HSBC MPF: A Chance to Consolidate Accounts Under Semi-Portability

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

In November 2012’s “semi-portability” era, HSBC Insurance head and employee benefits chief Chu Wing-yiu said the bank had multiple schemes ready for members looking to move their employee mandatory-contribution accruals — from the traditional “ValueChoice” and actively managed “SuperTrust”, to the age-based auto-adjusting “EasyChoice” and the passive-led “Self-Select” — four parallel lines.

What is special about the “Self-Select” scheme?

The market’s first predominantly passive MPF scheme, charging 0.79%–0.99%. “Self-Select” held multiple index-tracking and Hang Seng H-share index funds — among the market’s cheapest schemes; together with “Choice”, “Wisdom” and “Easy”, members could match options to risk appetite and life stage.

What was the personal-account discount?

HSBC was the first provider to discount personal-account members. From March 2011, the “MPF Conservative Fund”, “Global Bond Fund” and “Hang Seng Index Fund” cut management fees from 1.25%–1.5% to 0.79%–0.99%, up to 40% off; personal-account members of the “Choice”, “Wisdom” and “Easy” schemes enjoyed over 20% off — encouraging members to consolidate multiple preserved accounts into one personal account.

What did HSBC remind members before switching?

MPF is long-term — don’t move rashly on short-term swings. Chu reminded: don’t choose trustees on short-term returns and fees alone, nor switch to catch fund-price moves; trustee strength, service, financial stability and retirement-asset experience matter equally. Note the “semi-portability” limits too: the current employer’s portion can’t move, the employee portion only once per calendar year; guaranteed-fund members must check guarantee terms before transferring.

How should you deploy after switching?

Review the mix regularly, consider voluntary contributions, consolidate accounts. Chu advised: review and adjust fund choices against personal needs from time to time, consider extra personal voluntary contributions, and consolidate MPF into one personal account — thorough preparation for retirement security.