In Hong Kong, retirement doesn’t mean, well, retirement.
Research by HSBC shows about 61 percent of retirees have to support their family members financially.
The bank interviewed 1,000 residents including 120 retirees. Ther rest were working people.
About 67 percent plan to leave their assets to their descendents but only 14 percent think they will be able to do so in the end, the lowest in Asia and well below the world average of 29 percent.
Wong Hung, an associate professor of the Social Work Department in the Chinese University of Hong Kong, said it is quite hard for young workers nowadays to plan and save for their retirement — their income is just enough to make ends meet.
Because of this, some parents do not expect their children to support them in their old age, Sky Post reported.
Instead, they try their best to help their children save.
Most grown-ups who live with their parents pay no rent and generally don’t contribute toward daily household expenses such as water and electricity. This is their parents’ way of supporting them, Wong said.
According to the World Bank, retirees who want to maintain their living standard need at least 40 percent to 60 percent of their pre-retirement income.
However, as the general contribution rate of the Mandatory Provident Fund in Hong Kong is quite low, the fund cannot fully cover a retiree’s living expenses.
Meanwhile, wealth management experts say people have to start saving early as much money as possible to prepare for retirement.
Cheuk Kai Hung, associate director of Convoy Financial Services, said a Hongkonger who wants to enjoy a decent retirement needs to save HK$10 million (US$1.29 million).
Consider this: if you start saving HK$6,000 a month at age 30, you can save HK$8 million by the time you’re 65, assuming an annual return of 6 percent.
Cheuk said young people should start preparing for retirement in their twenties. If not, they need to double their savings every five years.
An important point is that young people would prefer to buy a house rather than save for their retirement.
“Keep in mind that if you live in your own flat, it provides no income,” he said.
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