New research shows older Koreans are being squeezed between the cultural obligation to provide for their adult children and the rising cost of marriages and housing in South Korea.
Net assets held by Koreans age 63-68 have shrunk by approximately one third over the past six years, while those held by every other age group have risen. At the same time, the rate of people age sixty and above who are finding employment is rising five times faster the overall rate. Commentaries online and in the news blame the financial desperation among retired Koreans on their obligation to pay for their children’s expenses long after their offspring have become adults. Netizens condemned adults who are relying on their parent’s savings, but also criticized parents who failed to get their children to stand on their own feet.
Article from Hankook Ilbo
Seniors in their sixties spend life savings on their children’s marriage
Net assets for senior citizens have declined by one third over the past six years.
Mr. A, 63, (name changed) retired in 2008 from the head of a commercial bank branch. He was confident in his financial future, having received a severance package of ₩300 million won (USD $282,600), which he combined with his other life savings.
Contrary to his expectations, he is now working as a temporary employee at a debt collection agency belonging to the bank he had worked for.
“I spent close to 300 million won on the marriages of my son and daughter, including what they needed as down payment for a house and dowry. With no income generated, I has spent 500,000 won per month to keep a decent life. What only left with me in a 30-pyeong (approximately 100 square meters) apartment.
Seniors in their sixties or older in South Korea now give support to their adult children at the cost of spending on their own retired life.
Retirement cut off the source of income for those seniors, and they see their wealth dropping ₩25 million a year on average as their grown-up children, even those with jobs, are financially dependent upon their retired parents.
A report entitled “The Employment Trend of Seniors in South Korea and its Implications”, released on October 7 by the Korea Labor Institute found that the average net assets possessed by seniors in the 63-68 age range has plummeted to ₩263.73 million, down approximately ₩150 million from ₩417.91 million six years ago.
Converted on a yearly basis, the net assets surveyed dipped by ₩25-30 million, which is equivalent to an one-third decline in six years’ time.
People in their early forties in 2006 saw their assets increase ₩44 million from ₩249.97 million over the past six years, while the group aged 45-50 also acquired more than ₩50 million in assets.
Lee Jun-woo, a professor at Hanbat University, said, “those in their late sixties are facing retirement without systematic preparation. A delayed economic recovery forces many adult children to monetarily rely on their parents, putting a big strain on them.”
The significant rise in the employment rate for those aged 60 or older during the past two to three years reflects this change in South Korea,” the professor added.
In fact, the recruitmenr rate for those sixty-years-old and above stood at 38.7 percent as of the third quarter in 2007. But the number rose 1.7 percentage points to 40.7%, more than five times higher than the increase in the entire average employment rate (0.3%) during the same period.
Comments from Naver:
We don’t have to have children as no adult children care about their parents after marriage. Get your children educated until they graduate from high school, then have them pay for their college tuition. It’s long past the point when we should have stopped indulging children.
Grown up children should make money for their own marriage. Relying on their parents for marriage expenses is a real shame.
Let’s care more about parents. What else we can say about it? Take care of your parents. Children should be grateful to the parents who gave birth to them. By the time you realize you have taken advantage of them it’s already too late.
At this point, should I even have a baby? Come on! I would never do that. With money that I would have used to raise children, instead I will do whatever I want to do.
This is so sad!
Despite this article, few people on the streets seem like they are poor. Youngsters strut brand name clothes on the streets and dine at a fancy restaurants. On the weekends, roads are so crowded with cars that I can’t believe these days are hard times.
I think wedding culture in South Korea is wrong. Many people splurge on their wedding saying, “you know, this is the first and last time in my life I will get married.” But that is beyond me. Some couples with young children too easily decide to get divorced, they are just having friction after their lavish marriage. I hope weddings in this country get practical like the ones in the United States.
Comments from Daum:
Parents who pampered their children have only themselves to blame [...]
What a distorted view of reality! The older generation made bubbles in housing prices with their speculation. That makes it hard for the younger generation to buy homes. So parents sells their houses to help their children to get ones.
As Americans do, we need to make children stand on their own feet after their high school graduation, start to enjoy travelling during our retirement and donate our fortune to charity after we die.
What a fucking country! Adult children drive fancy cars while their parents are toiling.
Newly-weds on a tight budget need to start off with a small house and paying monthly rent in order to feel how rewarding it is to save money. Then later they can move into a bigger house. But in this day and age, all newly-wed couples want to start marriage life in a decent apartment. That’s problem. They don’t know the pleasure of saving money for a better living.