MPF vs the World: How Hong Kong Compares with Singapore, the US and China

Many workers want better-performing MPF funds but can barely choose their trustee today. Hong Kong’s “semi-portability” — due as early as the end of next year — will let employees pick trustees for their own contributions. Other countries run more mature pension systems; using the MPF contribution rate as a starting point, here is how they compare.

How does Hong Kong’s MPF work?

A 5%-each MPF contribution rate, capped at HK$1,000 — with member choice on the way. Employees earning over HK$5,000 a month contribute 5% of income, matched by employers, each capped at HK$1,000. Employers currently pick the provider and members can only choose funds within that scheme — enduring poor trustees in silence. Semi-portability will let employees move the employee mandatory portion (not the employer’s) to a trustee of their choice. HKU’s honorary assistant professor Xu Canjie advises checking fund choice breadth, switching costs and disclosed fees, plus keeping an eye on economic data and fundamentals.

How does Singapore’s CPF differ?

The world’s highest contribution rates — and usable for homes and healthcare. Singapore’s Central Provident Fund predates Hong Kong’s MPF by nearly 45 years and is Asia’s oldest retirement system. Its 33% contribution rate tops the world: 20% employer, 13% employee, tapering with age. Each personal account splits three ways, and contributions can fund home purchases and medical needs — though a minimum sum must be retained at 55 to cover life after 60. Government-run, its investment universe is narrow.

What about America’s 401(k) and China’s basic pension?

America is voluntary; China runs a “three-in-one” social insurance. The US 401(k) is a tax-deferred plan for private-sector staff only, with about 60% participation; it is voluntary, has no minimum, caps contributions at 15% of salary, and members manage their own accounts. China’s basic pension combines a social pooling account, individual accounts and the National Social Security Fund: employers pay 20% of payroll into the pay-as-you-go pool, employees pay 8% into funded individual accounts, and the year-2000 National Social Security Fund acts as the state’s pension reserve.

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