SEOUL, Sept. 21 (Korea Bizwire) – A new survey has revealed that most South Korean financial consumers still prefer safer choices such as installment savings plans, despite low interest rates and a booming stock market.
According to the online survey conducted by pollster NICE R&C with a sample of 19,300 people aged between 20 and 64 in July and August, nearly half of the respondents selected savings and installment savings as their preferred investment strategy, up from 48.8 percent last year to 49.6 percent.
However, the survey also found that the more assets respondents had, the stronger interest they had in real estate investment, reflecting the growing interest in the housing market since 2013.
Of the respondents, 18.8 percent said they preferred to invest in real estate, followed by direct investment such as stocks, which accounted for 11.8 percent, and insurance, which accounted for 10 percent.
Indirect investing in instruments such as mutual funds was next, accounting for 6.7 percent.
While the figure from the same survey for real estate investment has been on a steady rise since 2013, most respondents regardless of their financial assets preferred savings.
On the other hand, the survey also noted that when financial consumers had more assets, they showed a tendency to gear toward direct or indirect investment such as investing in the stock market or real estate.
For instance, 57 percent of those who had less than 10 million won in financial assets preferred savings plans to boost their income, while the figures for housing investment and insurance among the same group stood at 14.6 and 10.1 percent, respectively.
Among those who owned financial assets worth over 100 million won, the figure for those who preferred savings plans dropped to 39.7 percent, while over 21 percent geared towards real estate investment for better profitability.
The figures for direct and indirect investment stood at 18.3 and 10.6 percent, respectively, while the figure for insurance accounted for 9 percent.
“Respondents with fewer financial assets tend to prefer savings plans more,” NICE R&C said.
A sense of ‘regret’was observed commonly among those who had experienced a financial failure in the past, as many of them feared repeating the same mistakes.
The findings from NICE R&C’s survey echo a study released earlier this week by Prudential Life Insurance Company, which showed many older investors share a sense of ‘regret’ after having experienced financial failures in the past, discouraging them from taking risks so as to avoid repeating the same mistakes.