Gen X, it’s not too late to start investing in your 40s
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Gen X, it’s not too late to start investing in your 40s

5 Jan
26 Sep
  • It is never too late to invest, even for Gen X investors who are in their 40s and 50s. The average life expectancy in Hong Kong is 81 for men and 87 for women — Gen X investors still have a considerable investment time horizon of three to four decades.
  • Understand what you’re investing for. Money goals at this stage of life may include preparing for retirement, setting up a university fund for their kids or building a caregiving fund for elderly parents.
  • Types of investments Gen X can consider include globally diversified portfolios such as the Endowus Global model portfolios, Endowus Passive Income model portfolios and Endowus Cash Management model portfolios.
  • To get started with your wealth journey on Endowus, click here or schedule a 1-on-1 consultation with our licensed client advisors by emailing

It is never too late to start investing — no matter your age and the stage of life you’re at now. What’s most important is to get started. Investing can benefit us at all stages of life.

Here’s how you can start your investment journey with confidence — be it from the age of 20, 40, or 60. Invest today to take advantage of compounding returns as soon as possible.

In this article, we provide some tips for the Gen X investors, currently in their 40s and 50s out there.

Why should we invest?

Life is getting more expensive. Savings alone are not sufficient to manage inflationary pressures — where a dollar tomorrow is not worth the same as a dollar today.

This is especially important for people who are part of the sandwich generation and face high living expenses as they care for their children while supporting elderly parents.

If you have children, investing now can also help secure their financial futures. For instance, one of your investment goals may be to set up an education fund for them.

Am I too old to start investing?

If you did not manage to start investing when you were younger, you might wonder whether you have missed the boat. The simple answer is no.

As the adage goes: While the best time to plant a tree was 20 years ago, the second best time is now.

In 2022, the life expectancy of Hong Kong citizens is 81.3 years for men and 87.2 years for women. If you’re Gen X — currently in your 40s and 50s — you still have a considerable time horizon of about three to four decades — for which there remain many investment opportunities that may suit you. You will also need to maintain your long-term purchasing power even through retirement.

The table below illustrates how even a small sum invested every month can grow to a substantial amount over time, with the power of compound interest. 

An example of how your monthly investments could grow

Besides, plenty of investment options exist for shorter time horizons. This will depend more on your life goals, rather than your age. Examples of short or mid-term financial goals include down payment on a home, building up an emergency fund, or saving for a family vacation.

Therefore, it is crucial to think about why you’re investing. Depending on how much risk you can handle and the time horizon of each of your goals, the investments you select and how you build your portfolio will vary.

Take stock of your financial situation

To kick things off, take a close look at your personal finances, as well as your family or household finances.

As a start, here are some factors to assess:

  • Income: Calculate your total monthly income from all sources, net of MPF contributions and taxes. 
  • Expenses: How much are you spending each month? Do you have any big-ticket expenses coming up? Break down your spending into needs versus wants. You may wish to apply the 50-30-20 rule to budget your take-home income — up to 50% for needs, 20% for savings and debt repayment, and 30% for wants.
  • Debt: Evaluate all your outstanding loans and the accompanying interest rates. Check out our guide on creating an effective debt repayment plan.
  • Emergency fund: Do you have sufficient rainy day savings? Experts generally recommend having an emergency fund that covers at least three to six months’ worth of expenses. Pick up tips on how to save more money. 
  • Insurance: Review your insurance needs. Do you have enough insurance coverage for yourself, your dependants, and your assets? Make sure you are not over-insured and paying premiums through the nose. When it comes to your investment portfolio, it’s a good idea to look beyond insurance policies.
  • Retirement plan: Review your retirement plan at least once a year and track your progress. If you have not begun planning for your golden years, here’s a simple retirement checklist to kickstart the process.

Which stage of life are you at?

Your financial needs, priorities, and goals tend to change across different phases of your life.

As a Gen X investor, you are likely at your mid-career point and your peak earnings years. At the same time, you may be part of the “sandwich generation”, juggling the competing financial demands of your children and your ageing parents.

For most Gen X investors, their portfolios at this stage of life can include higher-risk assets with the potential for greater returns, given that they still have a runway of a couple more decades until retirement.  

