The "Our Child Independence Fund," which deposits 1.2 million won each year until a child born into a household under 50% of the median income (next year's standard for a family of four: 3.46 million won per month) turns 18, will launch next year. Even if parents do not contribute a single won, the government will make the deposits. The aim is to help low-income children build asset. Children born on Sept. 1 this year or later are eligible.
The Ministry of Planning and Budget said at the "Youth Budget Unboxing 2027" event held at the Blue House on the 28th that it will expand comprehensive investments by youth growth stage by 53.3%, from 2.82 trillion won this year to 4.33 trillion won next year. It also said that an individual can receive benefits worth up to 140.57 million won by age 18, and up to 195.82 million won by age 34, from birth through job seeking and marriage.
◇ Parents earning 10 million won a month can get a 1 million won match if they put in 1 million won a year
If parents in a household under 50% of the median income create an Our Child Independence Fund, the government will deposit 1.2 million won into the fund each year from the child's birth until the child turns 18. If they enroll at the time of birth, at least 21.6 million won will be accumulated. Parents can also contribute to this fund.
Households from 50% up to but under 150% of the median income can enroll in this fund. The required parental contribution to receive government support varies by income. For example, in households from 50% up to but under 100% of the median income (3.46 million won to 6.93 million won per month), parents must put 500,000 won into the fund each year for the government to provide 1 million won. In households from 100% up to but under 150% of the median income (6.93 million won to 10.4 million won per month), if parents contribute 1 million won, the government will add 1 million won.
◇ Youth future installment savings paying 19% interest a year available even with a 100 million won salary
Starting next year, the government will scrap the total salary cap of 60 million won or less for enrollment in the standard Youth Future Installment Savings product, which can earn up to 19% interest a year. People earning 100 million won a year will also be able to enroll. Currently, for the Youth Future Installment Savings, people ages 19 to 34 who make monthly deposits of up to 500,000 won for a three-year term receive a government contribution of 6% to 12% of their deposits. The standard type yields an effect equivalent to a simple-interest savings of 13.2% to 14.4% a year, and the preferred type yields 18.2% to 19.4% a year. Interest income tax (15.4%) does not apply.
In addition, the government will introduce "Youth Opportunity Funds," which lend up to 20 million won interest-free until employment to young people with annual incomes of 35 million won or less. Young people can borrow up to 5 million won at a time, with an annual limit of 7.5 million won. No interest is due before employment; after employment, they can repay the principal with interest of 2% to 5% a year.