Youth Leap Account holders also eligible to switch

Rejected applicants to be given chance to appeal

A notice posted at Woori Bank's headquarters in Jung-gu, Seoul. [Yonhap]
A notice posted at Woori Bank's headquarters in Jung-gu, Seoul. [Yonhap]

The second round of applications for the Youth Future Savings Account — which offers an effective annual return of up to 19.4 percent — closes Friday.

The Financial Services Commission said Thursday that the application window will close at 6:30 p.m. Friday.

Eligible applicants are those born between Nov. 17, 1991, and Nov. 27, 2007. Those wishing to sign up must submit their applications through the mobile apps of commercial banks or post offices before the deadline.

Eligibility screening will run from Monday through Nov. 13. The government plans to notify applicants of preliminary screening results between late this month and Nov. 2, before final decisions are issued, and will give rejected applicants an opportunity to appeal.

Those who receive notification of eligibility may open a Youth Future Savings Account through their financial institution's app between Nov. 16 and Nov. 27.

Account opening will not be possible after that window closes, so applicants must complete the process within the designated period.

Existing Youth Leap Account holders who meet the eligibility requirements for the Youth Future Savings Account may also switch over.

Those who apply during this second round and pass screening should first open a Youth Future Savings Account during the account-opening period, then apply for a "special early termination of the Youth Leap Account for the purpose of joining the Youth Future Savings Account."

Taking into account both the government contribution and the tax-exempt benefit, the FSC said the product offers an effective annual return of up to 14.4 percent for the standard tier and up to 19.4 percent for the preferential tier.

If the government's 2027 budget proposal — which includes an expansion of eligibility and an increase in the preferential-tier contribution rate — is approved by the National Assembly, the government plans to apply the improved benefits retroactively to existing account holders.

Existing preferential-tier holders would receive a retroactive top-up of the higher government contribution, while those currently enrolled without a contribution benefit — who receive only the tax-exempt interest income — would retroactively receive the standard-tier government contribution.


hyuk@heraldcorp.com