A new generation with a singular ambition

Kim Kook-hyun (28) Author of the talked-about book, “20-Somethings, Become Rich.” Plans to quit work by his mid-40s, when he should be wealthy enough.

Choi Gwang-sik still remembers the dumbfounded look on his girlfriend’s face when he said that he wanted to buy a house in a quiet suburb of Seoul as an investment.
“I had heard from a real estate broker that the [price of land] northwest of Seoul was going to leap,” Mr. Choi said. Unfortunately, his girlfriend disagreed and the couple argued about it for a long time.
Their debate is typical of the issues faced by many well-established couples who are financially smart. But Mr. Choi is 28, and his girlfriend is 26, and they have both been out of college less than two years. In the past a couple in their age group would have been more concerned about what car to buy, such a purchase being more suitable to their status as novices in the job market. But Mr. Choi says things have changed and that he is “very normal” for his age. These days many people in their 20s think real estate is the best investment tool.
“One of my cousins, my age, bought an apartment that was auctioned off last year and that house [value] soon jumped,” he said. “That’s what I call a smart financial move.”
Buying a house, which has long been the dream of most couples, was once all but unheard-of among young people, especially when the country was embroiled in an economic crisis. Instead they had to start by leasing a small apartment and saving up until they could afford to live in a bigger one and possibly purchase one later. But the recent huge increase in housing prices, rents and jeonse ― the deposit or “key money” ― has discouraged young people. Many say they no longer dream of owning a house. Now young people joke that a person who owns a house (or has one to inherit) is more attractive on the dating market than a person who graduated from an Ivy League university or has a good job.
Last summer, matters went from bad to worse. The government announced new real estate policies aimed at curbing speculation. Ironically, the cost of housing in Seoul’s affluent districts rose nearly 7 percent. It was good news for the haves but a tragedy for the have-nots.
Shin Ho-jong, 27, experienced this problem in a painful way. Last year, before he enrolled in the graduate school of business administration at Seoul National University, he had earned some money by giving English essay tutorials to middle school and senior high school students who wanted to enter elite schools in Korea or overseas. The pay was good and he collected enough money to buy a miniscule office in Daechi-dong, in the affluent Gangnam area of southern Seoul. He planned to use it to open a private English language institute with two of his colleagues. But after another real estate policy aimed at freezing apartment prices was announced, the price of office buildings in Daechi-dong jumped higher and the office he had earmarked increased in price to 17 billion won, more than twice what he had been prepared to pay.
These price jumps in the real estate market have made this generation of young people more aware of the need to make big money fast. After all, the real-estate train has already left the station. They are going to need an investment vehicle that moves even faster in order to catch up.
According to a representative survey of 367 college students conducted last month by Powerjob.com, a recruitment Web site for young people with professional aspirations put improving their ability to make successful investments ― in Korea this skill is called “financial technology” ― over what they will do for their future jobs.” The survey said that more than 40 percent of college students believe that the best way to earn fast money is through real estate speculation. A little less than 30 percent said they invested in mutual funds, 14 percent said they still relied on putting their extra cash in a savings deposit account and 9 percent said they traded stocks.
Riding on this wave of speculative investment, “how to get rich” books that target people in their 20s have been filling the bestseller charts. The books suggest that young people have a better chance of getting rich quick than the older generation, especially if they use financial technology wisely. Many of the “instant wealth” books have irresistible titles such as “Korean 20-Somethings, Go Mad for Financial Tech,” (Hans Media) and “How the 20s Can Power Up Your Financial Tech, Starting with Just 1 Million Won” (Pampas).
Park Ji-youn, 25, a nutritionist, has been delving into these books for months. In her bag were “How to Make Big Money” by Jung Cheol-jin and “20-Somethings, Become Rich” by Kim Kook-hyun.
“My goal is to make about 80 million won ($85,000) within five years,” she said. “I would need more to buy a house but it’s a good start to make a tidy sum of money first.” She has been putting her money in mutual funds “like all her girl friends” and recently subscribed to an online dating agency that will help her to meet a spouse who is consistent with her standards, especially regarding financial status.
Jeon Jeong-min, 24, is the kind of girl the authors of the series, “Girls, Get Smart with Money,” probably consider to be “smart.” Ms. Jeon is still in school, but she has a cash management account, a long-term housing savings account, uses a debit card instead of a credit card and invests in mutual funds (Although none of her friends know about this). She said she learns about economics from financial newspapers.
“I think I should have at least 2 billion won when I am mid-aged,” she said. “No, let me correct that. I’d say 5 billion won would be the right amount to be thought of as a person who had succeeded in financial-tech.”
Ms. Park and Ms. Jeon are both members of the “Rich 20s Community,” one of the most popular Web sites encouraging people in their 20s to make more money by being smart. The Web site is run by Kim Kook-hyun, the author of “20-Somethings, Become Rich.” He is also in his 20s.
“You would not believe how people in their 20s have so much more interest nowadays in enhancing their finance-tech,” said the 28-year-old author and the head of FNQueen.com, an online agency that specializes in giving financial counseling to young women. “Many used to think that it was shallow for young people to have an early interest in wealth, but I think that’s now a useless stereotype.”
“I tell people of my age they need to be honest about their goals and be organized to get what they want, whether that’s buying a house or just becoming rich,” he said. “And I thought my Web site could be a place where people can share such information freely.”
There are over 90,000 people enrolled on his Web site at the moment. Park Hyung-keun, 29, a financial consultant, is one of the site’s voluntary advisors. He answers questions like, “What should I do with the first 500,000 won I have saved?”
“I advise them not to be afraid of going to financial institutions, even banks, and asking them as much as they can about what their best choices are,” he said. “A lot are shy [about going to banking agencies for professional counseling] since those in their 20s do not have a lot of money to start with.”
All those interviewed for this story seemed to be wise and knew the best way to save money, but have they reached their ultimate goal of buying a house? The answer was, unfortunately, “No.”
“I don’t think that any person in their 20s would open up easily and say that they have a house in their name, even if they do,” said Mr. Kim, laughing. “It’s not only the cold reality that’s making it impossible [for a young person to own one], but I am sure it is important for a young person to look as though they are trying their best to work harder to make and save more money.” In other words young people who already own a house are thought to be the beneficiaries of “easy money,” and their friends and employers would think they have no worries in the world.

By Lee Min-a Staff Writer [mina@joongang.co.kr]