The Korea Herald

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지나쌤

Over-50s, men, single-person households take up majority of those filing for bankruptcy

By Yoon Min-sik

Published : April 24, 2024 - 14:20

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Nearly 90 percent of those who filed for bankruptcy in Seoul last year were aged at least 50, with a substantial portion of the number being male or living alone, Seoul government data showed Wednesday.

The data released by Seoul Financial Welfare Counseling Center, an affiliate of the city-run Seoul Welfare Foundation, showed that 86 percent of valid bankruptcy applicants last year were 50 or older, and 64.4 percent were male.

Of those who declared themselves bankrupt, 83.5 percent had been beneficiaries of the state-provided Basic Livelihood Security Program for those with minimal or no income.

The report also showed that 63.5 percent of the applicants were single-person households, implying that an increasing percentage of senior citizens living alone are having financial difficulties.

A Ministry of Interior and Safety data released earlier this month showed that 41.8 percent of all households in the country consist of a single individual, and that 1.85 million people in their 60s and 1.98 million people aged 70 or older are living alone. The ministry data showed that there were more male than female single-person households in the country, 5.15 million to 4.86 million.

The Seoul report also categorized what the bankruptcy applicants listed as reasons for their mounting debt. The lead answer was living expenses at 48.8 percent, failed business management at 21.5 percent, while 13.2 percent cited loan guarantees or having been victims of fraud.

About 89.1 percent of the applicants were unemployed, and only 5.3 percent held a regular job. About 1.1 percent were self-employed.

Some 85.1 percent of the applicants were living in rented homes.

Most of the applicants had debts, most commonly under 100 million won ($73,000). Approximately 59.5 percent had debts under 100,000 won, while 23.4 percent had debts between 50 and 100 million won.

Those who cannot pay back their debt and have no foreseeable income as a means to handle their debt -- such as credit recovery -- can apply for bankruptcy, regulated and defined under the Debtor Rehabilitation and Bankruptcy Act.

The Seoul Financial Welfare Counseling Center opened in 2013 to provide related counseling for those wishing to apply for bankruptcy and has helped 12,231 people acquire legal immunity for a total of 3.8 trillion won since then.