Basic Pension Dropouts Surge: Impact of Rising Real Estate Prices and How to Respond

The recent fluctuations in real estate assessed values have led to a sharp increase in the number of elderly individuals losing their basic pension eligibility. Many retirees are expressing strong dissatisfaction, as they are losing their pension benefits simply because the evaluated price of their residence exceeded the income recognition threshold, despite having no actual increase in their regular income.

The Direct Impact of Real Estate Price Changes on Basic Pensions

The basic pension is a core retirement income security system provided to the elderly aged 65 and older who fall into the bottom 70% income bracket. The Recognized Income Amount, which determines eligibility, is calculated by combining earned and business income with the converted income value of real estate and financial assets. As housing assessed values rose in certain regions this year, the converted income from assets for retirees surged, even without any corresponding increase in actual earnings.

Although the government adjusts the Eligibility Standard Amount annually to reflect inflation and the overall income and wealth levels of the elderly, there are limits to fully absorbing rapid short-term asset price volatility. This raises concerns about the emergence of a 'welfare blind spot,' where individuals are excluded from pension benefits despite no tangible improvement in their living standards, leading to growing demands for a reform of the basic pension calculation method.

Frequently Asked Questions (FAQ)

What should I do if I receive a notification of basic pension disqualification?

You can file an appeal at your local community center or a branch of the National Pension Service within 90 days of receiving the disqualification notice. If you submit documents proving changes in your assets, such as an increase in debt or the disposal of property, you can undergo a reassessment.

Why is my income calculated as high when I only own one house?

The basic pension calculates your monthly income by subtracting the basic property deduction (which varies by region) from your held assets (such as real estate) and applying an annual income conversion rate of 4%. Therefore, if the assessed value significantly exceeds the deduction limit, a high recognized income amount will be calculated even if you have no cash income.

Can I receive the pension again next year?

Yes, it is possible. A new eligibility standard amount is announced every January. If the assessed value of your property falls or your assets and income decrease, you can regain your eligibility by reapplying. By applying for 'Pension Hope History Management,' you will be notified when you meet the criteria in the future.