Why a man who earned over $88k a month had total savings of only $13k

A director of a bank drew a monthly salary of more than $88,000, but he had only about $13,000 in his savings accounts during his divorce because his high income would routinely be depleted just from paying for the expenses of his household of four.

His own monthly expenses would come to about $46,000 on average, while his former wife said she and their two children, aged 20 and 18, would need more than $30,000 every month. That meant that almost 90 per cent of his monthly salary would be spent on their expenses alone.

Although it was not disclosed why the couple had such high expenses, a large chunk of it could have been used for travelling expenses because both their children were allocated a monthly sum of about $2,000 each to spend overseas.

With such high expenses, it was not surprising that even the high-income executive would need to rely on loans to maintain such a lifestyle.

For instance, he took out two extra mortgages on his $2.9 million family home to fund their expenses, in addition to the original loan to purchase the property.

At the time of the couple’s divorce hearing in September 2025, they still owed about $380,000 for the extra mortgages and another $1 million for the main mortgage.

On top of these loans, the director also took out a $200,000 loan on his credit card, and this loan still had a balance of $95,000.

During the hearing for the dissolution of their 20-year marriage, the 49-year-old bank director drew a gross monthly income of $88,828.08, while his 54-year-old former wife, who used to be a flight attendant, is a homemaker.

She did not work during the marriage but took various professional courses to upgrade her skills, such as a one-year beauty technician course, a four-year French language studies course and a one-year nutrition course in 2022.

As it seemed odd that the bank director had such low cash savings when he earned such big bucks, it was not surprising that his former wife accused him of secretly stashing away some money.

After all, it made no sense that the highest balance in his various bank accounts was only $5,752.78.

But her allegation was dismissed by the High Court because she could not produce any evidence to show that her former husband had alternative bank accounts or was concealing his actual assets. After all, he still had substantial personal debts to clear.

The bank director then retaliated by asking for a share of his former wife’s $15,000 Rolex watch, but she argued that his gift to her should not be considered as a matrimonial asset.

Justice Choo Han Teck noted that it was obvious that estranged spouses were unlikely to give Rolex watches to each other after their marriage had fallen apart. “So when a man gives his wife a watch in happier times of the marriage, it is surely given for love,” he said.

“I think a husband who earns $88,828.08 a month should, if only to merit a measure of civility, forgo his claim for part of a watch given to his wife in such a time,” he added, noting that the watch would be excluded from the couple’s matrimonial assets even if he refused to give up his share.

Considering that the husband’s annual income exceeded $1 million, the family’s total assets were relatively modest at about $2.9 million.

The total was made up of assets in his name, which was about $1.36 million, his former wife’s assets of about $70,000 and their matrimonial home, which had a residual value of $1.5 million after deducting the three outstanding loans.

As the man was entitled to a 60 per cent share of the total assets, he would get about $1.74 million while his former wife would get about $1.16 million.

The case has highlighted three financial planning lessons that all of us should take note of.

Expenses matter more than income

Many people often focus on their income or total nest egg when they plan for retirement, but they forget to consider the more important factor: your average monthly expenses, especially after you have stopped working.

It is critically important to know how much you need monthly because this will determine whether you have planned enough for retirement.

For instance, you may have saved about $1 million, but this amount will last you only about eight years if you routinely spend $10,000 every month.

The husband in this case noted that his average monthly expenses would come up to $46,000. If he continues with such a luxurious lifestyle after his retirement at, say, age 65, he will need to have at least $10 million to pay for his expenses until 85.

The good news is that if your retirement needs are more modest and you need only up to $3,000 a month, or $6,000 a month as a couple, you can make use of CPF Life to help you pay for such expenses, for as long as you live.

The best part is you don’t even need $1 million to achieve this – those who set aside $426,000 for their Retirement Account when they hit 55 stand to receive $3,300 a month from age 65.

At this rate, you will receive a total of $396,000 by age 75, $792,000 by age 85 and $990,000 if you live up to 90. If you are blessed with longevity genes, CPF Life would have paid you a total of $1.18 million on your 95th birthday.

Overspending makes it hard to save

Most of us assume that households with over $1 million of annual income will have equally high savings, but the reality is that high-income couples who overspend are more common than you think.

In another case, the wife earned around $48,000 a month as a director in an insurance firm, while the husband pulled in about $36,000 monthly as an investment banker.

When they split, it was revealed that they had a combined cash savings of only about $300,000, with personal debts of over $140,000.

Similarly, the bank director husband in this case earned over $88,000 a month, but his monthly expenses for his household of four already came close to that. So he had to borrow more to pay for his expenses.

Hard to maintain expensive lifestyles

The bank director’s wife asked for annual child support of about $240,000, which included holiday expenses of about $40,000 for her two children.

As all her claims were not supported by evidence, the court rejected her request and did not make any order for such payments.

Instead, Justice Choo allowed the father to check with his two children, who would become young adults soon, and pay them directly what they needed.

The wife also asked for a monthly maintenance of about $13,000 but did not provide expenses to justify why she needed this sum.

As she was already receiving a share of over $1 million from the matrimonial assets, Justice Choo awarded her a lump sum maintenance of $144,000, or $3,000 a month for four years.

What this means is that if you want to claim for higher maintenance, you must know what you really need and must be able to provide the numbers to prove it.

It is almost the same as planning for retirement – if you want to have a cosy life, you must know what you need and then make sure you have enough money to pay for it.

Source: The Straits Times © SPH Media Limited. Permission required for reproduction.

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