The Urgency of Retirement Planning Among Hongkongers Amid Covid-19 Pandemic: Survey Findings and Concerns

The Covid-19 pandemic has undoubtedly changed the way Hongkongers view retirement planning. With the average age of planning for retirement dropping from 45 to 40 in just a few years, it is clear that the sense of urgency has increased significantly. A recent survey by Schroders Hong Kong Retirement Survey 2024 sheds light on the shifting attitudes and concerns of non-retired individuals in Hong Kong.

One of the most significant findings of the survey is the increased expectations for investment returns post-Covid. Non-retired Hongkongers now expect an average of 5.7% in nominal returns annually, a significant increase from 3.7% in 2018. This shows a growing awareness of the need to accumulate wealth for retirement in a more efficient manner.

The top three retirement-related concerns among respondents are also worth noting. Higher healthcare costs than expected, inflation reducing the value of assets, and a potential prolonged recession affecting their life and career are at the forefront of their minds. These concerns highlight the importance of effective wealth management and careful planning for the future.

Interestingly, there is a divide in attitudes towards retirement planning among respondents. While some are eager to prepare for their future and are willing to make sacrifices in their current lifestyle, others prioritize immediate experiences over financial security in the future. This highlights the need for a balanced approach to retirement planning that takes into account both present enjoyment and future financial stability.

One of the most alarming findings of the survey is the potential shortfall in financial preparedness for retirement among non-retirees. With an average HK$2.4 million gap between desired financial reserves and expected expenditure, many individuals may find themselves struggling to maintain their desired lifestyle post-retirement. This underscores the importance of starting retirement planning early and being proactive in managing finances.

In conclusion, the survey highlights the importance of early and proactive retirement planning among Hongkongers. With the average intended retirement age being 62 and a significant gap in financial preparedness, it is crucial for individuals to start planning for their future as soon as possible. By being mindful of their financial goals and taking steps to secure their financial future, Hongkongers can ensure a comfortable and worry-free retirement.