The Covid-19 pandemic has left most working adults in Hongkong fearing for their financial position and readiness for retirement, according to a survey by the Economist Intelligence Unit commissioned by HSBC Life Insurance.
Some 98 per cent of Hongkongers expressed worries about ageing in the city, with medical and health care costs, insufficient savings and income security dominating their top concerns. Less than a quarter of them expect to have to spend 20 years or more in retirement. Among this group, only 16 per cent have made plans for more than 20 years of life without a salary.
The annual online survey, conducted in June, targeted 600 people aged 30 to 70 in Hong Kong about their needs in preparing for older age. It was also supplemented by interviews with ageing-related non-government organisations or advocacy groups, academics and government bodies.
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“Hongkongers will likely work for 40 years and spend another 25 years or more in retirement,” said Edward Moncreiffe, Hong Kong chief executive of HSBC Life. “Our survey shows there remains a serious gap between expectations and the reality required for productive ageing.”
The findings exposed shortcomings in retirement planning as the city continues to rank among the most expensive to live in globally as prices for basic needs like housing have skyrocketed. That is compounded by the high average life-expectancy of 85.3 years among Hongkongers – a world record based on United Nations statistics.
While there is no official retirement age in Hong Kong, private companies generally ask their workers to retire upon reaching 60 or 65 in line with the local civil service requirements.
With the pandemic still raging in many countries, close to 80 per cent of the survey respondents believe the coronavirus has aggravated what was already a stinging rebuke of the retirement shortcomings in the city. Those aged 40 to 59 were hit the hardest financially, the survey found.
This confirmed the dire outlook from other surveys. Nine out of 10 middle-income Hongkongers approaching retirement age have no firm plan to stop working because they fear their pension savings are insufficient, according to an industry survey published earlier this month, with those bordering retirement age seeing no way of quitting their jobs.
Because of the pandemic, some 40 per cent of those in the EIU survey said that the public health crisis had motivated them to try to top up their retirement nest egg by setting aside an additional 10 per cent or more savings.
Financial needs aside, the pandemic has also dialled up the challenges of social isolation among elderly citizens. Some 48 per cent of the survey respondents blamed the shortage of societal support for hindering their ability to age productively in Hong Kong.
“Covid-19 was a major setback for older people in Hong Kong, as different waves of lockdowns restricted their movement and required them to stay home,” said Charles Goddard, editorial director at the Economist Group.
Other findings shed light on gender differences in retirement planning.
Just over a quarter of the women surveyed said they tried not to think about their lives post-retirement, compared with 15 per cent for men. The EIU survey also found that women are three times more financially dependent on their partners than men.
One of the reasons for these differences lies in gender biases at work, which adversely affect women’s career advancement and earnings, said Fiona Nott, chief executive officer at The Women’s Foundation, which partnered with the EIU on the survey.
“As society ages we should ensure there are gender-sensitive solutions so that women are not left behind and everyone can thrive in their later years,” she said.
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