8 per cent of Hong Kong retirees used MPF funds to help their children buy property, finds survey
HKIFA study also shows retirees were too conservative with investments made once they had encashed their MPF
Some Hong Kong retirees are using their Mandatory Provident Fund savings to help their children buy property, according to a survey conducted by the Hong Kong Investment Funds Association.
A poll of 600 retired people conducted between July and September last year found that 8 per cent had used their MPF to either help their children buy property, or support them with other needs such as education.
“We cannot fault parents for caring, but they should pay attention to the potential risks that arise when they neglect to prepare for their own retirement,” says Stephen Fung, the chief executive of the MPF at insurance company AIA.
The MPF is a compulsory retirement scheme, with more than HK$843 billion (US$107.45 billion) in assets, that covers 2.8 million employees in Hong Kong. Employers and employees each pay 5 per cent of the staff member’s salary into different investment funds run by providers. The employees can get their contribution and investment returns at the age of 65.
Separate surveys conducted by HSBC and AIA last year also show that while Hong Kong retirees could not expect their children to support their retirement, it was the children’s property dreams or other financial needs that were eroding their parents’ retirement savings.