None. The savings accounts don't give interest unless there have been some changes in the last few years. However, most or all banks offer contracts where you agree to put in so much every month and you get interest on that amount. The longer the contract, the more the interest. If you don't put in the money or if you pull the money out before the contract ends, you forfeit all the interest. I don't know if this is available to foreigners, but it could be worth a look if you got someone to help you with language or if you are fluent in Korean. Also, the smaller second and third tier banks will offer the best interest rates for these programs.
Everyday savings accounts pay interest but it's so low it makes little impact.
You should call around. I think one year term deposits(예금) are about 3.8% right now.
Standard Charter first bank offer a savings account which is available to Foreigners too - no minimum deposit and interest is paid monthly and there is no penalty for removing your money.
The account name is 'do dream account' and interest rate is 3.6% (not brilliant but easy access)
If you want to guarantee deposits monthly and a fixed time there are some slightly higher accounts available
Interest rates are too low but that is by central bank design. They would rather appeal to the masses to buy more things on time and keep the payment plan debt train rolling. It is unfortunate as my wife and and I are savers not spenders and are cheated out of a decent return.
I'm not happy with the rates of return but I sleep well at night knowing they are assured by the bank deposit insurance company. I have term deposits because I don't want to speculate in stocks and bonds or real estate. We have enough real-estate as it is.
What I find very amazing is in passing conversation the advice I get from people who don't have the kind of cash money that my wife and I do yet they still tell me what I should do with money. I kindly listen to their advice but never take it. We didn't inherit any money either if that's what some of you are thinking. We underconsumed and saved, nothing fancy, no get rich quick sceme. Saving and time, many years in fact and some interest, that's it.
There is nothing wrong with term deposits, yes currently the rates are too low but it's safe, convenient and easy.
Korean Exchange Bank has several time deposit options, for Korean won or foreign currencies. The Korean won 6 month time deposit in October of 2011 was 4.3% I think and the 12 month was 4.5%. The foreign currency time deposit rates were all differerent. USD was obviously next to zero, while AUD and another one or two currencies were around 5%.
They also can set you up with a money market account, which they told me is guaranteed unless the governement fails. The money market fund rate varies. At one point I was getting 4.5%, at one point 2.0%. You can withdraw your money at anytime.
All the talk of competing single digit percentages can overshadow the main thing, which is earn more income and spend less money. Bum-Suk is right in that simply not living a life of profligacy will make you a lot more money at the end of the year on your bank statement balance than your measely percentages of return from a savings/deposit/trust account.
If you planning to be here for a while and you don't have a lot of up front cash, you can set up a monthly deposit schedule (we did it for two years, but I imagine you can do one) where you garuntee to deposit a certain amount of money every month..you take a bit of a hit on the interest rate, ours was around 4%, but the interest will be paid out on the total deposit over the time period, thus if you did 1,000,000/month for two years you would be paid 4% of 24 million, so you can earn interest for money you have not deposited yet. I personally also like it because it provides an incentive to defintiley save a certain amount every month. Also, if you have a Korean friend you really, really trust it's better to have them set it up in their name as there is a significant difference between the tax rate on interest accrued between Koreans and foreigners.
KEB has an account called Number N° seems to be one of the best. I visted the bank two weeks ago.
Three year time deposit at 5.47%
Two year time deposit at 5.17%
You can not open this account on the internet. You have to visit the bank to do it.
Can someone tell me the interest rates for fixed deposit or term deposit in a korean bank?
If you are a foreigner married to a Korean you can open a savings account that pays more interest than the average account... Maybe 5.2% .. I have forgotten the exact rates but different banks have different rates... They are really designed for poor farmers married to foreign women but any waygookin/Korean couple can take advantage .... I think we have 3 with different banks for 3 years. Though I don't think the interest is compounded ... but I could be wrong...5.2% is great in comparison to a lot of countries.Like LBS said sometimes its just nice to know that little nest egg is growing and won't get lost .. Short term stocks are really risky .. So are commodoties.. Housing stock is ok, however, I can see that stagnating a while till everyone gets use to the new rules regarding getting mortgages..Anyway you need a big chunk of change to invest in property..The ass is falling out of the won ... no one wants it... The US is raising interest rates soon.. Korea is using QE and consumerism to try and drag itself up, but it hasn't worked in Europe and it won't work here...
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