Defined contribution (DC) plans and individual retirement pension (IRP) accounts have surpassed half of all retirement pension assets. It is the first time since related statistics have been compiled. As interest in retirement pensions has grown, workers appear to prefer choosing how to manage their money themselves rather than leaving management to their companies.
According to the "2024 Retirement Pension Statistics" that the National Data Office released on the 15th, total retirement pension assets, including defined benefit (DB), DC, and individual IRP accounts, reached 431 trillion won, up 49 trillion won from the previous year (381 trillion won). Of that, the share of DC plans (116 trillion won) and individual IRPs (99 trillion won) was 50.3%. It is the first time since statistics began in 2015 that these two types have exceeded half of total assets.
An official at the National Data Office said, "The (retirement pension) return was higher when managed directly, so workers appear to have flocked to DC plans and individual IRPs." According to the Financial Supervisory Service, last year the annual return of individual IRPs (5.86%) and DC plans (5.18%) was more than 1 percentage point (p) higher than DB plans (4.04%).
Interest in individual IRPs has grown in the market recently in particular. An individual IRP is a retirement pension product that workers with DB or DC plans additionally enroll in for old age. The number of individual IRP subscribers increased by 377,000 (11.7%) in one year to 3,592,000. The amount of assets accumulated also increased by 23 trillion won (30.3%) over the same period to 99 trillion won.