Choosing MPF is like finding the right one to tie the knot. Relying on gut feeling might not be a good approach… The MPF Authority has released the provisional figures for the 2023 investment return of MPF schemes, showing a positive return of 3.5%. All 6 categories of MPF funds achieved positive returns, with mixed assets funds performing the best at 7.2% and equity funds performing the worst at 0.8%. As of the end of last year, the total assets of the MPF were about HK$1.14 trillion.
That’s why we’re offering you a simple directory to help you find your most-fitted MPF Funds and MPF withdrawal tips.
Table of contents: MPF Funds in Hong Kong
- What is MPF?
- How to Choose MPF Funds?
- MPF fund performance
- Fees and charges
- Service of provider
- Asset Allocation Strategy
- How to Check MPF Fund Performance
- If You Have More Than One MPF Accounts, Should You Consolidate Them?
- How To Withdraw MPF?
- Final Words: Riding The Waves of Changes
- Frequently asked question: How to Choose MPF Funds in Hong Kong?
- Related articles
What is MPF?
The Mandatory Provident Fund (MPF) System started on 1 December 2000. It is the second pillar of Hong Kong’s retirement protection framework. The MPF System regulates mandatory, privately-managed, and fully-funded contribution schemes. Covered individuals, including employees, employers, and self-employed persons, must make regular mandatory contributions to an MPF scheme. The contribution is calculated at 5% of the relevant income, subject to minimum and maximum income levels.
Currently, 13 MPF trustees are offering 27 schemes to about 4.5 million members and 330,000 employers. The total net asset value of all MPF schemes exceeds $1,100 billion, with an annualized internal rate of return of 3.7% since the establishment of the MPF System 20 years ago.
How to Choose MPF Funds?
For choosing MPF Funds, no strategy fits all, but here are the 5 factors you might consider to find suitable MPF Funds.
Risk tolerance level
When selecting MPF Funds, it is essential to consider not just the potential gains but also the losses to maximize the MPF benefits at retirement. This is where the risk tolerance level comes into play — an indicator that shows your willingness to risk your capital.
Here are some sample questions that will help you determine your risk tolerance level:
- Are you going to retire within 5 years?
- Is the MPF Fund your only source of retirement funds?
- Are you inexperienced in investing?
- Do you prefer a guaranteed small gain with no loss over a huge gain with potential loss?
Each “Yes” answer means you prefer a lower risk of losing your capital over potential larger gains. That indicates you might have a lower risk tolerance level tendency. If you’re interested to find out yours in detail. Check out BEA’s Risk Tolerance Self-Assessment.
Fund risk
Once you figure out how much risk you’re comfortable with, you can pick the MPF Funds that are the best fit for you. There are 5 main types of MPF funds to choose from. Here’s a quick rundown of how risky each one is:
MPF Conservative Fund
MPF Conservative Fund has the lowest risk among the other five MPF Funds. It’s formed by low-risk, short-term bank deposits and short-term bonds.
Guaranteed Fund
Guaranteed Fund has a relatively low risk. However, note that the guarantor may fail to deliver the guaranteed return. Be aware of the credit risk of the related insurance company if you invest in Guaranteed Funds that are invested in an insurance policy.
Bond Fund
Bond Fund is generally seen to be a lower-risk investment, but don’t forget to consider bond prices may be influenced by interest rates, exchange rates and bond credit ratings.
Mixed Asset Fund
Mixed Asset Fund has a medium risk between a bond fund and an equity fund. The risk will become relatively higher if the Fund has a larger proportion of stocks.
Equity Fund
Equity Fund has the highest risks among other MPF funds. Stock market volatility and exchange rate fluctuations may affect the Fund’s return.
MPF Fund Performance
MPF Fund Performance indicates an MPF Fund’s return in the past, but remember that the past can’t predict the future. It is important not to base investment decisions solely on a fund’s past performance.
