What About Living Expenses After Retirement? ... There Is a Way to Receive 'Hundreds of Thousands in Cash' Every Month [AK Radio]

Housing Pension A to Z
A Financial Tool and Welfare Benefit
Stable Retirement Without Seed Money

Many retirees want to live comfortably after retirement but lack sufficient seed money and find it difficult to rely on their children.

If you make good use of the Housing Pension, you can live in your own home while receiving a lifelong pension.

Let's learn about how to join the Housing Pension and the eligibility requirements.

▲What is the Housing Pension?

=It is a type of social security system provided by the Korea Housing Finance Corporation, where you receive tens of thousands to hundreds of thousands of won in cash every month until death just by living in the house you have mortgaged to them. You simply provide your personally owned home as collateral to the Korea Housing Finance Corporation. If the subscriber dies and the spouse is still alive, the pension can be inherited until the spouse's death. It can be considered a financial welfare benefit enjoyed throughout retirement beyond just a financial investment tool.

▲Do you just have to live in the house? Are there any eligibility conditions?

=At least one spouse must be 55 years or older and own a house or residential officetel with a publicly announced price of 1.2 billion KRW or less. Even if you own multiple houses, the total value of all houses must be 1.2 billion KRW or less.

▲If I just provide my house as collateral, do I not have to pay anything to the government?

=You must pay initial guarantee fees, annual guarantee fees, loan interest, appraisal fees, and registration license tax (including local education tax), among others.

▲I can't quite grasp it. How much is a publicly announced price of 1.2 billion KRW?

=It is slightly higher than the average apartment price in Seoul. According to data from the Seoul Real Estate Information Plaza, the average apartment transaction price in Seoul in January was 995.44 million KRW. The monthly average transaction price throughout last year ranged between 1 billion and 1.2 billion KRW.

▲It's hard to find. Where can I check my house's publicly announced price?

=You can visit the Ministry of Land, Infrastructure and Transport's 'Real Estate Public Price Informer' website and check the publicly announced prices of apartments by area. On the website, turn on 'Apartment Public Price Inquiry' under 'Apartment Public Price' at the top left, then enter the city/province, district, and road name. For example, for Boramae Kyungnam Honorsville on Yeouidaebang-ro, Yeongdeungpo-gu, Seoul, as of January 1 last year, the exclusive area of 84㎡ (25.6 pyeong) had a publicly announced apartment price of 527 million KRW.

▲Do I have to receive the same amount every month as the government gives?

=No. There are mainly two types: 'Lifetime method' and 'Fixed period mixed method.' The lifetime method is common. Within the lifetime method, there is a 'fixed amount type' where you receive the same amount every month until death. There is also an 'initial increase type' where you receive more than the fixed amount type during the first 3, 5, 7, or 10 years and then less afterward. For subscribers who join at age 55, they receive more than the fixed amount type during their 50s and 60s and less afterward. Conversely, there is a 'regular increase type' where subscribers in their 60s or 70s receive less than the fixed amount type initially but increase by 4.5% every 3 years. The fixed period mixed method allows you to choose a fixed period of 10, 15, 20, 25, or 30 years depending on your joining age, during which you receive the same amount every month and then continue for life.

▲Do I have to live in the mortgaged house unconditionally?

=Living in the subscribed house is the principle, but exceptions are allowed. Exceptions include hospitalization or long-term stay in nursing homes or other houses due to care by children, moving to elderly residential welfare facilities, or being unable to live in the subscribed house due to government orders such as quarantine, detention, or imprisonment. The Korea Housing Finance Corporation may also recognize special personal circumstances.

▲If I join the Housing Pension, can I rent out my house as monthly rent or jeonse?

=Yes. Since last year, the Korea Housing Finance Corporation announced that it continues to pay the Housing Pension to subscribers who have moved to silver towns. This means that with prior approval from the Korea Housing Finance Corporation, you can move to a silver town and rent out your existing house to tenants to earn rental income.

▲I know it's good, but it's not a financial investment tool to make 'big money' like coins or stocks.

=That's right. It is literally a pension. It is hard to view it as a product to roll money like a snowball and become rich. Compared to lump-sum pension products or savings/deposits, receiving a stable monthly pension might be less burdensome. It is recommended for those who want to spend their retirement safely rather than those who want to make big money.

▲I heard some subscribers cancel early.

=Recently, the Housing Pension trend is picking up again. This is largely due to the real estate market cooling down again. It is stable because you can receive a lifelong pension just by mortgaging your house to the Korea Housing Finance Corporation and living in it. According to the Korea Housing Finance Corporation, the number of new Housing Pension subscriptions in December last year increased by 18% compared to November, reaching 1,507 cases.

▲What is the outstanding advantage of the Housing Pension compared to other financial investment tools?

=Even if your saved retirement funds are small, the Housing Pension is perfect for creating an opportunity to live a stable retirement. You only need to provide your house as collateral. It does not require a large amount of money to join. It also reduces worries about losses. You don't need to stress over market price charts.

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