"Why Did You Even Invest in Stocks?" Heard 'Investment Failure Nagging' During the Holidays?

20s-30s 'Excessive Investment' Ultimately Fails
Harsh Criticism from Surroundings... Some Sighs of 'Stress'

Customers are receiving investment consultations at a bank fund consultation desk. Photo is not related to the specific content of the article. [Image source=Yonhap News]

[Asia Economy Reporter Han Seung-gon] # Kim, a man in his 30s, had a huge fight with his relatives this Chuseok, to the point he wants to forget the holiday. Kim said, "I suffered huge losses in stocks and coins, and I was heavily criticized not only by my family but also by my relatives," adding, "I learned that stock failures don't just mean losing money, but can also ruin relationships with acquaintances and family."

Like Kim's case, many young investors have recently expressed feelings of depression due to failures in stock or cryptocurrency investments. At recent family gatherings during holidays, voices of frustration have emerged as they endure various criticisms. They are already distressed by investment losses and say they simply cannot bear to listen any longer.

On the other hand, there are opinions that when someone ignores their circumstances and falls into debt due to excessive investment, stern reprimands are necessary because the situation may become irreversible.

◆ Increasing Young Investors... Investing in Domestic and Foreign Stocks and Coins

The number of young people investing in stocks or cryptocurrencies (coins) is on the rise. According to the Korea Securities Depository last month, the proportion of investors in their 20s and 30s among listed company investors increased significantly from 23.7% at the end of 2019 to 35.7% at the end of 2021.

Additionally, according to Upbit, a cryptocurrency exchange, the proportion of customers in their 20s and 30s reached 59.8% (1,796,000 people) in October 2020, and although the proportion was similar at 60% in October 2021, the number of young customers increased nearly threefold to 5,394,000 compared to the previous year.

Furthermore, according to data released by the Financial Supervisory Service last August, the total number of overseas stock accounts reached 4.91 million at the end of last year, about six times the 800,000 accounts at the end of 2019. Meanwhile, the number of overseas stock accounts held by people in their 20s and 30s increased even more sharply, from 320,000 at the end of 2019 to 2.54 million at the end of last year, about eight times more. It can be seen that young people invest not only in domestic stocks but also in overseas stocks.

An investor is watching the stock market trends. [Image source=Yonhap News]

◆ Recovery or Bankruptcy Due to Investment Failures... Government Establishes Special Debt Adjustment System for Youth

However, the investment results of young people are not very good. There have even been extreme cases presumed to be due to investment failures. In January, a man in his 20s working at a factory in Gyeongbuk, identified as Mr. A, took his own life. According to the police, Mr. A left a suicide note saying "I'm sorry to my family," and it is known that he had suffered significant losses from investments in stocks and Bitcoin.

Personal rehabilitation cases among young people are also increasing. According to 'Rehabilitation and Bankruptcy Status' data obtained by Democratic Party lawmaker Jin Sun-mi from the Supreme Court, the number of personal rehabilitation filings for those aged 20 to 29 was 10,307 in 2019, 11,108 in 2020, and 11,907 in 2021, increasing by about 800 cases annually. This is interpreted as cases where losses were incurred after investing in stocks or coins.

As a result, the public perception of young people's failures in stock or coin investments is not favorable. Earlier, in July, the government created a special debt adjustment program for youth, including those who suffered losses from so-called 'debt investment' (borrowing money to invest) such as virtual asset investors. This led to controversy over debt forgiveness for youth, which escalated into intergenerational conflict.

There are also cynical responses to the government-established system. In an online survey conducted by Media Real Research from the 17th to the 23rd of last month targeting 3,806 adult men and women regarding 'Youth Debt Adjustment Support,' 37.4% (1,425 respondents) answered 'strongly agree' and 32.3% (1,232 respondents) answered 'agree' to the item 'There is a concern that people might borrow money under the pretext of government support.'

Park, a company employee in his 20s, said, "Isn't investment a personal choice?" and pointed out, "The very situation where the state provides help is contradictory." Another office worker, Choi, also complained, "Isn't this effectively shifting the responsibility for investment failures onto the state?"

Meanwhile, the government's newly established 'Special Debt Adjustment System for Youth' aims to prevent long-term economic difficulties caused by investment failures among youth and low-income groups. It provides temporary support for one year, including interest reduction and repayment deferral. The Financial Services Commission explained, "After debt counseling by the Credit Counseling and Recovery Service, if court rehabilitation is advantageous, we plan to support the activation of a 'fast track' that simplifies court hearings to help youth and low-income groups quickly return to society."

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