【Stress-free self-managed “Premium” surrender】Beyond cashing out, you can still plan right up to retirement!

“Living to a hundred” is no longer a fantasy. There are over 10,000 people aged 100 or above in Hong Kong¹, and “how to enjoy one’s later years” is surely a topic that gives everyone much to think about. Longevity is certainly a blessing, but the challenges of daily life cannot be overlooked. Even if you have an MPF lump sum as your retirement nest egg, if it is not used wisely, it will still be difficult to reliably cover all your expenses. The earlier you plan for retirement, the better of course. However, even once you have reached retirement age, by choosing the right financial tools and making good use of your capital, you can not only enjoy a steady monthly income, but also receive considerate elderly care, allowing you to live your later years as you wish, with peace of mind and comfort.

Almost everyone will retire, but not everyone prepares for retirement early. According to the findings of Sun Life’s report, Planning for Retirement: Facing the Future with Confidence², 28% of retired respondents admitted that they had not planned for retirement expenses, and 11% of retired respondents said they were caught off guard by costs higher than expected. Entering the second half of life with no planning at all, the pressure they face is imaginable.

The survey also found that local respondents were well aware of the importance of financial security in later life. However, 46% said they would only start planning for retirement expenses within five years of retirement or less; even more concerning, 17% of respondents had no plan at all for retirement expenses. For those approaching retirement, having missed the golden period for accumulating wealth, what viable options are there beyond retiring with no financial cushion?

“Immediate annuity” is a financial product designed specifically for those nearing retirement and already retired, with the aim of creating a self-made retirement income stream. Policyholders can choose to pay a single premium, for example by making good use of MPF as the capital. Thereafter, they will receive a guaranteed and fixed monthly annuity income, turning the fruits of many years of effort into a continuous cash flow until the end of life. Policyholders should also consider whether inflation may increase future expenses and affect their retirement quality of life. In addition to an immediate annuity, they should also set aside reserve funds. Sun Life RetireFree Immediate Annuity* is a basic plan that provides guaranteed lifetime income, while RetireFree Care is an optional participating rider³ that offers non-guaranteed potential returns and comprehensive protection (collectively, “RetireFree Immediate Annuity and Rider”), helping to ease living and medical expenses and enabling a worry-free retirement. This integrated solution provides an all-in-one lifetime retirement solution that comprehensively addresses the three core needs of the silver generation:

• Financial stability for retirement living
• Long-term care support for later life
• Asset planning for intergenerational wealth transfer

This plan not only provides a continuous guaranteed cash flow, but by selecting the optional rider RetireFree Care Rider³, you may also lock in up to 10% of non-guaranteed terminal dividend each year as early as the 3rd policy year⁴, and may choose to accumulate it with a non-guaranteed annual interest rate of 3.5%⁶. You may also withdraw the accumulated amount at any time, providing support in multiple ways for retirees to meet the challenges of life’s second half.

Sun Life understands the challenges faced by retirees, including cash flow, inflation eroding purchasing power, and the threat of critical illness. RetireFree Immediate Annuity and Riders² not only provides policyholders with a steady stream of guaranteed cash flow, but also offers greater flexibility in financial arrangements, helping the silver-haired generation meet the challenges of the second half of life, while also enabling wealth transfer so that future generations may benefit.

1. A steady stream of guaranteed cash flow, with an optional rider³ and dividend lock-in option

“Living off savings will only deplete them over time” is a major source of stress for retirees, and after retirement, relying solely on MPF is often insufficient to meet a range of needs, including day-to-day expenses, healthcare and protection against inflation. If savings are placed into the RetireFree Immediate Annuity Basic Plan to create a personal pension, the effort invested day after day in the past can be turned into peace of mind day after day in the future. Policyholders will receive annuity income in the month following policy inception, with guaranteed monthly annuity payments for life. They may also choose to receive the annuity payment monthly or deposit it into the “Interest-Crediting Account”⁶, which functions like a current account, allowing funds to roll over and earn interest at a non-guaranteed annual interest rate of 3.5%.

