April 25, 2024
Finance
Private pension funds see low yields in Korea
[THE INVESTOR] Most pension savings funds in South Korea have logged negative yields this year, according to data on Dec. 19.
The average return of 227 such pension funds here, each with initial assets of 1 billion won (US$840,000) under management, stood at minus 2.6 percent as of Dec. 16, according to the data compiled by industry tracker FnGuide.
The three-month and six-month yield rates were minus 0.37 percent and minus 0.17 percent, respectively.
For people who bought the products in late 2015, the one-year return rate was 0.08 percent, far lower than interest rates for bank deposits.
But those products still remain appealing to investors in search of tax incentives as holders of the long-term funds are eligible for tax deductions of up to 4 million won of payment per year.
“Besides, investors don’t need to pay separate resale fees for pension savings funds,” said Ahn Yoon-shul, a researcher at the Korea Retirement Planning Institute. “So they can change funds anytime to high-yielding ones.”
(theinvestor@heraldcorp.com)
The average return of 227 such pension funds here, each with initial assets of 1 billion won (US$840,000) under management, stood at minus 2.6 percent as of Dec. 16, according to the data compiled by industry tracker FnGuide.
The three-month and six-month yield rates were minus 0.37 percent and minus 0.17 percent, respectively.
For people who bought the products in late 2015, the one-year return rate was 0.08 percent, far lower than interest rates for bank deposits.
But those products still remain appealing to investors in search of tax incentives as holders of the long-term funds are eligible for tax deductions of up to 4 million won of payment per year.
“Besides, investors don’t need to pay separate resale fees for pension savings funds,” said Ahn Yoon-shul, a researcher at the Korea Retirement Planning Institute. “So they can change funds anytime to high-yielding ones.”
(theinvestor@heraldcorp.com)
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