That said, it is also possible for some individuals to face setbacks as they get older, which will, in turn, affect their financial circumstances and plans — such as a chronic medical condition, or having to take time off from work to care for ageing parents.

Some individuals at this life stage will therefore want to start taking on more low-risk and low-volatility investments. For example, they could reduce the proportion of stocks in the portfolio while slightly bumping up the allocation to high-quality bonds as well as medium-risk to low-risk funds.

Set clear financial goals, and prioritise them

Your money goals should be personalised to your life. Map out your core life needs and goals, as well as the accompanying time horizons, so that you are clear about why you should own certain asset classes and adopt certain investment strategies.

When you invest with a defined purpose of achieving a certain goal, you can better identify:

  1. How much you need to invest;
  2. The best investment strategy for you; and
  3. The appropriate level of risk you should take to get you there.

Money goals will vary from person to person. For Gen X investors, typical goals may include:

  • Emergency fund
  • University fund for kids
  • Parents’ medical and caregiving fund
  • Home down payment and renovation
  • Family vacation
  • Retirement

To learn how you can better prioritise your financial goals, check out this article.

The chart below illustrates how an individual might allocate their money in different objective-driven portfolios based on each goal. Learn more about investing your first $100,000 here.

Source: Endowus

What are the investment options available?

If you’re starting to invest later in life, there are plenty of options out there to explore. Your strategy should match where you’re at now — including your goals, financial circumstances, and risk tolerance. 

For example, for a shorter time horizon and lower risk tolerance, it may be worth considering investments that are low risk, less volatile, and prioritise capital preservation, such as bond funds. These can make up a higher proportion of your overall portfolio, with lower exposure to equities, for a more conservative asset allocation.

And if earning passive income is key, there are income funds and portfolios that offer monthly payouts while growing or preserving your capital.

To take the stress out of investing, opt for a passive approach — by buying funds that track market indices — which enables you to earn returns similar to those of the indices. 

Consider, too, advised portfolios built by experts in the Endowus Investment Office and designed for your unique risk tolerance, investment needs, and wealth goals.

Regardless of your life stage and goals, it’s always a good idea to keep your investing costs low and make sure your overall portfolio is well-diversified. 

Types of investments to consider

Global model portfolios:

Despite many tumultuous episodes, time in the market is more important than timing the market. Even the worst investor in the world can do well over the long run. A person who invests at the peak of the market in every decade from 1970 to our present day would still have had an annualised return of almost 9%, just by having his money grow in the market.

The question is, how should you be invested? We often hear of worries that investing in the stock market feels like gambling because stock picking has such random outcomes. It is true that buying and selling single stocks or sectors and even countries or regions can be exciting, but it can lead to unpredictable returns.

Endowus uses scientific research sharpened by decades of empirical data that tells us there is no need to try to beat the entire market. Instead, look at the market indices that represent the performance of the overall markets — the broadest global benchmark is the MSCI All Country World Index (ACWI) — and buy portfolios with funds that track their performance. 

The Endowus Global model portfolios are designed to give investors broad exposure to global markets in a strategic and passive asset allocation. This is opposed to a tactical — or short-term and opportunistic — allocation. Our allocation strategy for core portfolios such as the Global model portfolios means that we largely track the global indices over time.

This portfolio should form the core of your total investment. Investors may want extra exposure to a specific market, theme, or sector. Perhaps you’d like to buy some direct exposure to the growth of clean energy, the global property market, and/or to China. That would mean a tactical allocation through a satellite portfolio.

  • Core portfolios on Endowus: Our Global model portfolios are built with Best-In-Class, low-cost funds from leading global fund managers. Select from a varying mix of equities and fixed income to suit your risk tolerance and return objectives — including 100% fixed income for very conservative investors, and 60% equities and 40% fixed income for those who want a balanced portfolio. Learn more about them here.
  • Satellite portfolios on Endowus: Our Satellite portfolios are optimised, Best-In-Class portfolios designed by Endowus to target your favourite regions, themes, asset classes, and trends. Choose from four portfolios, including Future Trends and Global Technology.

Bond funds, dividend stocks and funds, or multi-asset income portfolios:

Fixed income, or bonds, are generally considered less risky than equities, or stocks. They may also be able to provide a stable income stream. Bonds often act as diversifiers to stocks and are shock absorbers within portfolios, cushioning the losses when stocks are down. 

