Last year, households’ ‘surplus cash’ came to about 270 trillion won, the highest on record. Households’ net financial assets also expanded by about 656 trillion won. As households cut back on spending and their spare cash increased, a rally in domestic stocks led them to ramp up stock investment.

According to the Bank of Korea’s ‘2025 Flow of Funds (preliminary)’ released on the 9th, the net funds supplied by households (including sole proprietors) and nonprofit institutions amounted to 269.7 trillion won last year. This is the largest since these statistics began in 2009. The scale of net funds supplied increased by 54.2 trillion won from a year earlier, expanding even more than in the previous year (45.2 trillion won).

Net funds supplied is the value obtained by subtracting transactions in financial liabilities (fund-raising) from transactions in financial assets (fund investment), meaning spare cash. The Bank of Korea interpreted this as an increase in available funds as income grew faster than expenditures and the volume of new apartment move-ins declined.

Last year, the year-on-year growth rate of household spending was 2.2%, down 0.8 percentage points from the previous year (3%), while household income rose 3.5%, increasing more than in the previous year (3.3%). With a slowdown centered on domestic demand continuing, the growth rate of household spending has been on a downward trend for three consecutive years.

Households directed their spare cash into stocks. Excluding borrowings and other funding, households’ gross fund investment amounted to 342.4 trillion won last year, up by roughly 100 trillion won from the previous year (about 249 trillion won).

Deposits at financial institutions, including bank deposits (131.5 trillion won), also increased by about 18 trillion won from a year earlier, but the amount allocated to equity securities and investment fundswhich corresponds to stock investingsurged to 106.2 trillion won, more than doubling from the previous year (42.2 trillion won). The scale of equity-securities and investment-fund investment was the highest in four years, following 119.9 trillion won in 2021, when the ‘Donghak Ant Movement’ sparked an investment boom.

Kim Yong-hyun, head of the Bank of Korea’s Flow of Funds Team, explained, “It’s because stock prices rose, increasing the funds households invested in stocks and exchange-traded funds (ETFs).”

Funds households borrowed from financial institutions totaled 72.7 trillion won, more than doubling from the previous year (33.3 trillion won). Analysts say that, in addition to mortgage loans, increases in stock-related unsecured lending such as ‘borrowing to invest’ also played a role.

Looking only at financial assets, at the end of last year households’ financial assets totaled 6,201.9 trillion won, up 729.3 trillion won from the end of the previous year. Net financial assetsfinancial assets minus financial liabilitiesalso came to 3,760.7 trillion won, up 655.6 trillion won from a year earlier. The share of deposits in financial assets fell to 43.2% last year, down 3.2 percentage points from a year earlier, while the share of equity securities and investment funds rose to 26.5%, up 6.2 percentage points.