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Hong Kong retirees will need up to HK$7.1 million in savings to secure a 90 percent confidence level in covering expenses after retirement, according to a recent study.
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The report, published by the Hong Kong Retirement Schemes Association (HKRSA) and Willis Towers Watson (WTW), estimates that retirees will need at least HK$20,000 per month to cover basic expenses.
For men retiring at 65, with an estimated average life expectancy of 86, they need HK$4.6 million to cover the expenses. The number will be driven up to HK$6.6 million if they live up to the age of 97.
Women, who have a longer average life expectancy of 90, might need to save HK$5.4 million if retiring at 65. The savings requirement increases to HK$7.1 million for a woman who will be living up to age 100.
The study surveyed employers managing over 90,000 workers, revealing that many companies contribute between 8 and 15 percent of salaries to Mandatory Provident Fund (MPF) or Occupational Retirement Schemes (ORSO) — far above the statutory minimum of 5 percent. Some employers have even removed legal caps on contributions and use matching mechanisms to retain staff.
Researchers noted a strong link between financial well-being and workplace productivity.
To improve retirement security, the HKRSA suggests strengthening related arrangements, including Tax-Deductible Voluntary Contributions (TVC) and Qualifying Deferred Annuity Policies (QDAP). It also urged an independent tax deduction limit, separate TVC deductions for dependents, regular reviews of contribution caps, and broader investment options.
Other suggestions include diversifying retirement income sources by expanding silver bond and local infrastructure bond offerings to hedge inflation. Plot programs could also combine lifetime annuities with long-term care and preventive health services.
William Chow, research director of HKRSA’s 30th anniversary study and head of retirement business for Hong Kong and Macau at WTW, noted that retirement adequacy remains challenged by structural factors such as longevity, rising living costs and limited voluntary savings.
“Employers are already contributing above statutory requirements,” Chow said. He added that optimizing retirement scheme designs, providing targeted financial education, and offering more convenient saving options could further strengthen retirement readiness.