Note that there are different fixed income sectors with varying credit quality and risk and therefore coupon rates — ranging from government bonds and investment-grade corporate bonds from blue-chip companies, to high-yield bonds which have a higher risk of default.

Investing in dividend-paying stocks is also a popular way to generate a source of passive income while enabling potential capital appreciation. Besides investing in single dividend stocks, you can also consider investing in dividend-yielding funds that offer diversified exposure to various sectors or geographies and can help create a more robust portfolio. 

For those who want to hold bonds with equities, you can look at multi-asset income portfolios that provide exposure to both asset classes.

  • Advised portfolios on Endowus: Our Passive Income model portfolios are passive income solutions designed for every stage of life. Receive monthly payouts while growing or preserving your capital, through portfolios focused on income, dividends, and stability.
  • Single funds on Fund Smart: Prefer to customise a portfolio with your favourite funds? Check out our curated list of bond funds, which include some of the higher-yielding funds like the AllianzGI Income and Growth Fund, and PIMCO GIS Income Fund.

Cash management solutions:

Instead of leaving your cash idle in a low-yielding savings account, you can earn higher yields with low-risk money market or liquidity funds, while getting easy and flexible access to the money in case you need to withdraw it for more immediate needs. 

  • Advised portfolios on Endowus: Our Cash Management model portfolios are tailored to your risk tolerance and help you access the best cash, money market, and short-duration bond funds in the industry, at the lowest cost achievable.
  • Single funds on Fund Smart: Prefer to customise a portfolio with your favourite funds? Key cash management funds available on our platform include the E Fund HKD Money Market Fund and GaoTeng WeInvest HKD Money Market Fund. Check out their latest yields here.

As with all investments, investors are reminded that putting your money into investment funds comes with some degree of risk and that the capital protection and yields are not guaranteed.

Simple ways to start your investment journey today

Investing can be simple, accessible to everyone, fair, and come with low costs. With Endowus, you can grow your wealth and reach your goals effortlessly with evidence-based strategies.

Start small, and automate for peace of mind

If investing a large chunk of your savings seems daunting, start small. Even with a modest amount of money in your pocket, there are ways to begin investing effectively. Passive index funds, for example, are a good starting point for investors with limited capital. On Endowus, you can start investing from just US$100 or HK$500.

One of the easiest ways to build your investment portfolio over time is to set it and forget it. Decide how much you want to sock away each month, then set up an automatic, recurring monthly contribution from your account. This is also helpful if you wish to do dollar-cost averaging (DCA).

Invest like an expert with Best-In-Class Funds

If you’re new to investing, consider the Global model portfolios, which are made up of investment funds that are handpicked and monitored by our Investment Office. The portfolios are globally diversified and come in six risk levels you can choose from — including 100% equities, 100% fixed income, and 60% equities and 40% fixed income.

Depending on your investment goals and risk tolerance, you can also consider other expert-advised portfolios, such as Passive Income for different types of passive income and Cash Management for short-term liquidity management.

Get personalised, expert advice for your goals

Endowus' client advisors have years of experience advising clients from all walks of life, including first-time investors, professionals and business owners. They are all licensed with the Securities & Futures Commission of Hong Kong (SFC), and are here to help so that you can achieve your goals.

Click here to schedule a 1-on-1 consultation or email them (, or join a virtual session on how to get started or navigate the Endowus platform.

Take your first step today

Many individuals have apprehensions about investing later in life. But there is no such thing as being too old to get started. Whether you’re a fresh graduate, in middle age, or nearing retirement, there are suitable investment options for you to consider — depending on how much risk and volatility you can tolerate, and what goals you want to achieve.

To get started on Endowus, click here

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Investment involves risk. Past performance is not an indicator nor a guarantee of future performance or returns. Projected performance or returns is not guaranteed to materialise. The value of investments and the income from them can go down as well as up, and you may not get the full amount you invested. 

Rates of exchange may cause the value of investments to go up or down. Individual stock performance does not represent the return of a fund.

General risk warnings relating to collective investment schemes 

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Funds are not a bank deposit and not capital guaranteed, and is subject to investment risks, including the possible loss of the principal amount invested.  

Some of the funds also involve derivatives. Do not invest in them unless you fully understand and are willing to assume the risks associated with them.


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