Household Surplus Funds Hit 17-Year High: How Koreans Are Investing Their Money

According to Financial News, surplus funds held by Korean households jumped more than 25% in a year, reaching the highest level in 17 years since the statistics began. Roughly one-third of the money they invested went into stocks and funds, with a preference for overseas markets rather than domestic equities.
The Bank of Korea (BOK) released its "Flow of Funds Statistics 2025" on the 9th. It estimated that households and non-profit institutions supplied a net 269.7 trillion won in funds last year. This was an increase of 25.2%—or 54.2 trillion won—from 215.5 trillion won a year earlier, and it marked the highest level since the series was first compiled in 2009.
Net funds supplied are calculated by subtracting funds raised, such as borrowing from financial institutions, from funds invested in deposits, insurance and pension reserves, and securities. In effect, it represents the surplus funds of that sector. The increase in net funds supplied by households and non-profit institutions reflects that the growth in funds invested outpaced the rise in funds raised.
In fact, total funds invested reached 342.4 trillion won, up 93.6 trillion won from 248.8 trillion won a year earlier. Of this, deposits at financial institutions such as banks accounted for the largest share at 131.5 trillion won, followed by equity securities and investment funds at 106.2 trillion won.
Looking more closely, 46 trillion won was invested in shares issued by non-residents (overseas stocks), while 75.5 trillion won went into investment fund shares such as exchange-traded funds (ETFs). By contrast, 15.2 trillion won flowed out of shares and equity stakes issued by residents (including domestic stocks). Other major destinations included insurance and pension reserves (87.1 trillion won), cash and other assets (13 trillion won), and bonds (4.6 trillion won).
Funds raised also nearly doubled, climbing from 33.3 trillion won to 72.7 trillion won. Borrowing from financial institutions made up the bulk at 75.9 trillion won. This category includes not only bank loans but also credit provided by securities firms and stock-collateralized loans. Within this, mortgage loans increased by 44.8 trillion won from the previous year.
As funds raised grew, the ratio of household debt to the size of the economy declined. At the end of last year, household debt stood at 88.6% of nominal Gross Domestic Product (GDP), down 1.0 percentage point from 89.6% a year earlier. Kim Yong-hyun, head of the Flow of Funds Team in Economic Statistics Department 1 at the BOK, explained, "This reflects the continued impact of the June 27 Real Estate and Loan Regulation Measures, the October 15 Real Estate Measures, and the implementation of the three-stage Debt Service Ratio (DSR) rules last year."
For non-financial corporations, net funds raised shrank from 77.5 trillion won in 2024 to 34.2 trillion won last year. Corporate net profits increased, but investment slowed amid rising domestic and external uncertainty. On the investment side, of the 213.2 trillion won in funds allocated, 72.7 trillion won was placed in deposits at financial institutions. Meanwhile, total funds raised surged from 154.2 trillion won to 247.4 trillion won.
Net funds raised by the general government expanded from 36.1 trillion won to 52.6 trillion won. This was because government spending grew faster than revenue, resulting in the largest figure since the statistics were reorganized in 2009. Although funds invested—centered on equity securities and investment funds—increased from 34.2 trillion won to 95.3 trillion won, funds raised jumped even more sharply from 70.4 trillion won to 147.9 trillion won due to increased issuance of government bonds to finance higher spending.
The rest of the world sector also saw its net funds raised grow from 116.6 trillion won to 158.2 trillion won, driven by a larger current account surplus. Funds invested reached 126.2 trillion won, as investment in bonds rose sharply to 87.4 trillion won. Funds raised totaled 284.4 trillion won, reflecting increased purchases of overseas stocks by residents.
As of the end of last year, financial assets held by households and non-profit institutions stood at 6,201.9 trillion won, up 729.3 trillion won from 5,472.6 trillion won a year earlier. Their financial liabilities increased by 73.7 trillion won, from 2,367.5 trillion won to 2,441.2 trillion won. As a result, net financial assets rose by 655.6 trillion won over the year to 3,760.7 trillion won.
The ratio of financial assets to financial liabilities was 2.54 times, up from 2.31 times at the end of the previous year.
Within financial assets, deposits and similar instruments accounted for the largest share at 43.2%, followed by insurance and pension reserves at 26.6%, equity securities and investment funds at 26.5%, and bonds at 2.9%. On the liabilities side, loans from deposit-taking institutions made up 71.0%, ahead of loans from other financial intermediaries (11.5%), other loans (6.9%), and loans from insurance and pension funds (4.5%).

taeil0808@fnnews.com Kim Tae-il Reporter