been given a good upbringing but is now hard-pressed to give his elderly parents the lifestyle and support that they wanted.

More than two million people have viewed the video, titled “The Promise — I will be the last sandwich generation”, across multiple platforms since it was released in September.

“These scenarios are real,” said Mr Yeo, adding that it has generated conversation about parental maintenance and retirement security.

When asked why the issue resonates so deeply with Singaporeans in an emotional way, he said everyone is ultimately anxious about their retirement.

“Because the future is unknown, and it is human nature to be paranoid about it. Planning for that future does help to allay some of those anxieties, but does not totally remove them.”

MORE THAN JUST GIVING MONEY

Meanwhile, the baby boomer generation had not foreseen themselves living for a long time, and their longevity has also put significant financial pressure on their retirement plans, said Mr Yeo.

“They thought they would live till 73, but now they are living until 84. That is a good 10 years more, and it is going to continue to extend even more with advances in medical science and a higher quality of life. We are also seeing more centenarians.”

These longer lifespans also mean more years being spent in poor health, which in turn requires more caregiving support, said Mr Yeo, citing his own parents as an example. His father is 75 and his mother is 68.

“My parents have chronic diseases. If I were to step into the shoes of someone else who doesn’t have a similar job as me, I will likely find it challenging to support them.”

Beyond financial support, Mr Yeo said a key aspect of retirement security is also providing emotional support and companionship to ageing parents, which is increasingly needed.

He admits that this can be tough given the pressures placed on the income-earning generations today, but said it is necessary: “We can pay for caregiving support by hiring a caregiver to play that role, but there is also a need for the physical, emotional and psychological connection that cannot be delegated away.”

One solution is to plan early, something that can only happen if people are willing to start a conversation about retirement with their family, parents and siblings.

That said, the Income CEO also finds it difficult to talk to his retired parents about whether they have enough for old age, he said with a laugh.