Lotto Subscription Fever Heats Up, but Subscription Account Enrollment Rate Drops... Why? [AldonSseulJap]

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[Image source=Yonhap News]

The subscription savings account has long been considered essential for financial investment.

By regularly depositing a fixed amount every month, you can enjoy the pleasure of saving,

accumulate seed money,

and even get a new apartment?a triple benefit subscription savings account.

However, recently, the number of subscription savings account cancellations has significantly increased.

Despite the subscription fever being hot every day, calling it a 'lottery subscription',

why is the number of cancellations actually rising?

Let's find out.

Subscription System Revised for the First Time in 41 Years... What Has Changed?

Recently, the government adjusted the recognized deposit amount for the subscription system for the first time in 41 years since its introduction.

First, the monthly recognized deposit limit was raised from 100,000 KRW to 250,000 KRW.

This will be implemented from November 1.

Previously, whether you deposited 500,000 KRW or 1,000,000 KRW at once, the recognized limit per deposit was 100,000 KRW, but now it has been increased to 250,000 KRW per month.

For public housing, winners are selected based on the total amount deposited monthly by the account holders.

Also, conversion between subscription savings, subscription installment savings, and subscription deposits is now possible.

The official name of what we commonly call the subscription savings account is 'Housing Subscription Comprehensive Savings'.

This allows subscription for both private and public housing.

However, products subscribed to before the introduction of 'Housing Subscription Comprehensive Savings', such as

subscription deposits, subscription installment savings, and subscription savings, were limited to either private housing or public housing depending on the product.

Note that this only broadens subscription opportunities.

Because the expanded subscription types are recognized as 'new deposit performance'.

The interest rate on subscription savings accounts has also been raised to a maximum of 3.1%.

The previous interest rate was 2.8%, so it was increased by 0.3 percentage points.

The subscription savings interest rate was raised by 0.3 percentage points in November 2022,

0.7 percentage points in August 2023, and now another 0.3 percentage points.

In total, under the Yoon Seok-yeol administration alone, the subscription savings interest rate has increased by 1.3 percentage points.

Lastly, benefits have been strengthened for households with newborns, couples, and minor children to overcome low birth rates.

In the past, if a couple applied for the same apartment simultaneously, it was disqualified, but from now on, both spouses can apply.

This increases the chances of winning.

Even if both spouses win, it will not be invalidated; the first application submitted will be recognized as valid.

It is now possible to combine the subscription account periods between spouses.

For private housing point-based subscriptions, in addition to the head of household's subscription period, half of the spouse's subscription period, up to a maximum of 3 points, can be combined.

The subscription period for minors has also been extended from 2 years to 5 years.

Previously, if a child joined the subscription savings account at age 17,

now it is better to join at age 14.

Despite Increased Benefits, Subscription Account Holders 'Plummet'... Why?

Despite the government dramatically increasing subscription savings account benefits,

the number of subscribers continues to decline.

According to Korea Real Estate Agency's Subscription Home, as of the end of September, the number of subscription savings account holders was 26,794,240, a decrease of about 38,793 compared to the previous month.

The number of subscription savings account holders has been declining for 2 years and 3 months since June 2022.

Why is the number of subscribers decreasing even though benefits have increased?

Experts point to the 'subscription futility theory'.

Because prices have already risen significantly, subscriptions no longer offer affordable home ownership, and the competition rate is so high that winning is like reaching for the stars.

Also, in provincial areas, it is possible to purchase apartments without a subscription savings account, which is another reason for the futility theory.

Keep or Cancel Your Subscription Savings Account?

Subscribers may be wondering whether it is more beneficial to keep or cancel their subscription savings account.

If you have many deposits and a long period of maintaining a non-homeowner status, it is advantageous to keep the subscription savings account.

If you have few deposits and are considering purchasing a house rather than subscribing, canceling is also a reasonable choice.

However, if you have no dependents, canceling immediately is not a bad option, but since the number of dependents helps increase subscription points, if you have dependents, you should consider carefully.

Nonetheless, experts commonly agree that keeping the subscription savings account long-term is advantageous.

The subscription system may be revised again, and the housing market is always changing,

so continuing to deposit regularly and build up your savings

increases your chances of owning a home.

Don't Have a Subscription Savings Account? Why Not Open One Now?

Subscription savings accounts can be opened by heads of households and household members in non-homeowner households, with only one account per person.

You can freely deposit between 20,000 KRW and 500,000 KRW monthly.

Note that if there are subscribers depositing 100,000 KRW and others depositing 250,000 KRW monthly, both are recognized as one deposit installment, but the difference in recognized deposit amount may delay reaching the winning amount.

Currently, you can open a Housing Subscription Comprehensive Savings account at nine banks including KB Kookmin Bank, Shinhan Bank, Hana Bank, Woori Bank, NH Nonghyup Bank, IBK Industrial Bank, IM Bank, Busan Bank, and Gyeongnam Bank.

New subscriptions are also possible through bank applications without visiting the bank.

[Image source=Yonhap News]

There is also a subscription savings account for youth.

It is the newly introduced 'Youth Housing Dream Subscription Savings Account' launched earlier this year.

It raised the annual income limit compared to the existing 'Youth Preferential Subscription Savings Account' (from 36 million KRW or less to 50 million KRW or less), and the deposit limit nearly doubled to a maximum of 1,000,000 KRW.

The interest rate was also raised from a maximum of 4.3% to 4.5%, with an additional 1.7 percentage points added to the comprehensive savings interest rate.

All existing Youth Preferential Subscription Savings Account holders will be automatically converted to the Youth Housing Dream Subscription Savings Account.

Comprehensive savings account holders can also convert to the Youth Housing Dream account if they meet the eligibility requirements.

However, the subscription period is limited until the end of 2025, so if you meet the requirements and are considering subscribing, it is best to hurry.

[Image source=Yonhap News]

If you are a beginner in financial investment,

the subscription savings account is a must-have.

For apartments in prime locations, the subscription winning cut-off is high,

so the subscription savings account may feel unnecessary at first,

but since the number of deposits matters, it helps cultivate a habit of steady saving, making it a recommended entry-level financial investment tool.

Especially if you have minor children, opening a subscription savings account to help them develop saving habits will also help raise financially savvy kids.

We hope this information was useful to our readers today,

and thank you for reading.

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