Joseph Li: Don’t Keep Switching MPF Funds — Aggressive at 20, Defensive at 55; the 3–5 Years Before Retirement Are Critical
2011-06-26
Markets wobble, paper losses appear, and members start switching funds frantically? AXA Hong Kong’s Joseph Li reminds: MPF is long-term — stay calm, and don’t treat it like short-term stock trading.
Why not switch constantly?
Price moves are only paper gains and losses. MPF is a main post-retirement income source and one of the three retirement pillars — nothing like short-term speculation. Many wrongly fixate on current fund performance and let market swings drive constant switching; MPF should never be “short-traded”.
How should strategy change with age?
| Age | Strategy |
|---|---|
| Early 20s | Can be more aggressive with a long accumulation horizon — but align with the overall retirement plan to balance risk |
| 40s | Shorter horizon, heavier family burdens — shift gradually toward balanced portfolios |
| 55, near retirement | More defensive; the 3–5 years before retirement are critical — cut equity and single-market exposure, lock in accrued benefits |
How often to review?
At least every two years generally; yearly from 50. Those nearing retirement should watch their MPF closely. Compare funds when reviewing at MPF fund comparison.
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