Hongkongers want HK$12,000 a month in retirement — but 60% are falling short: AIA survey

This article is a rewrite of a report from April 2012.

AIA Pension and Trustee’s “ideal life” survey found more than 80 per cent of respondents hoped to retire before 65, with a median ideal retirement reserve of HK$6.15 million and a target monthly living cost of HK$12,000 — yet 60 per cent had no confidence of getting there, and 61 per cent were objectively short after assessing their savings habits.

How big was the retirement gap?

The survey, conducted in January–February 2012, interviewed 1,415 working people aged 18 to 65 with MPF accounts:

What could the shortfall group do?

An AIA Pension senior executive said anyone wanting their ideal retirement life should review their retirement plan now: those serious about protecting their retirement should raise monthly savings or MPF voluntary contributions rather than leaving money in the bank. She noted MPF lost 8.4 per cent in full-year 2011 but rebounded 8.2 per cent in the first quarter of 2012, with an overall annualised return of 2 per cent — better than plain bank deposits.

What are MPF voluntary contributions?

MPF voluntary contributions are extra amounts employers or employees put into an MPF scheme on top of mandatory contributions, speeding up the build-up of retirement reserves. Around the “semi-portability” launch, many considered voluntary contributions to close the retirement gap — but members were advised to weigh their risk tolerance and cash-flow needs first.