You will be able to plan ways to keep building savings in the non-earning partner's own name.
Picture Siew Ling, who stopped work after her second child. The hardest moment of her first year at home had nothing to do with nappies. It was asking her husband for money to buy his own birthday present. He never said no, and he never asked what it was for. She still hated asking, because for eleven years she had paid her own way, and now even a gift for him came out of his account.
Her story points to the two problems this lesson deals with. One is about dignity and day-to-day freedom. The other is about money that should be growing quietly in the non-earning partner's own name, and usually is not.
In lesson 2.3 each partner kept a personal amount they could spend without explaining. When one partner stops earning, that amount should not disappear. Agree a regular sum that moves from the earner to the non-earning partner's own account each month, on the same day, by standing instruction.
The wording matters as much as the money. Treat it as their share of the household income, not an allowance they have to earn or justify. They should not have to say what it is for, and the earner should not check. If the couple used a proportional split in module 3, this is simply the same principle continued. One person's paid work and the other's unpaid work, which lesson 3.3 described, are both supporting the household, so both get money of their own.
How much is for the two of you to decide. Some couples set it equal to the earner's own personal amount. Others pick a figure that covers the non-earning partner's own phone, transport, clothes, gifts and an amount to save.
The second problem is CPF. As lesson 4.1 explained, when a partner stops earning, contributions to their CPF stop too, and their retirement savings stall.
Singapore has a way to keep putting money in. Under the CPF Retirement Sum Topping-Up scheme, you can make cash top-ups to your spouse's CPF retirement savings, as well as your own and those of certain other family members. The money goes into the account that builds their retirement income, where it earns CPF interest and later adds to their monthly payouts. Once it goes in, it stays there for retirement, so only top up money you will not need before then.
The person making the top-up may be able to claim tax relief on it, within limits set by IRAS. For top-ups to a spouse, the relief has conditions, which can include limits on the spouse's own income in the previous year. The amounts, caps and conditions are reviewed from time to time, so check the current rules on the CPF Board and IRAS websites before counting on the relief. Lesson 5.2 of this course looks at top-ups to parents, which work under the same scheme with some differences.
A top-up does not have to be large to matter. Interest compounds on what is already there, and a regular top-up keeps the non-earning partner's balance moving while their salary is paused.
The third step is ownership. In many single-income households, the savings, the investments and the insurance all sit in the earner's name. While the couple is together, that seems harmless.
It stops being harmless if the earner dies before a will or nominations are sorted out, which module 7 covers, or if the marriage ends, which module 8 covers. In either case, a partner with nothing in their own name may have no access to money for weeks or months, at exactly the moment they need it.
So keep some savings in the non-earning partner's own account, enough at least for a few months of their own costs. Keep any investments they would rely on in their name too, not only in the earner's. And check their own cover: a hospital plan in their own name, and possibly some life or critical illness cover, as lesson 4.2 suggested.
Using figures made up for the example, suppose Hui Min stops work for two years after their child is born. They agree that on the 2nd of each month, Daniel's salary account sends S$700 to Hui Min's personal account. Of that, S$400 is hers to spend and S$300 goes by standing instruction to her own savings account. Once a year, in December, Daniel makes a cash top-up to her CPF under the Retirement Sum Topping-Up scheme, after checking the current conditions for tax relief. Her hospital plan stays in her own name, paid by GIRO from her personal account.
Over a year, that is S$4,800 of personal spending and S$3,600 of her own savings, plus whatever Daniel tops up to her CPF.
When you plan your own version, decide three things together: the monthly amount, the account it lands in, and how much of it goes to the non-earning partner's own savings.
Agree a monthly amount for the non-earning partner's own savings and where it will go.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).