South Korean households have a much lower proportion of financial assets than those in the United States and Japan as they focus more on property and other tangible assets, a report showed Monday.
Local households' financial assets stood at 21.4 percent of their total assets, compared with 67.1 percent for the U.S. and 60.5 percent for Japan, according to the report by the Korea Financial Investment Association (KFIA).
The report is based on a survey of a combined 4,440 individual investors in the three countries about their investment behavior.
"South Korean households invest too much in tangible assets such as houses and buildings," the KFIA said. "They need to increase investment in highly liquid financial assets to prepare for the fast-changing economic environment and aging population."
Cash and bank deposits accounted for the largest 45.3 percent of South Korean households' financial assets, compared with a mere 14 percent for the U.S., according to the report.
The percentage of South Korean households' financial assets to gross domestic product checked in at 189.3 percent, dwarfed by 333.6 percent for the U.S. and 308.1 percent for Japan, the report said.