Scheme members should pay attention to the following points before making a decision on how to manage their MPF :
Consider personal needs
Members should consider the amount of personal assets they have and their daily needs after retirement. For instance, whether they will be in need of cash to cover their daily expenses or for other purposes.
Understand how MPF funds work
MPF is invested in MPF funds and the price of fund units will change according to market fluctuations. As such, the value of MPF held by a scheme member is determined by the current market price of the MPF funds.
When scheme members withdraw their MPF, trustees will sell their fund units in their accounts at the current market price and pay the relevant amount to the scheme members. As it takes time to process the withdrawal applications, the fund price may vary subject to market fluctuations. As a result, the final price of the fund units may differ from the price when the withdrawal application was made.
Understand the rules for withdrawing voluntary contributions
Withdrawal of MPF derived from voluntary contributions is subject to the governing rules of the scheme concerned. If scheme members have voluntary contributions in their accounts, they should contact their trustees for the withdrawal rules for voluntary contributions.
Be aware of the conditions associated with a guaranteed fund
If scheme members have invested in a guaranteed fund, they should check whether withdrawal in a lump sum or by instalments will result in the failure to fulfil certain qualifying conditions, such as the minimum investment period. If scheme members make withdrawal before the expiry of such minimum investment period, they will not be eligible for the guaranteed returns.
Timely review of fund choices
MPF that are not withdrawn will be kept in the account for further investment. Scheme members should regularly review their investment portfolio, and consider whether they need to make any adjustments.
Be aware of investment risks
Regardless of whether scheme members choose to withdraw their MPF by instalments or retain them all in their accounts, any MPF not withdrawn will continue to be invested. The value of these assets may change due to market fluctuations.
In addition, members’ accounts will be subject to management fees and other charges by the trustees as usual based on the total value of MPF assets in the members’ accounts.