South Korean President Yoon Suk Yeol has announced plans to reform the country’s pension fund system, citing the challenges posed by the low birth rate and aging population. With a birth rate of 0.72 per woman, well below the replacement rate, the fund is at risk of depleting rapidly without enough new contributors. The current pension system has also faced criticism for not adequately supporting the elderly and lacking the trust of the younger generation. The country’s pension fund, valued at over 1,113.5 trillion won, is projected to cease growth by 2041 and be depleted by 2055. President Yoon aims to create a more sustainable system that ensures fairness across different generations and restores trust in the National Pension Service. A recent poll showed that nearly 40% of Koreans in their twenties and thirties believe the system needs reform to secure their future pensions. President Yoon plans to make reforms that are acceptable to the younger generation, who contribute the longest and pay the highest premiums, yet are the last to receive benefits. He also proposed extending credit benefits to individuals who have children or complete military service to avoid gaps in pension subscription periods. The proposed reforms seek to address the challenges faced by the pension system and ensure its long-term viability.
Source
Photo credit www.hindustantimes.com
South Korean president suggests changes to pension fund system | Global Updates
