Hongkongers to MPF: we want higher-risk, higher-return investment options to boost our retirement savings

Hong Kong residents want the option of putting their pension contributions into higher-risk, higher-return funds to help them to meet their retirement needs, according to a survey by the Hong Kong Investment Funds Association (HKIFA).

Hongkongers on average want to retire at 61, and they believe they need HK$7.6 million (US$975,000) to have a comfortable retirement life, according to the survey of more than 1,000 residents in August and September, released on Monday.

However, they consider the city’s compulsory Mandatory Provident Fund (MPF) insufficient for achieving this target. So they want the option of investing in sustainable-development funds that invest in environmentally positive projects (cited by 48 per cent of respondents), high-yield bonds that invest in infrastructure (46 per cent), and new technology (38 per cent), according to the HKIFA survey.

“The MPF performance in recent years has been low due to the market turmoil, which has led the MPF members to demand more fund choices, particularly those that have higher return prospects, for them to invest,” said Gordon Tsui Luen-on, a veteren Hong Kong broker who is the director of the Hong Kong Securities and Investment Institute.

“Sustainable development funds and high-yield bonds funds are popular options which MPF members look for,” said Philip Tso, co-chair of the HKIFA’s pension subcommittee.

The MPF on average has HK$232,880 for each of its 4.7 million members, based on assets of HK$1.09 trillion at the end of September, according to data provided by research firm MPF Ratings.