More than 7 in 10 South Koreans in their 20s and 30s profess a lack of confidence in the national pension system. (Image courtesy of Yonhap)
SEOUL, Apr. 15 (Korea Bizwire) — More than 7 in 10 South Koreans in their 20s and 30s profess a lack of confidence in the national pension system, citing concerns over population decline and the potential depletion of funds, according to a government study released on April 14.
The Korean Women’s Development Institute surveyed 1,152 people aged 20 to 39 last July, revealing that 75.6 percent of respondents distrusted the national pension scheme.
Distrust increased with age, from 67.8 percent among those 20 to 24 years old to 78.8 percent for those 35 to 39.
Women in their 30s expressed the highest level of skepticism at 80.2 percent, while the least doubtful were women in their 20s at 69.2 percent.
The top cause for concern, cited by 89.3 percent, was the prospect of continually rising premium payments as South Korea’s population shrinks and ages.
Additionally, 86.3 percent feared receiving inadequate payouts in retirement, while 82.6 percent worried the fund could be depleted, leaving them without a pension.
Some 73.3 percent felt the voices of young generations were being ignored in pension reform talks, and 62.4 percent questioned the transparency of how funds are managed.
Despite the widespread misgivings, 56.8 percent admitted to not setting aside separate retirement savings—a figure slightly higher for women at 58.4 percent versus 55.2 percent for men.
The most common reason, chosen by 43 percent, was simply not having considered it, followed by low incomes at 25.2 percent and excessive housing costs at 9.4 percent.
For those preparing alternative income sources, 62.7 percent were using bank deposits and installment savings.
Popular choices also included private pensions at 56.4 percent, investments like stocks and cryptocurrency at 52.2 percent, and occupational pensions at 36.9 percent, with gender divides evident.
The minimum desired monthly retirement income averaged 2.7 million won for men and 2.4 million won for women.
However, 71.7 percent did not expect to achieve the same economic and social standing as their parents’ generation, with this pessimism more prevalent among women at 74.7 percent versus 69 percent for men.
Researchers recommended incorporating younger age groups directly in future reform negotiations, providing thorough explanations to address concerns.
They also called for reforms to better secure post-retirement incomes for disadvantaged populations.
M. H. Lee (mhlee@koreabizwire.com)
