The average disposable income among the house poor stands at W2.46 million (US$1=W1,125) a month, and W1.02 million of that goes into repaying the principal on mortgages. Some 20 percent of Koreans in their 30s fall into the house poor category, and 14 percent of those in their 40s. The HRI said 90,000 out of the 1.08 million households are unable to repay their mortgage.

According to the Hyundai Research Institute, 1.08 million out of 10.8 million households in Korea or 10.1 percent are classified as being "house poor." The institute classifies an individual as house poor if more than 10 percent of his or her disposable income goes into meeting principal payments on their mortgage.

The most worrying aspect is that thousands of middle-aged people in the prime of their professional careers are struggling under mountains of debt.

The number of indebted people is increasing across all age groups in Korea, from young couples struggling to start their own family and people with mortgages to middle-aged parents burdened with exorbitant education costs for their children and even elderly people with little money for their later life.

Many young couples have taken out loans to pay for their weddings and cover their "jeonse" or Korean-style deposit lease. According to a survey by the Ministry of Gender Equality and Family on 4,754 people, marriage expenses amount to W80 million on average for men and around W30 million for women.

Statistics Korea puts the median assets of Korean couples under 30 at W41.46 million as of 2011. That means young couples are taking out loans twice the size of their assets in the early stage of their married lives. It is nearly impossible to get married these days without getting into debt unless parents pitch in.

According to the Korea Institute for Health and Social Affairs, raising a child costs a total of W262 million. It costs W880,000 a month to raise an elementary schoolchild, W980,000 a child in middle school, W1.15 million a child in high school and W1.42 million a child in college. Increased spending on tuition fees and private crammers translates into less money saved.

The Seoul National University Institute on Aging says the baby-boomer generation born between 1955 and 1963 manage to save up only W170,000 a month to prepare for their retirement. They spend most of their money on their children’s education costs, with little savings and even debts. This can mean they end up poor in old age.

OECD data show the poverty rate among Korean senior citizens is 45 percent, much higher than the OECD average of 13.3 percent. The situation is even worse for senior citizens who live alone. According to the Samsung Economic Research Institute, the poverty rate among elderly people living alone stands at 77 percent, the highest in the OECD.

Ex perts say households need a strategy to escape the vicious circle of overspending and borrowing from wedding to retirement. Yoon Chang-hyun at the University of Seoul said, "Since it is clear Korea has entered a low-growth stage, people should not rely on debts to invest and aggressively cut spending on education for their kids and other expenses."