[Edaily Reporter Lim Yukyung ] The “Our Self-Reliance Fund,” which allows individuals to save up to 70 million won from birth until age 18 and receive full tax exemption on interest and dividend income, will be launched in the second half of next year. Although it is not eligible for government financial support, plans are also underway to allow children from households with incomes exceeding 150% of the median income and children born before August of this year to enroll in the fund.

The government announced the “Support Plan for the ‘Our Self-Reliance Fund’”—which includes these measures—in a joint statement by relevant ministries at an Emergency Economic Headquarters meeting and Economic Ministers’ Meeting held on the 1st and chaired by Deputy Prime Minister and Minister of Finance and Economy Lee Hyung-il.

Introduced to support young people in building their first assets, the fund provides a fixed annual subsidy of up to 1.2 million won until the child turns 18 for children in households with an income at or below 50% of the median income who were born on or after September of this year. For children in households with incomes between 50% and 100% of the median income, the government will provide up to 1 million won (a 1:2 matching ratio) for every 500,000 won contributed by the parents; for children in households with incomes between 100% and 150% of the median income, the government will provide up to 1 million won (a 1:1 matching ratio) for every 1 million won contributed by the parents.

The contribution period is up to 19 years, and the annual contribution limit—combining parental contributions and government subsidies—is 2 million won. Additional contributions may be made freely within this limit.

Interest and dividend income generated from investments in the “Our Self-Reliance Fund” through a dedicated account will be fully tax-exempt. Additionally, the government plans to apply tax-exemption benefits for a certain period even if the account is maintained rather than closed immediately after the 19-year contribution period ends. However, if the account is closed prematurely before the child turns 19, the amount equivalent to the tax exemption will be recovered; exceptions will be granted in cases of unavoidable circumstances.

The government is considering a plan to allow voluntary enrollment for children from households with incomes exceeding 150% of the median income—who are not eligible for financial assistance—as well as children born before August of this year, if they wish to participate. The government also plans to grant tax-exempt status on interest and dividend income for voluntary contributors’ self-paid contributions (up to 2 million won per year).

The government intends to finalize the fund’s operational plan through discussions with relevant agencies and experts, in parallel with the National Assembly’s deliberations on the budget bill and the amendment to the Act on the Limitation of Special Tax Exemptions. The target launch date for the fund is the second half of next year, following the completion of IT system development and operational preparations.