‘Are you paying dividends?’ An investment bankbook that only people you know take care of

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[이데일리 이미나 기자]

[이데일리 전선형 기자] “If you sign up for an investment account, you can receive dividends.” Kim Ah-reum, a newcomer to society, recently visited Saemaul Geumgo to open a monthly salary account, and heard an encouraging story from a bank teller. It was said that if you create an investment account, you can receive year-end dividends and enjoy tax-free benefits for savings and savings made in the future. Kim Ah-reum said, “I hesitated a bit because it said that it was not possible to protect depositors, but I decided to give it a try because I thought it would be less risky than stocks.”

Recently, the ‘shared bankbook’ of mutual finance is gaining popularity among the financial tech people. This is because it has the advantage of not being taxed up to a certain amount while taking dividends that are higher than interest on savings and savings accounts. According to the financial industry on the 31st, the balance of investment accounts between Saemaul Geumgo and credit unions as of September was 16.3324 trillion won, up 13.4% from the same period last year. The amount increased by 2 trillion won. Compared to January last year, it increased by 25.8%.

An official from mutual finance said, “The number of union members continues to increase, but in particular, as the low interest rates continued last year, many people sought mutual finance to receive high interest rates.” There are quite a few people who are constantly increasing the amount because of this stinginess.”

In order to understand the investment account, you must first understand the concept of mutual finance. Mutual finance is a type of ‘reciprocal finance’ that seeks to facilitate mutual fund flow between members by lending them to members. In other words, after collecting funds by forming a community (cooperative), it deals with limited forms of deposits and loans. In Korea, there are credit cooperatives (credit cooperatives), agricultural cooperatives, fisheries cooperatives, forestry cooperatives, and Saemaul Geumgo that engage in mutual financial business in Korea. Of these, credit unions and Saemaul Geumgo are cooperatives for local residents, and the rest are cooperatives for workers in agriculture and fisheries.

An investment bankbook is a bankbook in which the capital to be paid when joining a mutual finance company as a member is stored. It is similar to the concept of buying stock in a corporation and becoming a shareholder. The paid-in capital is used as a financial resource to pay dividends at the end of the year after each mutual finance is operated. In order to open a savings account, you need only your ID card, and if an agent opens a bank account, you need your ID, agent ID, power of attorney, family relationship certificate, and a copy of resident registration.

The reason why Jaetech people are interested in investment accounts is because of dividends. The investment bankbook is the same concept as stocks, and dividends are paid when the cooperative manages the investment well and produces profits. The dividend rate is determined at the regular general meeting of the year following the payment of the investment, and although it varies for each unit association, the average is 2-4%. The average dividend rate of Saemaul Geumgo in 2019 was 3.21%, and the average dividend rate last year was 2.82%. The average dividend yield of the credit union last year was 2.7%. As the base interest rate fell to the lowest level last year and business became difficult due to the corona virus, the average dividend yield fell slightly.

In particular, dividend income from the investment account is all tax-free. For example, if you have 10 million won in your investment account and you receive a dividend of 400,000 won, you can keep 10.4 million won as it is not taxed. However, the tax-free limit of the investment bankbook is limited to 1,000 won. In addition, if you create an investment account, you can enjoy tax-free benefits of 30 million won on deposits and savings accounts. Of course, if you get a loan from the association, you can enjoy benefits such as giving a preferential interest rate depending on the association.

The amount of money that an individual can put into the investment account differs for each mutual finance, but Saemaul Geumgo cannot exceed 15/100 of the total number of investment accounts, and credit unions are also limited to less than 10/100 of the total investment. Of course, it is rare to put a large amount in the investment account. In most cases, 10 million won is the maximum amount that can be enjoyed tax-free.

Investment bankbooks have attractive advantages, but also have distinct disadvantages. First of all, there is no depositor protection. Since the concept is the same as stocks, you cannot get your money back if the association goes bankrupt, etc. For this reason, it is advisable to check in advance whether it is a good place through the management disclosure of the relevant mutual financial association.

In addition, although you can keep putting money in the investment account, you cannot freely withdraw money. Even if a member leaves the union midway and closes the bankbook because of the urgent need for money, the money cannot be returned until the financial year settlement of the association is completed.

An official from the financial sector said, “The investment bankbook is not a product for financial technology. It has to be made,” he said.

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