The Mandatory Provident Fund (MPF) is a compulsory pension fund designed by the Hong Kong government as a major protection scheme for the aged and retired residents. Most employees and their employers are required to contribute monthly. A 2012 study by the Consumer Council shows that almost half of the MPF funds have posted losses in each of the past five years.
Smart Money: MPF websites you should know
Useful sites for managing your Mandatory Provident Fund
Despite the controversy generated by the Consumer Council about the fund fees and performance of the MPF, it will be a permanent part of your landscape. Everyone should be ready for the change in rules from November 1 allowing employees to select and move their fund to another approved MPF trustee and scheme. The Securities and Futures Commission and Mandatory Provident Fund Schemes Authority (the MPF regulator) have improved their websites by offering investor education in sections and describe the employee choice arrangement changes in detail.
Both the Chinese and English versions of the Investment Funds Association site's MPF section explain clearly how the scheme works for employers and employees. It shows what factors to consider such as comparing various schemes' offering documents and understanding fund restrictions, switching and withdrawal costs. Detail on fee breakdowns and past performance will help investors.
Manulife's website is easy to read and understand. Whether or not you use Manulife's services, its online tools for retirement planning will make clear where you stand on achieving your retirement goals. There is a section on MPF basics for new employees. The site explains how investment plans change at every stage of your life, such as having a baby or starting a business.