Fees and charges
You should always keep an eye on the fees and charges despite the excellent performance of an MPF. Otherwise, your return will be eaten up by the fees and charges. Here is an overview of the average fees and charges of the 5 MPF Funds Types:
| MPF Fund Types | FER range | Fees |
| MPF Conservative Fund | 0.11-0.72% | Charges only when the returns exceed the monthly prescribed savings rate (PSR). |
| Guaranteed Fund | 1.29-3.33% | A guarantee or reserve fee in addition to the basic MPF fund charges |
| Bond Fund | 0.78-1.82% | a percentage of the fund’s net asset value |
| Mixed Asset Fund | 0.59-1.92% | a percentage of the fund’s net asset value |
| Equity Fund | 0.62-2.14% | a percentage of the fund’s net asset value |
Wanna know more about the fees and charges? Check out “MPF Schemes Fees and Charges Comparison: Management Fees and FER” for more details.
Service of provider
Not only considering the fees, but you may also want to consider the MPF Fund’s service. Trustee Service Comparative Platform has provided the services offered by different MPF schemes from different trustees, including fund choices, account administration and customer services, and enquiries channels that fit your need.
Asset Allocation Strategy
You may deploy your risk-managing plan according to the risk tolerance level. Here are some tips for both high-risk and low-risk strategies.
High-risk strategy
- Putting a larger share of equities in your MPF Funds may help to achieve capital gain and obtain higher risks.
- Sector equity funds are generally riskier than other types of equity funds.
- Concentrating on a single market equity fund brings higher exposure risk.
Low-risk strategy
- Fewer shares, more bonds. Reducing the portion of equities and holding more bonds or low-risk assets help lower the risk in the investment portfolio.
- Don’t put all eggs into a basket”. Diversifying the portfolio across regions or asset classes helps reduce the exposure risk to specified assets.
- The “100-minus-age rule” is a reference to estimate the appropriate equity content in a portfolio. If let’s say, you are 25 years old, then equities should make up (100 – 25 = 75%) 75% of your portfolio and the remaining 25% goes to bonds or other low-risk assets.
- Inflation risk. Don’t forget to put inflation into the calculation. Consider your Funds return should be higher than the inflation rate. Otherwise, your portfolio will lose value against inflation.
How to Check MPF Fund Performance
MPF Fund Platform is a great tool for reviewing MPF fund performance. It provides all the filters you need for finding the MPF funds. You can search funds by their fund types, fund category, trustees, scheme, and 10 highest/lowest funds by return or fund expenses ratio (FER).
Top 5 MPF Performance in the past performance of 1-year accumulated
| Scheme | Constituent Fund | Past 1 Year Accumulated |
| AIA MPF – Prime Value Choice | MPF Conservative Fund | 0.66 |
| BOC-Prudential Easy-Choice Mandatory Provident Fund Scheme | BOC-Prudential MPF Conservative Fund | 0.55 |
| Manulife Global Select (MPF) Scheme | Manulife MPF Conservative Fund | 0.51 |
| SHKP MPF Employer Sponsored Scheme | Invesco MPF Conservative Fund | 0.47 |
| Principal MPF Scheme Series 800 | Principal Capital Guaranteed Fund – Class D | 0.46 |
Top 5 MPF Performance in the past performance of 5-year accumulated
| Scheme | Constituent Fund | Past 5 Years Accumulated |
| BOC-Prudential Easy-Choice Mandatory Provident Fund Scheme | BOC-Prudential North America Index Tracking Fund | 44.04 |
| BEA (MPF) Master Trust Scheme | BEA (MPF) North American Equity Fund | 41.53 |
| Hang Seng Mandatory Provident Fund – SuperTrust Plus | North American Equity Fund | 40.95 |
| Manulife RetireChoice (MPF) Scheme | Allianz Oriental Pacific Fund – Class B | 40.52 |
| Manulife RetireChoice (MPF) Scheme | Allianz Oriental Pacific Fund – Class T | 40.13 |
Top 5 MPF Performance in the past performance of 10-year accumulated
| Scheme | Constituent Fund | Past 10 Years Accumulated |
| BOC-Prudential Easy-Choice Mandatory Provident Fund Scheme | BOC-Prudential North America Index Tracking Fund | 161.8 |
| BEA (MPF) Master Trust Scheme | BEA (MPF) North American Equity Fund | 157.84 |
| MASS Mandatory Provident Fund Scheme | US Equity Fund | 156.82 |
| HSBC Mandatory Provident Fund – SuperTrust Plus | North American Equity Fund | 155.76 |
| AIA MPF – Prime Value Choice | North American Equity Fund | 151.91 |
If You Have More Than One MPF Accounts, Should You Consolidate Them?
