Retirees need $7.6m nest egg

Hongkongers need around HK$7.6 million of savings to maintain their standards of living after retirement, up from HK$5-6 million a few years ago, according to a Hong Kong Investment Funds Association survey.

A bigger sum is needed due to high inflation in recent years, longer life expectancy and higher post-retirement expectations, said Philip Tso Wai-pong, co-chairman at the HKIFA's pensions committee.

The survey found that savings for retirement are estimated to last for only 17 years on average, which is not enough for Hongkongers who have a life expectancy of 85 years old. It also found that people these days start planning for retirement earlier than before - at the age of 37, with an expected retirement at around 61 years.

The study, which polled 1,001 workers aged 25 to 64 and 80 retirees, revealed that pre-retirees expect the average return of Mandatory Provident Fund investment to be 11.4 percent per year compared to an actual average return of less than 4 percent since the MPF was launched.

Aiden He