Majority of respondents fear for health and finances upon retirement; half expect passive income
HONG KONG, Aug. 12, 2021 /PRNewswire/ — Close to one-third of Hong Kong people said their financial priority at present is to save for retirement, according to a new survey commissioned by Manulife. The research also revealed that in addition to maintaining good health and current living standards, attaining “financial freedom” is one of the top priorities for an ideal retirement.
Manulife surveyed 1,034 Hongkongers to learn more about their plans and preparations for retirement, as well as their savings priorities and concerns. The survey, conducted between June and July 2021, found the average target retirement age is 62, but only 41% of respondents are confident of retiring by their desired age. The majority of respondents fear for their health and finances upon retirement.
“When it comes to retirement, people know what they want, but worry they might not get there,” said Mr. Wilton Kee, Chief Product Officer and Head of Health, Manulife Hong Kong. “On one hand, Hong Kong people look forward to their retirement – many have a clear vision of what the ideal retirement life entails. On the other, people also worry about worsening health conditions and having insufficient savings. Three in 5 are unsure whether they can retire at an age they desire.”
Unsurprisingly, respondents who have already commenced their retirement planning tend to be more confident in retirement going according to plan, as compared to those who have not started. Over half (58%) of respondents who have started retirement planning are positive about retiring by their target age, compared to only 29% for those who have not started retirement planning.
More than half expect passive income in their retirement
Defined as a regular income that requires minimal effort to maintain, passive income is often perceived as a key avenue to achieving financial freedom. The survey revealed that more than half (53%) of respondents are aware of the term “passive income”, with younger people (aged 18-34) being most aware (71%).
Over half (54%) of respondents believe they will have passive income when they retire. Among those who are expecting passive income in their retirement, high dividend stocks (60%), annuities (40%), income funds (39%) and rental income from property investments (38%) are most selected as sources of income. These respondents generally believe their passive income will be able to cover around half (45%) of their total retirement expenses on average.
“Acquiring passive income is key to sustaining a desirable life during retirement. Planning ahead to secure various sources of funds will enable retirees to maintain pre-retirement living standards, cover health costs or unexpected expenditure, and even travel and enjoy life without being stressed about money,” Mr. Kee added.
When selecting the top 3 elements for an ideal retirement, respondents prioritized maintaining good health conditions (72%), keeping current living standard (44%), followed by attaining financial freedom with passive income (40%). On the flipside, when asked about worries, respondents indicated deteriorating health (54%) and not saving enough upon retirement (39%) as their top concerns. These results corroborate with the rest of the findings.
New life planning starter solutions for life and critical illness coverage
Manulife has launched three new products, namely ManuPremier Protector, ManuElite Protector, and CareGuard Critical Illness Benefit.
ManuPremier Protector and ManuElite Protector are two lifelong protection plans that offer long-term savings potential through a non-guaranteed terminal bonus. With different premium levels and potential returns, the two plans come with a “realization option”, which customers can exercise on their 15th policy anniversary or every anniversary thereafter and lock in up to 50% of their terminal bonus amount, thereby giving them extra liquidity to address different financial needs. Both are eligible life insurance plans under the Policy Reverse Mortgage Programme (‘PRMP’), providing customers with a stream of steady cashflow for a carefree retirement[1].
Designed to enhance the medical protection of selected plans, as a supplementary benefit, CareGuard Critical Illness Benefit is available in two versions, CareGuard Critical Illness Benefit (Core) and CareGuard Critical Illness Benefit (Enhanced), offering customers the flexibility to choose essential or well-rounded critical illness protection. In addition to protecting customers against up to 112 designated critical illnesses and diseases[2], the supplementary benefit goes beyond critical illnesses to cover 59 complex surgeries up to 80 years of age.
“Planning early with trusted retirement expert is key. At Manulife, we believe in the three pillars of life planning – wealth accumulation, health protection and retirement income. With our diverse range of product offerings, our customers can have their own choice of when and how they can retire, and enjoy the financial freedom with peace of mind they deserve.” Mr. Kee concluded.
For more details about ManuPremier Protector, please visit here. For more details about ManuElite Protector, please visit here. For more details about CareGuard Critical Illness Benefit, please visit here. The content of this press release does not contain the full terms of the policy(ies), and the full terms can be found in the policy document(s). Please refer to the relevant product leaflets for product features and risks.
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[1] Manulife shall not be responsible for the policyowner’s suitability and eligibility to apply for PRMP. You should always seek for advice from professional bodies if you have any doubts. Please note that the information provided is subject to change including the eligibility criteria for PRMP. We do not take any responsibility to inform you about any changes and how they may affect you. The PRMP is operated by HKMC Insurance Limited, a wholly-owned subsidiary of The Hong Kong Mortgage Corporation Limited (HKMC). For further information, please refer to HKMC website: www.hkmc.com.hk. |
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[2] Early stage critical illness benefit and juvenile disease critical illness benefit are applicable to CareGuard Critical Illness Benefit (Enhanced) only |
About Manulife Hong Kong
Manulife Hong Kong, through Manulife International Holdings Limited, owns Manulife (International) Limited, Manulife Investment Management (Hong Kong) Limited and Manulife Provident Funds Trust Company Limited. As a member of the Manulife group of companies, Manulife Hong Kong offers a diverse range of protection and wealth products and services to individual and corporate customers in Hong Kong and Macau.
About Manulife
Manulife Financial Corporation is a leading international financial services provider that helps people make their decisions easier and lives better. With our global headquarters in Toronto, Canada, we operate as Manulife across our offices in Canada, Asia, and Europe, and primarily as John Hancock in the United States. We provide financial advice, insurance, and our global wealth and asset management segment, Manulife Investment Management, serves individuals, institutions and retirement plan members worldwide. At the end of 2020, we had more than 37,000 employees, over 118,000 agents, and thousands of distribution partners, serving over 30 million customers. As of June 30, 2021, we had C$1.3 trillion (HK$8.1 trillion) in assets under management and administration, and in the previous 12 months we made C$31.3 billion in payments to our customers. Our principal operations are in Asia, Canada and the United States where we have served customers for more than 155 years. We trade as ‘MFC’ on the Toronto, New York, and the Philippine stock exchanges and under ‘945’ in Hong Kong.
SOURCE Manulife Hong Kong