It’s common for Hong Kongers to have more than one MPF accounts after switching jobs. It’s recommended to consolidate your MPF accounts to save time and effort in managing various accounts.
How to consolidate your MPF personal accounts
That’s not a complex task to do. All you need to do is to find out all the current scheme names and account numbers you have. Then fill in the consolidation form and submit it to your chosen trustee.
What if you don’t know how many accounts you have?
If you have no idea how many MPF accounts you have, you may download and submit the “Personal Account Information Enquiry Form” to the MPFA with a copy of your HKID card. The MPFA will reply with your MPF information. However, it won’t provide the account numbers you will have to obtain them from the trustees directly.
You can also apply the MPFA’s e-Enquiry of Personal Account to check your personal account online.
How To Withdraw MPF?
MPF can only be withdrawn when you reach 65 and decide to retire. However, there’re two common ways to withdraw MPF before 65 years old:
- You are at least 60 years old and take early retirement.
- You have left or are about to leave Hong Kong for good.
When you reach 65 or retire early at 60, you can withdraw your MPF benefits either in full or partially by contacting your MPF Trustee.
If you’re leaving Hong Kong for good, you can take out your MPF benefits tax-free. You are required to make a statutory declaration that you have departed or will depart from Hong Kong to reside elsewhere with no intention of returning for employment or resettling in Hong Kong as a permanent resident.
How to make a statutory declaration
You may make a statutory declaration signed by a Commissioner for Oaths from Public Enquiry Services Centres of District Office, a Notary Public, Justice of the Peace in Hong Kong.
Can you withdraw MPF from abroad?
You may withdraw your MPF and make a statutory declaration if you live abroad. Still, it must be signed and sealed (if necessary) by a Notary Public or an authorized person authorized by law to take and receive declarations.
Final Words: Riding The Waves of Changes
“Riding the waves of changes” is the perfect metaphor for managing your MPF account. We all have different investment goals and risk tolerance over time. Remember to review your investment strategy according to your investment horizon and make the most out of it.
Frequently asked question: How to Choose MPF Funds in Hong Kong?
How much should I contribute to my MPF?
The amount you should contribute to your MPF depends on various factors such as your income, financial goals, and retirement plans. It is recommended to contribute the maximum allowed by law to maximize your retirement savings and enjoy the tax benefits associated with MPF contributions.
Can I withdraw my MPF before the age of 65?
In general, you can only withdraw your MPF benefits when you reach the age of 65 and decide to retire. However, there are certain circumstances in which you may be able to withdraw your MPF before the age of 65, such as early retirement at 60 or leaving Hong Kong permanently. You should consult with your MPF trustee to understand the specific rules and requirements for early withdrawal.
What happens to my MPF when I change jobs?
In general, you can only withdraw your MPF benefits when you reach the age of 65 and decide to retire. However, there are certain circumstances in which you may be able to withdraw your MPF before the age of 65, such as early retirement at 60 or leaving Hong Kong permanently. You should consult with your MPF trustee to understand the specific rules and requirements for early withdrawal.
How often should I review my MPF fund performance?
It is recommended to regularly review the performance of your MPF fund to ensure that it aligns with your investment goals and risk tolerance. While past performance is not a guarantee of future results, analyzing historical returns and comparing them to industry benchmarks can provide insights into the fund’s performance. It is advisable to review your MPF fund performance at least annually or whenever there are significant changes in your financial situation.
Is it possible to transfer my MPF account to another trustee?
Yes, it is possible to transfer your MPF account to another trustee. This can be done when you change jobs or when you wish to consolidate your MPF accounts. You should contact the trustee of the MPF scheme you wish to transfer to for guidance on the transfer process. It is important to consider factors such as fees, investment options, and customer service when choosing a new trustee for your MPF account.
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