Won billionaires have more money in the property market
These are some of the findings detailed in the Korea Wealth Report 2020, which was published by KB Financial Group Research Institute. The institute considers a person with one-billion-won ($886,000) worth of financial assets or above to be rich.
The number of wealthy Koreans has been constantly increasing. As of 2019, about 354,000 Koreans own more than 1 billion won in assets, a 9.6 percent increase compared to a year earlier. That is nearly 2.2 times the number in 2010, when it was about 160,000.
By types of wealth, 56.6 percent was in real estate, while 38.6 percent was in financial assets.
In 2016, before President Moon Jae-in took office, 51.4 percent of the wealth of the rich was in property. The number is increasing every year along with the Moon administration’s tightened real estate regulations; 52.5 percent in 2017, 53.3 percent in 2018 and 53.7 percent in 2019.
For about five weeks starting from July, the institute interviewed a total of 400 wealthy Koreans.
Of all respondents, a full 62.5 percent said they don’t consider themselves rich. They said a person must have at least 10 billion won to be described as wealthy.
About 37.5 percent said they earned their money through business, while 25.5 percent said they got it from real estate investment.
Roughly 19 percent said their wealth came from inheritance — compared to only 13.7 percent in 2011. Of the respondents, 10.5 percent were people who had more than 5 billion won in 2011, while that increased to 23.7 percent this year.
More Koreans answered that they would like to pass their wealth to their grandchildren. While 93.9 percent said they would pass down their wealth to their children, 31.8 percent said they would pass it on to their grandchildren. In 2011, only 9.2 percent said they would pass their wealth to their grandchildren. Multiple answers were allowed.
Respondents with 10 billion won or above on average invest 2.16 billion won in stocks, while those who have between 5 billion won to 10 billion won invest 1 billion won. People with less than 5 billion won on average put 500 million won toward stock investment.
Rich people invest more in foreign stocks and the Korea New Exchange (Konex) market. For people with less than 3 billion won, about 13.9 percent and 7.5 percent invest in foreign stocks and Konex, respectively. In the case of people who have more than 3 billion won, the number jumps to 34.8 percent and 20.3 percent.
BY CHEA SARAH [email@example.com]