Only 4 out 10 Koreans registered under National Pension: report
Only four out of 10 South Korean individuals from low-income brackets were registered under South Korea’s national pension scheme, according to the latest report on Sunday, raising concerns on elderly poverty which currently stands at the highest level among the OECD countries.
According to the NPS research released on Sunday, as of 2021, those aged 20-59 earning less than two thirds of the median income logged a 40.96% registration rate. The figure marks a mere 2.15 points percent rise from 2009. Meanwhile, those middle income earners, defined as earning between over two-thirds of and over 1.5 times more than the median income, logged 78.09 % registration rate. Top- earners, defined as those making over 1.5 times more than the median income, logged 80.46% registration rate. The figure marks 13.62% and 6.84 % rise from 2009, respectively.
As the national pension system fails to address the welfare blind spots, the report also showed that the poverty rate tends to rise with age. The poverty rate, defined as the disposable income below 50% of the median income, declined to 37.71% in 2021 compared to 49.18% in 2009. However, the poverty rate for those over 85 rose by 4.21%, from 48.23% in 2009 to 52.44%.
The research also stated that under the current scenario of paying 300,000 won to the senior citizens, the poverty rate will gradually decline from the current level of 37.71% to 25.76% in 2070. But it will rebound to 30.53% in 2093. Even if the payout is raised to the 400,000 won range, the poverty rate will only decrease in the range of 0.58-1.57 % points, the report said, adding that raising the payout will have limited effects.
Meanwhile, in a separate report, those aged 45-64 who responded that are not financially ready for their post-retirment life logged over 40%. According to the report, 26.7% of those surveyed suffered economic burdens and stress from taking care of their family members. Those who responded that they did not prepare for their post retirement life was at 43.0% and those who simultaneously face the burden of caring for their family members and are not ready for post retriment life was at 12.5%