Why Make Voluntary MPF Contributions?

Why top up beyond mandatory MPF?

In July 2011, Fidelity Hong Kong’s Cheng Kim-wai wrote that total employer-employee contributions of just 10% of salary (5% each) could hardly fund retirement as lifespans lengthened — voluntary saving and investing was the way out. Raising the rate by 2.5% (HK$250 more a month) for a 22-year-old earning HK$10,000 could mean about HK$1.2 million more at retirement over 40-plus years at 10% annual return.

What are the perks of voluntary MPF contributions?

Contribute via your existing scheme or a Special Voluntary Contribution (SVC) account, monthly or lump-sum; SVCs waive subscription, redemption and switching fees — cheaper than retail monthly plans — with no term limit and withdrawals allowed before 65 (free withdrawals per year are capped).

How to encourage more saving?

Voluntary contributions were only about 13% of total contributions, mostly from employers; the HK$12,000 annual tax deduction cap could be raised to sharpen incentives, Cheng suggested. Compare schemes at MPF fund comparison.