Workers in Hong Kong are putting their savings at risk by investing into stocks when they retire.
Manulife Hong Kong surveyed over 1,000 people and found around one-third of working people in the special adminstrative region will invest their pension pots in retirement and be exposed to high volatility .
By the time they retire, respondents expect to have saved on average HK$3.97m (£420,000, $512,000, €475,000).
Based on their expected retirement age (63 years’ old) and the average lifespan in Hong Kong (85 years’ old), their average monthly disposable income would be about HK$15,000 for a total of 22 years during their retirement.
Over half (52%) of respondents believe that their savings would not be sufficient to support their retirement and to bridge the shortfall; they plan to spend less, seek government subsidies, continue working, or invest.
Planning matters
Raymond Ng, vice president and head of employee benefits at Manulife Hong Kong, said: “Retirement is the time to reap one’s harvest.
“The size of this harvest depends a lot on how carefully you plan for your retirement, in both pre- and post-retirement stages.
“After retirement, putting funds into cash savings is not ideal, because inflation will without a doubt erode them, and investing in stocks exposes retirees to the risk of volatility.
“Equally important, however, is preserving and growing a nest egg in the post-retirement period as life expectancy is getting longer nowadays.”
