The savings and investment decisions of planners
a cross-sectional study of college employees
DOI:
https://doi.org/10.61190/fsr.v16i2.4883Keywords:
Investments, Employee benefits, Risk tolerance, Financial planning, Pensions and retirement planning, Personal financeAbstract
We report the results of a survey of college employees who are eligible for their institution's 403(b) plan. We evaluate each employee's "propensity to plan," which is found to be driven by a single psychological factor. Pension contributions are positively correlated with the propensity to plan. Other demographic attributes such as gender, marital status, age, and salary also matter. Surprisingly, men saved less than women did. We also created a subjective risk-tolerance score for each participant, and conclude that those with a higher propensity to plan are more risk tolerant. Risk taking is positively associated with income, and (surprisingly) negatively associated with age.
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