Retirement-age Koreans still support parents and children

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Retirement-age Koreans still support parents and children

Published: 28 Aug. 2024, 06:00 Updated: 28 Aug. 2024, 17:20

Audio report: written by reporters, read by AI

People line up at a job fair for senior citizens in Mapo District, Seoul. [YONHAP]

While the age of 60 is often seen as a time for retirement and self-care, many Koreans are facing the burden of supporting both their parents and adult children.

Approximately 15 percent of respondents born in the 1960s who participated in a June survey conducted by Hankook Research are engaged in "double care," meaning they have to provide financial support for both their elderly parents and children. These individuals reported spending an average of 1.64 million won ($1,236) per month on caregiving, accounting for nearly half of the group's average ordinary income of 3.58 million won.

Members of this demographic are burdened with the responsibility of supporting their parents, a generation not prepared for retirement because of fewer opportunities to accumulate wealth and receive a sustainable national pension due to Korea's economic status and a lack of social systems in the past. As life expectancy increases, these older parents are requiring more support from their relatively younger yet still aged children.

The poverty rate among people born in the late 1930s and 1940s was over 50 percent, more than twice the rate of those born in the late 1950s, according to a 2021 report from the Korea Development Institute. The poverty rate for this age group was calculated as the percentage of individuals aged 65 and older whose income falls below the median income for their age group. A separate 2021 survey by Statistics Korea found that 60.3 percent of people aged 65-69 were supporting their elderly parents, while only 30.4 percent reported that their parents were financially independent.

Young job seekers receive personalized career counseling as part of an employment program. [NEWS1]

Adding onto their burden, a rising number of adult children in their 20s and 30s are growing financially reliant on their parents amid a dampening economy and strained job market.

A study by Statistics Korea found that 12.5 percent of Koreans aged 65 or older regularly provide financial support to their adult children. This figure marks a substantial 13.8-fold increase compared to the 2011 data. Individuals aged 65-69 were most likely to offer such assistance, with 15.6 percent doing so, followed by those aged 75-79 at 11.2 percent, 80-84 at 9 percent and 85 or older at 6.8 percent.

A 67-year-old lifelong housewife surnamed Kim exemplifies this trend. She has recently opened a small pub for her son, investing her husband's retirement savings and a portion of their joint funds into the business. Her son, in his mid-40s and still unemployed, prompted her to use their retirement savings to help him start a new career. She also bears the financial burden of supporting her mother and mother-in-law.

"I'll take care of the kitchen, and my son will manage the front of the house," she explained. "If the business is successful, I hope to eventually hand it over to him. I'm concerned about depleting our retirement savings, but I felt it was necessary."

A record-high 31.4 percent of 3.77 million young people in Korea began their careers with a contract gig lasting less than a year, according to the statistics agency. This marks the highest percentage since relevant data was first compiled. Overwhelmed by their unstable financial status, an increasing number of young people in their 20s and 30s are classified as "discouraged workers." The number of these individuals, of legal employment age but not actively seeking employment, has surpassed 700,000 for the first time since 2003.

"Elderly people, especially those in their 60s, have invested heavily in their children's education, hoping to replicate their own success through education," said Byun Geum-sun, associate research fellow at the Seoul Institute.

"However, unlike in the past, a degree from a prestigious university no longer guarantees success," he added. "Their children's delayed employment has placed a significant financial burden on the members of this demographic. Given their increased financial burden and responsibilities, combined with the rising retirement age, there is a clear need for greater social support for this demographic."

BY KIM NAM-JUN [yoon.seungjin@joongang.co.kr]