Hong Kong: HSBC Life unveiled results of a survey on productive ageing

| 28 Jul 2021

Image: Edward Moncreiffe, Hong Kong, Chief Executive Officer, HSBC Life (middle), K C Cheung, Head of Products, Hong Kong, HSBC Life (right) and Charles Goddard, Editorial Director, The Economist Group (left) revealed key findings of “Productive Ageing in Hong Kong: Breaking the Mould of Ageing” Survey.

The survey conducted by The Economist Intelligence Unit and sponsored by HSBC Life revealed that despite having the world's longest life expectancy reaching 85.3 both sex combined, less than one in four (24%) Hongkongers anticipates spending 20 years or more in retirement. Moreover, only 16% of this group have a retirement planning covering 20 years or more, highlighting the significant mismatch between perception and reality not to mention the resulting retirement gap.

The survey, entitled “Productive Ageing in Hong Kong: Breaking the Mould of Ageing” (the ‘Survey’), was conducted in June 2021 covering 600 adults aged 30 to 70 to understand the state and preparedness of productive ageing in Hong Kong. This is the third study in a row under HSBC Life’s Eldercare Programme first launched in 2019.

Medical/healthcare cost and insufficient savings top the list of biggest concerns on ageing

According to the Survey, 98% of respondents admit having financial concerns on ageing, with the top two being medical/healthcare cost (66%) and insufficient funds (51%). These are followed by the need for regular income security (38%) and concerns on inflation (23%). In this regard, annuities are considered one of the top three streams of income post-retirement with 38% of respondents citing them as their preferred way to secure a regular source of income.

Old-age contribution puts more pressure on retirement funding with sandwich generation feeling the pain most

Infographics by HSBC Life

Contrary to traditional conventions, only 23% of Hongkongers expect their children to take care of them. At the same time, 40% believe parents should support their children even in adulthood, but only 25% have enough monetary reserves to do so.

Infographics by HSBC Life

Given the increasing need for caregiving as life expectancy has increased, 43% of respondents are prepared to support parents diagnosed with cognitive disorder and 24% would even consider quitting their job for caregiving. However, only 28% say they have enough monetary reserves to take care of parents in sickness.

Impact of COVID-19 is also felt in retirement planning

Infographics by HSBC Life

Close to 80% think COVID-19 has aggravated Hongkongers’ preparedness for ageing with pre-retirees aged 40-49 (59%) and 50-59 (61%) being most negatively impacted financially. Similar trends were observed in terms of preparedness for ageing in the social context (64%) and on medical issues (57%). On the flip side, almost 40% of Hongkongers say they will save an additional 10% or even more post-COVID for retirement.

An enabling social system and knowledge of retirement planning will remove key hurdles of productive ageing

While a lack of retirement funding is seen as the biggest hurdle (56%), a high percentage of respondents say a shortage in societal support (48%) and insufficient knowledge of retirement planning (36%) hinder productive ageing in Hong Kong.

Infographics by HSBC Life

Gender difference shows more work needs to be done to support women’s retirement

The Survey findings indicate women are thinking less about retirement and are less prepared than men: 26% of women try not to think about post-retirement (vs. men: 15%) and women are three times more financially dependent on their partners than men (women: 15% vs. men: 5%).

As such, HSBC Life introduced the HSBC Flourish Income Annuity Plan (the ‘Plan’) to help Hongkongers lead a secure, active and engaged retirement life. It is a life insurance product with a savings element offering monthly annuity payments for up to 25 years or till the age of 99 after an accumulation period as short as one year.

New all-round HSBC Flourish Income Annuity Plan helps ensure a secure retirement

As an all-round annuity plan, the Plan provides a 3% increment on monthly guaranteed annuity during the first 10 years of the annuity period and stays level thereafter. Monthly non-guaranteed annuity supported by accumulated dividends will kick in from the 11th year of the annuity period to offer potential long-term wealth appreciation to cope with inflation.

Policyholders will also have the option of enhancing their coverage with additional premiums for extra protection against severe dementia in future to help caregivers cope with the financial challenges they face.

HSBC Life CEO, Edward Moncreiffe, said, “As more people aspire to become ‘slashies’ in retirement, our Survey shows there remains a serious gap between expectations and the reality required for productive ageing. Hongkongers will likely work for 40 years and spend another 25 years or more in retirement." 

“With elderly becoming physically more youthful, ’70 is the new 50’ is our new norm. As such, together we aim to reframe the tone of the dialogue on longevity and propel developments of a clear and measurable impact towards productive ageing. We will continue to mobilise the private and public sectors to build a more supportive ecology to better support the ageing population. As one of the leading insurers in Hong Kong, we have a diverse range of products to meet the retirement needs and will continue to offer innovative solutions to help Hongkongers live longer and retire stronger," he added.

More on HSBC: 

HSBC Life partners dacadoo to enhance health and wellbeing offerings

HSBC Life introduces HSBC Life Benefits+ to help businesses manage employee wellness

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