Sun Life Asia's third Financial Resilience Index survey revealed 51 percent of respondents lacked sufficient financial buffers to last more than six months without income or external support, amid inflation and rising living costs.
The figure showed that many households may struggle to stay on track if disruptions such as job loss or illness occur, even though 71 percent of respondents understand that sufficient savings are key to financial security.
The findings indicate a trend of weakening financial resilience –the share of highly resilient consumers has fallen to 23 percent, down from 30 percent a year ago. Meanwhile, only 13 percent of respondents are confident in their financial security.
Rising living costs have dominantly shaped household finances in Hong Kong, the survey showed, with 68 percent of respondents saying inflation has made it harder to meet monthly expenses. Cost of living is the single biggest barrier for 30 percent of respondents to taking greater control of their finances, surpassing concerns such as unstable income or limited financial knowledge.
Among household essential expenses, grocery costs impact 91 percent of respondents, followed by utilities at 88 percent and healthcare at 87 percent. Households are facing tough choices due to rising prices: 29 percent are cutting or skipping essential spending, while 21 percent are using their savings. This indicates that short-term financial pressures are risking long-term stability.
Despite financial pressures, respondents are delaying long-term financial planning, with 57 percent prioritizing day-to-day expenses over the next 12 months. In contrast, only 28 percent of respondents would save for retirement, and 24 percent pay for personal healthcare. The survey also found that nearly half of the respondents lack financial plans for building savings and investing regularly.
Meanwhile, while over half of respondents occasionally use Gen AI for financial advice and expect to use it more in the next 12 months, many still prefer human support for more complex financial decisions.
Christine Yeung, deputy chief executive officer of life and health at Sun Life Hong Kong, said that the trend of choosing between spending today and saving for the future, or even cutting back on retirement savings, could further weaken households' ability to cope with future challenges, highlighting the significance of building a solid financial foundation.
