[Anchor]

It is Tuesday, and we have our "Friendly Economy" segment with reporter Han Jiyeon. Han, office workers face a period of income vacuum between the official retirement age and when they actually start receiving their pensions.

[Reporter]

That is correct. The mandatory retirement age is 60, but pensions are paid starting at age 63, leaving a three-year gap.

"I only realized the income cutoff when I saw my bank balance shrinking." These are the words of retirees interviewed by the Korea Institute for Health and Social Affairs.

The pension eligibility age has been pushed back by one year every five years since a reform in 1998.

It started at age 61, is currently 63, and will reach 65 by 2033.

Those born between 1961 and 1964 find themselves in a blind spot where they must survive for three years from age 60 without a pension.

The gap widens further to four years for those born between 1965 and 1968, and to five years for those born from 1969 onward.

Consequently, they cannot afford to stop working.

During this period, 83 percent of household income comes from working.

The economic participation rate for those in their early 60s—meaning the proportion of people who are working or looking for work—rose from 57 percent in 2011 to 66.7 percent last year.

The issue is the quality of these jobs.

Six out of ten newly found jobs during this interval were temporary or daily positions.

While 59 percent of those who remained in their original workplaces were regular employees, only 22 percent of those who found new jobs attained regular status.

The median monthly wage was also more than 400,000 won lower.

Moreover, even when the head of the household was pushed out of the job market, the offsetting effect of spouses increasing their work hours was negligible.

[Anchor]

If people fail to work until the mandatory retirement age, the income gap must become even wider.

[Reporter]

People try to endure by working or cutting back.

However, seven out of ten households that experienced a sharp drop in income ran deficits.

When earnings plummet drastically, households naturally cut spending first.

Households with steeply reduced incomes spent only one-third as much on dining out, leisure, and clothing compared to households that maintained their income levels.

Even after doing so, they could not avoid deficits.

In-depth interviews revealed that with elderly parents' caregiving costs, medical bills, and soaring food prices piling up, there was simply nothing left to cut.

At this point, you might wonder, "Why not just receive your pension early?"

As you might expect, the number of people newly receiving the reduced old-age pension—which decreases by 6 percent for every year it is brought forward—has more than doubled over the past decade.

However, pension payouts correspond to how long insurance premiums were paid; short contribution periods mean smaller payouts, and bringing them forward results in further reductions, offering little help to financially strained households.

Looking solely at households receiving public pensions, those with stable incomes received around 1.9 million won per month, whereas those with sharp drops received only about 500,000 won.

That is a difference of more than three times.

Most assets are tied up in real estate like housing, but cases of selling one's home to cover living expenses were hardly noticeable.

Ultimately, neither pensions nor housing served as proper safety nets.

Researchers referred to this vulnerable group as the "generation left behind by pensions."

They suggested raising the retirement age in phases to match the pension eligibility age and introducing a partial pension system that allows people to receive a portion of their pension early as needed.

[Anchor]

The last topic is about ways to save on insurance premiums when purchasing car insurance for the first time.

[Reporter]

If you register as a driver under your parents' insurance and drive without an accident for three years, your first car insurance premium drops by nearly half.

Many of you have probably been shocked after receiving your first car insurance quotes.

Insurance premiums vary depending on driving experience and accident history, so taking out a policy for the first time inevitably brings high costs since no experience has accumulated.

However, the period you spent listed as a driver on your parents' insurance is recognized as your own driving experience for up to three years.

Let us look at an example from the Financial Supervisory Service.

If a 28-year-old buys a 20 million won Avante for the first time and takes out insurance under the condition of driving alone, the premium is 1.33 million won.

If they are credited with three years of accident-free driving experience while operating their mother's car, that amount drops to 72万 won.

However, to be recognized as accident-free, everyone registered under that policy must have been accident-free for the past three years; if the mother caused an accident, only the driving experience period is recognized.

If parents designate their children as beneficiaries for driving experience recognition when purchasing their insurance, it is acknowledged without paperwork, and up to two people can be included per contract.

Even if you have never driven your parents' car, periods spent driving as a military driver or operating long-term rental cars are also recognized as experience.

Combining a year and a half of each makes three years, saving nearly 400,000 won.

Periods spent working in driving positions at public offices or companies are also recognized.

Even if you forgot when signing up, you can apply later to get the overpaid insurance premiums refunded.

To ensure people do not miss out due to a lack of awareness, the system is changing starting this month so that insurance companies must guide customers from the moment they sign up for insurance.