Hong Kong's citizens must have a financial game plan for retirement that accounts for all types of health-care costs as well as medical inflation, say financial advisory professionals.
This is because escalating health-care costs related to one or two bad medical mishaps in retirement have the potential to destroy someone's hard-earned and precious life savings.
By 2031, a quarter of Hong Kong's population will be aged 65 or above, according to government figures, and this ageing population is putting pressure on publicly financed health-care spending.
In the face of this, the Hong Kong government is reviewing public hospital services and charges, and encouraging the provision of health care by the private sector.
One of the key risks at retirement is that an individual might outlive his or her retirement income. And although people realise that life expectancy is increasing, they don't truly appreciate its cost implications, according to Bonita Leong, vice-president, marketing and finance, individual financial products at Manulife (International).
'Medical inflation has been quoted by some sources to be as high as 7 per cent per annum,' she said.