As the domestic stock market stages a record-setting rally, the landscape of the retirement pension market is also shifting. Funds that had long been seen as "sleeping money" tied up in principal-protected products are moving quickly into performance-based options, ushering in a shift from the "age of deposits" to the "age of investment."
NH Investment & Securities asset management consulting center said the key to retirement pension investing is the "acceleration of MoneyMove into defined contribution (DC), individual retirement pensions (IRP), and exchange-traded funds (ETF)." Money that used to sit like deposits is changing into capital seeking revenue, and at the center are DC and IRP accounts, where subscribers can act directly, along with ETFs.
According to the "2025 Korea retirement pension investment white paper" released by the Ministry of Employment and Labor (MOEL) and the Financial Supervisory Service, retirement pension reserves at the end of last year totaled 501.4 trillion won, up 69.7 trillion won from the previous year (431.7 trillion won). After first surpassing 400 trillion won in 2024, the total exceeded 500 trillion won in just one year.
The DC and IRP share was 50.3% in 2024, surpassing DB for the first time, and grew to 54.3% in 2025, while the DB share fell to 45.7%. As the structure shifts from entrusting pensions to companies to subscribers managing them directly, retirement pensions are no longer financial products to be merely "kept" but financial products that must be "managed."
The change in management style is also steep. Performance-based reserves increased from 75 trillion won at the end of 2024 to 123 trillion won at the end of 2025. While principal-protected products (378 trillion won) still hold an absolute advantage at 75.4% of the total, the share of investment-type products is steadily rising.
At the center of the retirement pension shift are ETFs. ETF investment through retirement pension accounts totaled 48 trillion won at the end of 2025. Year-end ETF balances surged from 9 trillion won in 2023 to 21 trillion won in 2024 and 48 trillion won in 2025, posting more than 100% growth for three straight years. The ETF share within performance-based reserves also jumped to 18.3% in 2023, 27.9% in 2024, and 39.6% in 2025.
NH Investment & Securities asset management center said ETF inflows rose quickly because low fees, easy trading, diversification effects, and clear index tracking align well with the long-term management of retirement pensions. The fact that, by design, DC and IRP subscribers can choose products directly also supported the spread of ETF investing.
Most retirement pension funds use the U.S. stock market as the core investment axis. Recently, however, new inflows have concentrated in domestic index ETFs, semiconductor themes, and bond-mix 50 products tied to Samsung Electronics and SK hynix.
As of the end of May this year, the ranking of product inflows was: No. 1 U.S. S&P 500-tracking ETFs (666.9 billion won), No. 2 U.S. Nasdaq 100-tracking ETFs (531.6 billion won), and No. 3 domestic KOSPI 200 ETFs (372.5 billion won). A dual pattern has emerged in which long-term balances remain U.S.-centric, while recent buying has partially shifted to domestic semiconductors and bond-mix 50 products that can fill the 30% allocation to safe assets.
As of the end of 2025, retirement pension market share by provider stood at 52.0% for banks, taking half the market, followed by securities at 26.2%, life insurance at 17.5%, and non-life insurance at 3.4%. Banks still have the largest share, but as demand grows for performance-based and ETF management, securities firms are gaining prominence. This suggests the retirement pension market's competitive edge is shifting from "who is safer" to "who helps you manage better."
An official at NH Investment & Securities asset management center said, "The essence of retirement pensions surpassing 500 trillion won is that money companies used to park is moving to money managed by individuals, shifting from deposits to investment products and ETFs," and "the changes underway in the retirement pension market are less a temporary fad and more a structural shift that is changing the very nature of old-age funds."