MPF’s Ten-Year Annualised Return: 5.5%, Beating Inflation

In April 2011 the MPFA announced that since its launch, MPF had delivered a 5.5% annualised return after fees — outpacing inflation over the same period and vindicating long-term investing.

What does 5.5% mean?

Contributions grew 5.5% a year on average after fees. From the December 2000 launch to early 2011, total MPF assets kept growing and members’ accrued benefits rose steadily. Despite the dot-com bust and the global financial crisis in between, long-run returns still beat inflation.

Why do critics still complain?

Because fees ate a chunk of it. The 5.5% is net of fees — gross returns were higher, and critics say lower fees would have left members with more. It’s also a system-wide average; individual funds vary widely, and members who picked badly fared far worse.

What should members do?

Review regularly — don’t file and forget. MPF is a decades-long investment: pick low-fee funds matching your risk appetite, review the mix periodically, and let compounding work. Compare MPF funds’ fees and track records at MPF fund comparison.