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[THE INVESTOR] The low pension subscription rate in South Korea poses a serious challenge in managing the growing elderly population, according to a local research institute on Sept. 27.
According to the Hana Institute of Finance, the subscription rate for personal and retirement pensions in South Korea is 23.4 percent. By comparison, this is less than one-third the rate in Germany (71.3 percent) and falls far behind other countries like the United States (47.1 percent) and Britain (43.3 percent).
The subscription rate falls even lower as income drops. For those earning less than 20 million won (US$18,034) a year, only 3.8 percent are enrolled in a pension plan.
South Korea’s aging society has raised a worrisome specter of the elderly falling into poverty with no safety net available. The poverty level of people over 65 was 49.6 percent in 2013, more than three times the average for member states of the Organization for Economic Cooperation and Development.
The most recent census released earlier this month showed that the number of people aged 65 and over accounted for 13.2 percent of the entire population, up from 11 percent five years ago. By contrast, the size of the population aged between 0 and 14 decreased from 16.2 percent to 13.9 percent.
(theinvestor@heraldcorp.com)
According to the Hana Institute of Finance, the subscription rate for personal and retirement pensions in South Korea is 23.4 percent. By comparison, this is less than one-third the rate in Germany (71.3 percent) and falls far behind other countries like the United States (47.1 percent) and Britain (43.3 percent).
The subscription rate falls even lower as income drops. For those earning less than 20 million won (US$18,034) a year, only 3.8 percent are enrolled in a pension plan.
South Korea’s aging society has raised a worrisome specter of the elderly falling into poverty with no safety net available. The poverty level of people over 65 was 49.6 percent in 2013, more than three times the average for member states of the Organization for Economic Cooperation and Development.
The most recent census released earlier this month showed that the number of people aged 65 and over accounted for 13.2 percent of the entire population, up from 11 percent five years ago. By contrast, the size of the population aged between 0 and 14 decreased from 16.2 percent to 13.9 percent.
(theinvestor@heraldcorp.com)
