Accumulating and spending retirement assets

A behavioral finance explanation

Authors

  • Diane K. Schooley College of Business and Economics, Boise State University
  • Debra Drecnik Worden College of Business, George Fox University, Newberg, OR

DOI:

https://doi.org/10.61190/fsr.v22i2.4650

Keywords:

Behavioral finance, Risk aversion, Annuitization, Retirement planning

Abstract

Increasing uncertainty surrounding social security benefits and public sector pension plans is pushing retirement savings into the spotlight. This study finds that education, financial discipline, and financial sophistication increase the likelihood of participating in a pension or an IRA/Keogh plan. Financial distress decreases the likelihood of setting aside additional funds in an IRA/Keogh plan. Further, the likelihood that an eligible individual will decline an offered pension plan decreases with education and financial discipline and financial sophistication. Controlling for health and marital status, the choice to annuitize retirement assets decreases with age and the desire to take risk.

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Published

2013-06-30

How to Cite

Schooley, D. K., & Worden, D. D. (2013). Accumulating and spending retirement assets: A behavioral finance explanation. Financial Services Review, 22(2), 173–186. https://doi.org/10.61190/fsr.v22i2.4650

Issue

Vol. 22 No. 2 (2013): FSR Summer 2013

Section

New Original Submission

License

Copyright (c) 2013 Academy of Financial Services

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