Student loans, living costs push young Koreans into 61.2 million won debt

A growing number of young South Koreans are finding themselves buried under significant debt, often exceeding 60 million won, not from reckless spending but from the sheer cost of basic necessities and education. Lawyer Park Ki-tae, who specializes in personal bankruptcy and rehabilitation cases, shared the story of a young man who graduated with 40 million won in debt from student and living expenses loans. This debt ballooned to 61.2 million won after two years of job searching, during which he took out additional loans for a tiny 0.7-pyeong room, certification exams, and food.

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These young people are not foolish. It is a coldly calculated decision. If the result of a safe choice is guaranteed relative poverty, choosing a small possibility of hope becomes not recklessness but a rational choice.

Park describes these individuals as 'diligently ruined.' He notes that many of the young debtors he counsels are not irresponsible or extravagant. Instead, they are individuals who have strived to live diligently on their own but find themselves unable to achieve a stable life. Their credit card statements often reveal not lavish purchases, but humble expenses like 3,500 won for convenience store items or 4,000 won for study cafes, reflecting a desperate struggle for survival.

While acknowledging that some young people incur debt through riskier ventures like speculative investments ('bit-too'), cryptocurrency, or even falling victim to employment scams, Park argues against placing the blame solely on individual choices. He points to the systemic issues of economic despair, the difficulty of achieving financial stability through labor income alone, and the widening wealth gap as factors pushing young people toward more precarious decisions. He contends that these choices are often rational calculations made in the face of near-certain relative poverty if only relying on traditional means.

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The interest debtors pay is a kind of insurance premium that financial companies receive in return for taking on the risk of default. If you have diligently paid your interest, you do not need to feel sorry to the insurance company when you have an accident. Loans are the same. If you have paid interest diligently, you do not need to blame yourself when you are in a situation where you can no longer repay.

Park emphasizes that personal rehabilitation and bankruptcy are rights, not reasons for guilt. He explains that the interest paid on loans is essentially an insurance premium for the lender's risk. "If you've diligently paid your interest, you shouldn't feel guilty when you can no longer repay the debt," he stated. He urges young people struggling with debt not to suffer alone but to utilize the legal system, calling personal rehabilitation "your right and a second chance provided by the state."

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Personal rehabilitation is your right and a second chance provided by the state. Please do not try to endure it alone and collapse; seek help through the system.