Changing Jobs? Three Ways to Handle Your MPF Preserved Account

Starting a new job means settling in — and sorting out your MPF. When you leave, your old employer’s contribution account becomes a preserved account. What should you do with it? Here are three options.

What are your three choices when changing jobs?

Move it to your new employer’s account, keep it in the old scheme, or transfer to a scheme of your choice. Option one: complete the “termination of employment statement”, the “member enrolment form”, and select “transfer to the account opened by my new employer” on the fund transfer form — merging the preserved account into the new contribution account. You’ll receive an acceptance notice within 30 days and a member certificate within 60 days. Option two: select “retain in the existing scheme” — or simply do nothing; an account with no contributions for a while automatically becomes a preserved account. Option three: pick your preferred MPF scheme and transfer the money there.

What should you watch when filling in the forms?

Your old employer must notify the trustee — and so must you. On departure, the former employer must inform the trustee of your leaving date, and you must file a termination of employment statement. If the old employer refuses, you can notify the trustee in writing yourself as proof. Holders of multiple preserved accounts must file separate forms for each — don’t skimp on the paperwork.

How do you choose wisely?

Compare fees, performance and fund choice — it’s worth the effort. With trustees in a price war, transfers are free of handling charges. Transfers take time and paperwork; you can ask an adviser to help, but you still need to file the forms yourself. Most importantly, compare fund expense ratios and returns across schemes before moving — don’t switch for switching’s sake.

To compare charges and returns across MPF funds, visit MPF fund comparison.