The optional rider, RetireFree Care Plus Rider³, has a market-leading feature: from as early as the 3rd policy year, policyholders may lock in up to 10% of the terminal dividend⁵ each year. They can likewise choose to receive it directly or deposit it into the “Interest-Crediting Account”⁶, which functions similarly to a current account and earns interest at a non-guaranteed rate of 3.5% per annum, giving retirees the flexibility to seize market opportunities and enjoy the fruits of their savings sooner.

2. Flexible withdrawals to help offset inflation

As inflation continues to rise year after year, expenses seem only to increase, and retirees inevitably worry about diminishing purchasing power. If an elderly retiree has only an MPF account and no further means of enhancement, purchasing power will only continue to decline, and they may even face financial hardship. By investing capital into the Silver Years Immediate Lifetime Annuity Plan, policyholders can benefit from flexible financial arrangements that help “self-generate” more retirement income to address this situation.

In addition to a stable cash flow, amounts accumulated in the “Interest-Crediting Account”⁶ may be withdrawn at any time by the policy owner through SunWallet, according to personal needs, allowing for flexible responses to different situations. Assuming an inflation rate of 3% per year, the policy owner may choose to increase the withdrawal amount by 3% annually to help counter inflationary pressure and strengthen cash flow. Such withdrawals are limited to the amount in the Interest-Crediting Account and will not be regarded as a partial surrender. SunWallet also offers an overseas transfer service, enabling easy transfers to overseas bank accounts⁷ even when abroad, making the withdrawal process simple and flexible.

3. Critical illness and specified neurological conditions protection

As people age, health issues may become more frequent and the threat of critical illness may also grow. Yet it is not easy for the silver-haired generation to purchase medical and critical illness insurance, and relying on MPF alone makes it difficult to meet long-term medical expenses, not to mention protection for life after recovery. The RetireFree Care Plus Rider³ is a pioneering annuity product that provides flexible financial arrangements and additional protection against specified critical illnesses, offering both short-term and long-term protection.

If the policyholder unfortunately suffers a stroke, is diagnosed with cancer, heart disease, stroke, dementia, Parkinson’s disease, or loses some degree of ability to live independently, they may apply to lock in 50% of the then terminal dividend⁵ cash value, up to once per diagnosis and up to 5 times per policy, without reducing future guaranteed monthly annuity payments. In addition, from the 3rd policy anniversary onwards, if the policyholder is diagnosed with dementia or Parkinson’s disease before age 80, they will receive additional compensation for up to 10 years, with the annual amount equal to 10% of the face amount of RetireFree Care Plus, subject to a maximum of US$50,000 per year.

4. Proper end-of-life arrangements and early legacy planning

In the retirement plans of the elderly, beyond living and medical expenses, end-of-life arrangements are also a concern. RetireFree Immediate Annuity and Riders³ not only protects retirement life, but also enables the elderly to make positive arrangements early for end-of-life matters and post-death planning, realising the concept of “passing on great significance through self-transfer”. The plan’s death benefit, together with annuity payments already made, is guaranteed to be no less than the single premium paid, so policyholders need not worry about losing their principal upon death.

The plan also thoughtfully provides the “Legacy of Life Benefit”, extending care to the very last moment of life. If the life insured passes away, the beneficiary may claim reimbursement of the funeral costs incurred for the life insured, up to 25% of the face amount of RetireFree Care Plus³, subject to a maximum compensation limit of US$62,500 per year. This is the first of its kind in the market⁸, helping the life insured’s family members with the deceased’s final arrangements. Furthermore, if accidental death occurs before age 85, RetireFree Care Plus³ will provide an additional accidental death benefit equal to 50% of the face amount of the supplementary benefit.

Suppose Mrs Li retires from the workforce at the age of 60. At retirement, she has US$250,000 in retirement savings, of which she then allocates US$200,000 to 永明享悅即享年金, and the remaining US$50,000 to 享悅添心附加保險³, with the aim of covering her daily living expenses and leaving a financial legacy for her son upon her death.

