[Report] "It's a pie in the sky"... Youth sigh over fairness controversy of Cheongnyeon Hope Savings Plan

'Up to 10% Annual Interest' Youth Hope Savings, Fairness Controversy
"What About Unemployed Job Seekers Without Income?" Criticism

On the morning of the 24th, citizens are hurrying their steps near Noryangjin Station. Photo by Heo Midam damdam@

[Asia Economy Reporter Heo Midam] "Don't young people who can't make money receive any benefits? It's frustrating."

On the 24th, Mr. Yoo (27), whom we met near the academy district in Noryangjin, Dongjak-gu, Seoul, said, "'Youth Hope Savings' is contradictory from the name itself. I'm also a young person, but I can't receive the benefits," adding, "My friends who work have already applied, but I feel empty because I'm the only one who can't get the benefits."

Mr. Yoo, who revealed that he has been preparing for the Grade 7 civil service exam for two years, said, "Studying alone at the study room is hard enough, but not being able to receive the benefits that everyone else gets makes my situation look pitiful," and added, "Office workers receive their salary every month. But most of us public service exam takers are busy studying and have no income. I hope the eligibility criteria will be broadened next time such a policy is implemented."

There is controversy over fairness regarding the eligibility criteria for the 'Youth Hope Savings,' which offers an annual interest rate of around 10%. Complaints continue among young people who cannot join due to income levels and middle-aged people who are not eligible. In particular, criticism has grown as it is known that foreign residents in Korea are also included in the eligibility.

Students and other citizens are walking near the Noryangjin academy district in Dongjak-gu, Seoul. Photo by Heo Midam damdam@

Despite subzero temperatures on the morning of the same day around Noryangjin Station, young people hurried to academies and study rooms. They expressed doubts about the eligibility criteria for Youth Hope Savings, emphasizing that "young people without income should not be discriminated against."

Mr. Ahn (25), who said he is preparing for the Grade 9 civil service exam, criticized, "My friends who work have all joined, but I, who have no income, could not join," adding, "I don't understand a policy where people who don't earn money are excluded from benefits, and those who earn money receive benefits. If you want people to save, everyone should be allowed to join. This is unfair."

There were also opinions pointing out that foreign residents in Korea are included in the eligibility for Youth Hope Savings. Mr. Kim (27), who is studying to enter a public enterprise, said, "Shouldn't young people without income be prioritized? I think I saw an article saying the national debt is already high, so I'm worried about the country's future if foreigners are also taken care of."

Youth Hope Savings is a financial product that supports asset formation for low- and middle-income young people by providing tax-exempt benefits and savings incentives. The application target is young people aged 19 to 34 (born on or before February 21, 1987) with a total annual salary of 36 million KRW or less (based on the previous year).

Youth Hope Savings offers interest rates nearly five times higher than the approximately 2% offered by commercial bank savings accounts, and including tax-exempt benefits, the annual interest rate can exceed 9.49%, with a maximum benefit of 10.49%, attracting strong interest from young people even before its launch.

Citizens are walking near Noryangjin Station. Photo by Heo Midam damdam@

However, dissatisfaction continues mainly among young people who do not meet the eligibility criteria for Youth Hope Savings. It is pointed out as unfair that young people with high income or those preparing for employment without income cannot join.

In particular, there are repeated criticisms that the eligibility criteria are ambiguous. After deducting taxes from the annual income of 36 million KRW, the actual monthly take-home pay is about 2.64 million KRW. In other words, even if someone earns 2.7 million KRW per month, they are excluded from Youth Hope Savings eligibility. Considering that the average monthly wage of wage workers announced by Statistics Korea last year was 2.734 million KRW, young people earning the average wage are excluded from the eligibility.

Another issue is that foreigners can join as long as they meet the qualifications. Foreign young workers who have lived in Korea for more than 183 days and pay taxes can apply for Youth Hope Savings if they meet the eligibility criteria.

The 'Youth Hope Savings' account, which offers an effective annual interest rate of around 10%, was launched on the 21st through face-to-face and non-face-to-face methods at Kookmin, Shinhan, Hana, Woori, Nonghyup, Industrial, Busan, Daegu, Gwangju, Jeonbuk, and Jeju banks. The photo shows a bank in Seoul and a mobile app. [Image source=Yonhap News]

Given this situation, opinions have emerged calling for easing the eligibility criteria and prioritizing citizens. On the 23rd, a petition titled "Youth Hope Savings for Foreign Young People Giving All the Money Away in Korea" was posted on the Blue House's public petition website.

The petitioner, who identified themselves as a 34-year-old office worker, said, "Should I give money to foreign young people with the taxes I paid? Young people who actually pay taxes don't even receive support," adding, "Since when has our country taken care of foreign young people? Do we have the taxes for that?" This petition has received over 100 preliminary consents and is under review by the administrator.

Meanwhile, due to the explosive interest in Youth Hope Savings, the government decided to increase the budget. Initially, the budget for the Youth Hope Savings project this year was 45.6 billion KRW, which could support about 380,000 people assuming all subscribers joined with the maximum monthly deposit limit of 500,000 KRW.

However, as the 'preview' service for Youth Hope Savings showed that about 2 million people (including duplicates) checked the service at the five major commercial banks, and some banks' apps experienced access failures on the first day of application on the 21st due to the flood of applications, the government negotiated a budget increase.

President Moon Jae-in said at the Cabinet meeting on the 22nd, "Although the project was initially planned to support 380,000 young people, since the number of applications is expected to surge, we will significantly expand the plan and approve the operation plan for Youth Hope Savings," adding, "All young people who meet the eligibility criteria will be able to receive benefits."

This content was produced with the assistance of AI translation services.