Sun Life Hong Kong Announces Latest Sun Life Retirement Mastery Index

Hong Kongers’ retirement mastery improves compared with last year.

Sun Life Hong Kong has revealed the latest Sun Life Retirement Mastery Index (“Index”)1, with the score increasing by 4.8 to 61.1. The index reveals that Hong Kongers’ control over retirement planning is gradually improving, particularly evident in their performance in “Positive Experiences”, which is believed to have an influence on creating the ideal retirement.

The Sun Life Retirement Mastery Index studies Hong Kongers’ degree of control over retirement planning by evaluating their real performance in three pillars: “Intelligence”, “Momentum”, and “Positive Experiences”. “Intelligence” assesses the individuals’ information and knowledge of retirement planning and retirement savings; “Momentum” looks at concrete actions taken to plan and save for retirement; and “Positive Experiences” considers personal experiences on the retirement journey.

Based on the responses of those surveyed, the final scores for “Intelligence”, “Momentum”, and “Positive Experiences” are 60.2, 60.9, and 62.5 respectively. Married persons continue to outperform singles in terms of retirement planning, with their score increasing from last year’s 58.6 to this year’s 64.3, while the score for singles is only 52.4, similar to that seen last year.

This year, the deficit between the perceived importance and the real performance of retirement planning narrows overall. More than half of respondents agree that the mastery of “Intelligence”, “Momentum”, and “Positive Experiences” are all very important for retirement planning and retirement savings, while approximately 40% are very satisfied with their real performance, a significant improvement over last year’s 30%.

“Positive Experiences” Scores the Highest Among The Three Pillars

In terms of the three pillars, most people feel they are doing very well in “Positive Experiences”, with the percentage rising significantly from last year’s 33% to this year’s 44%, higher than the proportions of those who feel they are doing well in the other two aspects. 50% of the respondents are confident about achieving their retirement goals, 12 percentage points higher than the previous year.

In comparison, 43% of the respondents claim they are doing very well when it comes to “Momentum”, representing an increase of 9 percentage points compared to last year’s 34%. In addition, 50% are very satisfied with the frequency of their personal finance review, while 48% maintain a positive attitude towards the management of their retirement savings portfolio.

Hong Kongers underperform in terms of “Intelligence”. Although 54% of the respondents believe it is important, only 40% feel they are doing very well in this aspect – the largest gap between perceived importance and real performance across the three areas. Meanwhile, 50% of the respondents claim they have carefully researched their expectations and needs for retirement life, which represents an increase of eight percentage points compared to last year’s 42%. Moreover, 47% of the respondents are very satisfied with a personal review of the performance of all their retirement investments and savings portfolios, higher than last year’s 36%. 

Christine Yeung, General Manager, Life and Health of Sun Life Hong Kong Limited, said, “As a client-oriented business, we not only provide diversified insurance products for our clients, but also keen to share the latest insights to general public on retirement planning trends and market developments through our annual Sun Life Retirement Mastery Index. With the Index now in its second year, we are pleased to see that people in Hong Kong have gradually enhanced control over all aspects of retirement planning. Although there is still room for improvement, the overall performance is inspiring. However, given high inflation and an increasingly uncertain global outlook, we cannot be complacent. People should start planning and saving for retirement as early as possible in order to reinforce their defensive capabilities, giving them control over their retirement life in the future.”

Making a Greater Effort to Retire Earlier

Hong Kongers are increasingly inclined to retire at an earlier age. 40% of the respondents said they hope to retire before the age of 60, an increase of seven percentage points compared to last year’s 33%. Many people may also be making a greater effort to retire earlier, as the survey found that more Hong Kongers have stepped up efforts to plan and save for retirement compared to the previous year. 63% of respondents stated that they have worked harder to plan for retirement compared with the previous year, an increase of 11 percentage points from the 52% seen in 2021. Meanwhile, 62% believe they have worked harder to implement their retirement savings plan compared with the previous year, also an increase of 11 percentage points compared to last year’s 51%.

Furthermore, 88% of the respondents take their parents into account when planning for retirement. According to the respondents, the median amount of housekeeping money that they give to their parents per month is HK$5,000, with over half (53%) of them saying they would continue to fully cover that money after retirement. Although 82% agree that it is the children’s duty to support their parents, 91% of the respondents hope they can be self-sufficient after retiring, without putting economic pressure on their children or family.

Chris Fung, Chief Client and Marketing Officer of Sun Life Hong Kong Limited, said, “Affected by the COVID-19 pandemic over the past two years, over 80% of the respondents said they are more concerned about their own health and that of their family, and are considering buying or increasing their personal and / or family health insurance. Although Hong Kong people have enhanced their health awareness due to the pandemic, they should still pay heed to potential medical expenses after retirement. As such, we should all get into the habit of reviewing our personal retirement plan and progress regularly to help ourselves and our family be prepared. With a 130-year history in Hong Kong, Sun Life is committed to continually redefining the client experience through ongoing digital innovation, striving to create the ideal retirement life with our clients.”

Many Hong Kongers may consider moving elsewhere within the Greater Bay Area after they retire. 71% of the respondents believe that the insurance connect scheme will increase their interest in moving within the Greater Bay Area post-retirement, hoping that the scheme will streamline the insurance application formalities and underwriting procedures through financial technology (46%), and provide more comprehensive protection for living in the Greater Bay Area (44%).

More Cautious About Wealth Management After COVID-19

The survey also analyzes the investment stance and need for wealth management products among Hong Kong people in the post-pandemic era. 74% of the respondents feel they are less capable of accumulating wealth compared to two years ago, while 88% prefer to set a mid-term wealth management goal due to the unstable macro environment, which indicates local people are tending to be more cautious about wealth management these two years. However, 70% of the respondents are positive about the investment outlook for the next 12 months, mainly because economic activities have resumed (65%) and the pandemic has been gradually brought under control (63%).

When it comes to the factors that determine their wealth management decision making, the respondents said the major consideration is the guaranteed return of wealth management products (47%), followed by their potential return (39%) and high liquidity (36%).

In terms of products, 73% of the respondents are interested in ESG investing, with 51% of them aspiring to support sustainable development through such investment and 44% claiming it helps boost long-term potential investment returns. In addition, 98% of the respondents who are interested in ESG investment are considering investing in ESG-related wealth management products in the next 12 months.

Sun Life Hong Kong commissioned NielsenIQ (Hong Kong) Limited to survey 1,000 financially capable Hong Kongers, aged 30 to 45. The survey was conducted via an online questionnaire between June 2 and June 14, 2022. The final score is extrapolated and calibrated from the feedback received under the three pillars. CLICK HERE for more details of last year’s survey result.