SEOUL: A growing number of residents in Seoul are falling into irrecoverable debt, with new city data showing that people in their 60s and older now make up the majority of personal bankruptcy applicants.
Six out of every 10 individuals who sought personal bankruptcy assistance through the Seoul Financial Welfare Counseling Center in 2025 were aged 60 or above, according to a report released on Tuesday (March 10).
The center analysed 1,192 valid bankruptcy applications filed in 2025 as part of its annual review of bankruptcy counseling cases.
Those in their 60s accounted for the largest share of bankruptcy applicants at 36.5 per cent, followed by people in their 50s at 25.1 per cent and those aged 70 or older at 21.5 per cent.
Combined, people in their 50s and above made up 83.1 per cent of all applicants, the report found.
An overwhelming 86.2 per cent of applicants were recipients of basic livelihood security benefits, marking the third consecutive year the proportion has risen, from 83.5 per cent in 2023 to 83.9 per cent in 2024.
Single-person households accounted for 70.4 per cent of applicants.
Employment instability was another defining feature: more than 84 per cent were unemployed, rising to 88.2 per cent among those aged 60 or older.
Even among those with jobs, many were day laborers or short-term workers without stable income.
Most of the debt stemmed from basic living expenses. Insufficient income to cover daily costs accounted for 79.5 per cent of debt causes, with housing and medical expenses pushing many seniors into what the report described as “retirement bankruptcy”.
“Many elderly residents are reaching retirement with insufficient income and face debt that has accumulated from basic living costs,” the center said in the report. “Once repayment becomes impossible, personal bankruptcy often becomes their only option.”
In 89.8 per cent of cases, loan principal and interest payments had surpassed applicants’ income, effectively making repayment impossible.
Illness or hospitalisation triggered bankruptcy in 30.2 per cent of cases, up 5.9 percentage points from 2023.
Average total debt per applicant stood at 287 million won (S$247,365). For seniors, the burden was significantly heavier, with those aged 60 or older carrying an average of 394 million won in accumulated debt, the report showed. - The Korea Herald/ANN
