In no rush at retirement? Keep your MPF in a preserved account and let it compound

With inflation running high and savings rates stuck near zero, retirees can’t live off deposit interest. If finances allow, those in no hurry to draw MPF at retirement can leave accrued benefits in a preserved account to keep compounding, withdrawing later when needed.

What are the withdrawal choices at 65?

Take it all, or leave it to grow. At the statutory withdrawal age of 65, members choose: withdraw everything, or withdraw nothing and let the full accrued benefits keep investing inside a preserved account. Preserved accounts aren’t just for job-switchers — they’re an option for retirees seeking asset growth too.

What protections do MPF investments carry?

Strict investment limits curb risk. MPF investing is tightly regulated to balance risk and return. Equity funds invest mainly in securities traded on MPFA-recognised exchanges (beyond the local market), with single-stock holdings capped at a percentage of fund assets; high-risk derivatives are restricted except for specific hedging. Bond and conservative funds face even tighter rules: bond funds may only hold bonds above a certain rating, and conservative funds must meet MPF conservative-fund requirements.

How to find cheaper funds?

Use the MPFA’s fee comparison platform. Trustees have been studying fee cuts, and the MPFA’s online platform publishes each fund’s fund expense ratio — covering management, trustee and other charges — showing total costs as a percentage of assets, so members can compare and choose.

By Lee Ping-hei, AXA Hong Kong Chief Retirement and Intermediary Sales Development Officer

To compare preserved-account fund fees, visit MPF fund comparison.