Hand-in-hand in the golden years: Cognitive interdependence, partner involvement in retirement planning, and the transition into retirement

This research examined the influence of cognitive interdependence—a mental state reflecting a collective representation of the self-in-relationship—on the anticipation for and experiences with the transition into retirement. Among soon-to-be retirees (Study 1), greater cognitive interdependence was associated with seeing partners as more instrumental to one’s goals both pre- and post-retirement, anticipating greater goal alignment post-retirement, and having directly involved partners in retirement planning to a greater extent than those relatively lower in cognitive interdependence. Among recent retirees (Study 2), retrospective cognitive interdependence was associated with post-retirement goal alignment and goal instrumentality, and the extent to which they believed they had directly involved their partners in retirement planning. However, it was post-retirement goal alignment that was associated with greater ease of retirement and subjective well-being. Finally, soon-to-be retirees relatively high in cognitive interdependence responded to concerns about their retirement (i.e., goal discordance and high retirement ambivalence) by wanting to involve their partners in their retirement plans to a greater extent (Study 3). These studies highlight the importance of romantic partners across the lifespan, and how partners might influence retirement planning, the transition to retirement, and well-being among recent retirees.

Less is not more: 401(k) plan information and retirement planning choices

This paper presents the results of a choice experiment that is designed to examine whether changing how plan information is presented affects planned retirement-savings behavior. The main hypothesis is that providing plan information in a more concise format with helpful recommendations, rather than providing lengthy and detailed information, will alter retirement-planning choices. The specific choices examined include: whether to enroll, how much to contribute, and how to structure (broadly) the asset allocation. The choice experiment is conducted on three different samples: (i) a Qualtrics panel of new employees, (ii) a Qualtrics panel of job seekers, and (iii) a sample of business-school students. Our results suggest that, controlling for demographic and other factors, our main hypothesis was not supported by the data in any of the samples. Thus, the data cast some doubt on the notion that simplifying and condensing the retirement-plan information presented to employees will result in vastly different retirement-planning choices.

The Effects of Gender and Marital Status on Accrued Debt in Retirement Planning

The effects of gender and marital status on accrued debt in retirement planning becomes an urgent concern because unmarried women face greater financial challenges in retirement than their counterparts. This study used data from the National Financial Capability Study (NFCS), designed by FINRA. We identified debt that influences retirement planning among a sample of pre-retirees, aged 51 to 61 years, and consider the associations of gender, marital status, debt, and retirement planning. Our results indicated that mortgage debt and credit card debt were negatively associated with retirement planning for women. Having a retirement account is positively associated with retirement planning and it also mediates the relationship between credit card debt and retirement planning. We urge women and financial planning executives to take time during the pre-retirement years to assess their various forms of debt and determine how it affects retirement planning objectives given current marital status.

Retirement Financial Planing and Life Satisfaction

Retirement has been considered as a major transition in one’s life. Financial security in retirement is a major concern for many Americans. Evidence has shown that being financially prepared for retirement could has a significant, positive impact on one’s life satisfaction. Employing data from the 2012 and 2018 National Financial Capability Study (N=1023), this study analyzes the relationship between participants’ retirement planning in 2012 and their financial satisfaction in 2018. An Ordinary Least Squares regression is used in the current study. This study found relatively low retirement preparedness levels (retirement planning, retirement saving, retirement plan: employer-based or individually held, investment) among the participants in 2012. Based on the descriptive results, adults closest to retirement (ages 55 to 64) are more likely to be planning compared to the other groups, as are adults who were married, highly educated, males, and white. According to the liner regression results, this study found that adults who had a retirement savings goal, had a retirement plan (employer-based or individually held), made regular contributions to retirement plans, and owned investments in 2012 are more likely to be satisfied with their personal financial condition in 2018. As expected, individuals with higher incomes, larger net worth, and those who are older are significantly more likely to be financial satisfied. However, even after controlling for these variables, results show that planning does indeed impact the level of financial satisfaction. Our findings highlight the importance of policies and programs to support Americans with retirement planning.

What drives working adults to be better prepared for their retirements?

PurposeThis study aims to understand the drivers that help working adults to be better prepared for retirement, by examining the relationship between financial literacy (FL), financial attitude (FA), financial well-being (FWB), financial behavior (FB) and retirement preparation (RP). RP includes multidimensional measures, which are retirement confidence, retirement planning, long-term financial planning and private retirement schemes (PRS) participation.Design/methodology/approachThis was a quantitative study adopting non-probability sampling with self-administered questionnaire distributed to all working adults. Descriptive analysis was used to examine the 294 useable data, and the multiple logistic regression analysis was adopted for hypothesis testing.FindingsThe empirical results show that FB is positively associated with RP and then followed by FWB on retirement confidence. Although insignificant influence is found on FL and FA, better FL and FA will still improve individuals' RP.Research limitations/implicationsThe study provides insights to working adults that practicing positive FB and good FWB will improve RP. Besides, for financial institutions, income level is the main determinant for consumers to participate in PRS; for policy makers, to incorporate financial attributes knowledge as part of the school curriculum since early school years.Originality/valueThis study is one of the few studies in Malaysia that explored FL, FA, FB and FWB on retirement planning, respectively.