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Pension reform options in Hong Kong
Author(s)
Date Issued
2018
ISSN
1052-3073
Citation
Journal of Financial Counseling & Planning, 2018, vol. 29(2), pp. 245-258.
Type
Peer Reviewed Journal Article
Abstract
This article argues for the establishment of a defined benefit and partially funded universal pension system. The characteristics of this system represent a publicly managed mandatory contributory pension plan and the coverage of its benefits for all Hong Kong elderly aged above 65. By applying a mathematical model which links up the periodic savings during people's working life, level of interest rates, average length of time in retirement, and the amount of retirement benefit payments, we calculated the possible scenarios for Hong Kong to reform its pension system. Research results suggest that the proposed system will be financially viable and sustainable provided both the government and its citizens are willing to pay for it.
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