'Mirae Asset Investing and Steady Pension Receiving Fund' Launched... Industry's First Withdrawal Solution Introduced

Mirae Asset Global Investments announced on May 19 that it has launched the industry’s first investment product for pension withdrawal clients, called the 'Mirae Asset Investing and Steady Pension Receiving Fund'.

The Mirae Asset Investing and Steady Pension Receiving Fund (Steady Pension Fund) offers an optimal investment solution for retirees who withdraw and live off their pension accounts. This is the first fund among domestic pension funds to provide a withdrawal solution specifically targeting retirees.

Until now, the domestic pension fund market has focused on accumulating pension assets based on the profitability of pension funds, such as Target Date Funds (TDFs). However, with the retirement of the baby boomer generation, there is a growing need for stable pension asset withdrawal solutions to secure post-retirement living expenses, making it necessary to shift perspectives on pension investment.

To ensure stability in pension withdrawals, the Steady Pension Fund pays a fixed monthly distribution (fixed amount payment). For an investment principal of 100 million KRW and a purchase price of 1,000 KRW per unit, investors can receive a monthly distribution of 417,000 KRW. The fixed monthly distribution rate relative to principal is 0.417%, which translates to an annualized rate of 5%. The distribution is primarily funded by the fund’s operating profits, with a portion of the principal used if necessary. Based on these fixed monthly distributions, retirees are expected to enjoy a more stable retirement life.

The Steady Pension Fund secures stability through global asset allocation. It diversifies investments by allocating 40% to risky assets such as global equities and alternative assets, and 60% to safe assets such as global bonds, pursuing both capital gains and income returns. Depending on market conditions, the allocation can be adjusted up to 50% for risky assets and up to 80% for safe assets, allowing for risk management and the expectation of stable long-term performance.

Son Sujin, Head of ETF Pension Marketing at Mirae Asset Global Investments, stated, "During the accumulation phase, it is important to build up earned income and pursue returns, while in the withdrawal phase, the key is to preserve the principal and receive pension payments for a longer period in a stable manner. We expect the Steady Pension Fund to become a leading stable withdrawal solution in Korea’s pension withdrawal market."

The Steady Pension Fund can be subscribed to both online and offline through Mirae Asset Securities. It is available for individual pension and retirement pension accounts, as well as general accounts.