In 2005, the first introduction of retirement pension plans such as defined benefit, defined contribution, individual retirement accounts has brought in the bigger values of one’s old age living security. On the course of deliberation to improve country’s retirement system arisen from the lifted public pension’s financial deterioration, the increased needs of private pension’s invigoration has highly been raised.
Accordingly, through the building of public & private pension structures, Korea also has matched and harmonized with 3 layered pension structure that formerly OECD, ILO, and World Bank have recommended. This progress is expected to be much helpful for overcoming the financial difficulties in public pension and to cope with retiree’s living issues.
At a glimpse, newly set up and validated through an amendment, private pension in Korea seemed to cover most of employees’ retirement life even when it still had blind spots of small business retiree’s absence for old age living preparation, who had not been eased or allowed signing themselves up for retirement schemes in the meantime.
In order to take the small business laborers into the coverage of IRP, there have been several specifications to deal with, A withdrawal permission issue of its halfway, Dullness of IRP effect & Insufficient retirement readiness in small businesses, No capability in utilizing IRP & Excessive cost to small businesses individuals, Lack of supportive service.
In Korea, individual retirement pension’s excellent operations and the step forward to the small businesses employees’ retirement supports, above issues should be cleared out and seek clues by reviewing developed and matured precedent IRP in other OECD countries, U.S.A, U.K, New Zealand.
They provided with advanced models and positive control systems, conducts in reference of immediate IRP settlement; Auto-Enrollment & taking a contribution holidays, Diversified plans & supply of training programs for practical effect of IRP utilization, A government subsidy, Federation of Small businesses & Establishment of public regulatory agencies.