Over half of Hong Kong residents plan to work past 65, survey shows
About 52 per cent of respondents indicated they would not retire at age 65. Among them, about 80 per cent preferred not to retire at all or opted instead for a 'micro-retirement', which involves taking a break for several months to a few years before returning to work.
The survey, the first of its kind by the US financial firm, polled 600 Hong Kong residents over the age of 30 in May.
'Financial pressure is certainly one factor, especially in a high-cost city like Hong Kong,' said Shen Wenting, global investment solutions strategist and portfolio manager at T. Rowe Price, which manages US$1.56 trillion in assets.
About 60 per cent of respondents had a retirement savings target between HK$2 million and HK$10 million, with the average being HK$5 million, considered enough for them to feel secure in completely stopping work. For those considering a micro-retirement, the average savings target was HK$2 million.
However, one-third of respondents felt they could not achieve their goals, and 40 per cent reported not having any retirement savings target at all. This may explain why 62 per cent cited the need to maintain an income as their reason for not retiring at age 65.
The survey showed that non-financial motivations were equally influential, Shen said, noting that 69 per cent of respondents wanted to continue working to keep their minds active, while 40 per cent sought the sense of accomplishment that work provided.
About 72 per cent said they would be satisfied with earning less from their jobs after retirement age.
For those opting for micro-retirement, 34 per cent sought a break to improve their well-being, 24 per cent aimed to relieve work pressure, and 16 per cent wanted to pursue personal interests.
'These findings suggest a growing desire to reprioritise life beyond just income,' Shen said.
Financial firms like Manulife, HSBC and BOC Life have been targeting retirees with new investment products that offer regular income streams, amid a broader government-led initiative to capture opportunities in the so-called silver economy.
People aged 65 and above comprised 22 per cent of Hong Kong's 7.5 million residents last year, according to official data. Projections indicated that senior citizens would account for 31 per cent of the population by 2036.
Shen said only 20 per cent of respondents were aware of retirement investment products, while many opted for conservative investment strategies. About 54 per cent kept their retirement savings in time deposits, which currently offer interest rates of only 1 per cent to 2 per cent, while 52 per cent chose savings accounts with almost zero interest.
Only 30 per cent opted for higher-return investments such as mutual funds, and 24 per cent invested in annuities.
Shen attributed the conservative investment choices to the entrenched belief that 'cash is king', as well as economic uncertainty. She urged retirees to consider a different investment approach to meet their retirement goals.
For those wishing to retire at 65, investing more in stocks at a younger age could yield higher returns, while shifting to lower-risk fixed income as they aged was advisable, Shen suggested.
Individuals who plan to continue working might consider adjusting their asset allocation towards a slightly more aggressive stance, with a higher percentage in equities to capitalise on growth opportunities, she added.
For micro-retirees, taking a career break of a couple of years 'will not substantially change their retirement horizon', Shen said. 'We suggest following a glide path based on a general estimate of time left until retirement.' - SOUTH CHINA MORNING POST
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