Under the plan, through the guaranteed monthly annuity payments⁶, Mrs Li will receive US$833 per month for life from the first policy anniversary, which is equivalent to 5% of the basic plan’s single premium per year. At the end of the 3rd policy year, the plan will begin to declare terminal bonuses⁴; by the end of the 11th policy year, the "Expected Total Surrender Value + cumulative guaranteed monthly annuity" will exceed 100% of the total premiums paid. By the end of the 25th policy year, the "terminal bonus⁴ cash value + cumulative guaranteed monthly annuity" will exceed 200% of the total premiums paid, with the cumulative guaranteed monthly annuity reaching US$250,000, while the terminal bonus⁴ cash value will reach US$263,959. Even if Mrs Li passes away in the future, she will still leave a substantial financial legacy for her son.

Retirement is a transitional stage in life, bringing both challenges and anticipation. As you embark on this new chapter, choosing a suitable immediate annuity plan for yourself offers not only tangible returns, but also peace of mind.

Notes:
¹ Source: 2021 Population Census results https://www.census2021.gov.hk/en/main_tables.html   
² Sun Life Financial - “Planning for Retirement: Facing the Future with Confidence” - October 2024
³ This optional rider can only be applied for together with the basic plan at the time of application. Please note that JoyFulfilling Plus cannot be purchased separately or added later.
⁴ Terminal dividend is non-guaranteed and is determined from time to time under the rules specified by Sun Life Hong Kong. Terminal dividend may vary based on the performance of a number of experience factors, with investment return generally regarded as the principal determinant. Other factors include, but are not limited to, claims experience, policy expenses, taxes and policyholder persistency. The cash value of the terminal dividend may not be equal to its face value. Terminal dividend may differ each time related dividends are declared in the future, and the actual amount paid will also vary. For details of the dividend, please refer to the Dividend Philosophy section under Important Information and the Sun Life Hong Kong website (www.sunlife.com.hk).
⁵ The application to exercise the terminal dividend lock-in option must be submitted within 30 days before the policy anniversary date, and can only be exercised once in each policy year. Once your application has been approved, it cannot be withdrawn or changed. After exercising this option, any locked-in terminal dividend amount will be deducted when calculating the death benefit under JoyFulfilling Plus.
⁶ The accumulated rate for the Everyday Interest Account is not guaranteed and is determined solely by Sun Life Hong Kong Limited (“Sun Life Hong Kong”) and may be changed from time to time. Up to 31 October 2025, the prevailing rate for the Everyday Interest Account is 3.5% per annum.
⁷ Overseas transfer service is an administrative service provided by third-party banks/service providers. This service is not guaranteed, and we may amend or terminate it without prior notice. The overseas transfer service is subject to applicable laws, regulations and the guidance issued by the regulators of the relevant jurisdictions. We are not responsible for any acts, omissions or negligence of the relevant third-party banks/service providers. We shall also not be liable for any loss or damage, costs or other expenses arising directly or indirectly from or in connection with this service.
⁸ The “market first” description of this product feature is based on a comparison as at 22 August 2025 with immediate annuity plans for new business policies provided by insurers authorised by the Insurance Authority and operating composite business and long-term business.

*The Joy Immediate Annuity Insurance Plan and the offer are subject to terms and conditions. For details of the product features and risks, please refer to the product brochure and leaflet, or contact your financial adviser.
This advertising material is sponsored and provided by Sun Life Hong Kong for general reference only. The product information above does not contain the full policy terms and is subject to the terms and conditions of the relevant plan. For details of the above product features, benefits and the full terms, exclusions and key product risks, please refer to the Sun Life Hong Kong website, the relevant product brochure and the policy terms. Any promotional offers or marketing materials should be read together with the relevant product brochure. Customers must successfully complete the financial needs analysis to confirm that the insurance product recommended meets their insurance needs.

Last updated: 21 November 2025.

This English version of this article has been generated by machine translation powered by AI. It is provided solely for reference purposes. In the event of any discrepancy or inconsistency between this translation and the original Chinese version, the Chinese version shall prevail.