Retire with Poor or Rich? Life Cycle Model Approach

  • Suhaila Abdul Kadir
  • Raja Suzana Raja Kasim
  • Noraani Mustapha
  • Muhamad Saufi Che Rusli
  • Muhammad Ashlyzan Razik
  • Azizah Musa
  • Wee Bee Fong

Abstract

Everyone think that retirement planning is too far for them. As a result, they fail to plan and save for their golden age. The purpose of this paper is to examine the four factors namely the financial self-efficacy, financial socialization, financial literacy and financial behavioural influence are the most important retirement planning among the working individuals in the private sector. Life cycle theory was use in determine Malaysians retirement planning. These studies are using the quantitative method. The study outcome will be beneficial to the government and non government in Malaysia. Policy maker will enhance and continually make improvement on how to create the awareness effectively regarding the importance of the retirement planning.

References

Abraham Ansong & Michael Asiedu Gyensare (2012). Determinants Of University Working- Students’ Financial Literacy At The University Of Cape Coast, Ghana, International Journal Of Business And Management, 7(9), 126-135.
Ahmisuhaiti, K., Ahmad, K., Hassan, R., & Idris, F. (2017). Influence of Financial Literacy on Financial Satisfaction with Financial Behavior as Moderating Variable. Asian Journal of Technical Voational Education And Training, 2, 1–9.
Andy Chua. (2015, Monday, 27 Apr). Study shows only 22% have retirement planTheStar Online.Retrieved from https://www.thestar.com.my/metro/community/2015/04/27/study-shows-only-22-have-retirement-plan/.
Asandimitra, N., & Kautsar, A. (2019). The influence of financial information, financial self efficacy, and emotional intelligence to financial management behavior of female lecturer. Humanities and Social Sciences Reviews, 7(6), 1112–1124. https://doi.org/10.18510/hssr.2019.76160
Asebedo, S. D., Seay, M. C., Archuleta, K., & Brase, G. (2019). The Psychological Predictors of Older Preretirees’ Financial Self-Efficacy. Journal of Behavioral Finance, 20(2), 127–138. https://doi.org/10.1080/15427560.2018.1492580.
Atkinson A, Messy F (2011) Assessing financial literacy in 12 countries: an OECD/INFE international pilot exercise. J Pension Econ Finance, 10(4):657–665.
Azaddin Ngah Tasir. (2016). Lavish living making more grads bankrupt. The Star.
Bakar, M. Z. A., & Bakar, S. A. (2020). Prudent financial management practices among Malaysian youth: The moderating roles of financial education. Journal of Asian Finance, Economics and Business, 7(6), 525–535. https://doi.org/10.13106/JAFEB.2020.VOL7.NO6.525
Beal DJ, Delpatchitra SB (2003) Financial literacy among Australian university students. Economic paper
EPF Annual Report. (2016).
Fisher, P. J., Hayhoe, C. R., & Lown, J. M. (2015). Gender differences in saving behaviors among low-to moderate-income households. Financial Services Review, 24(1), 1-13.
Franco, M. (1950). The Life Cycle Theory of Consumption. Princeton University.
Garman TE, Kim J, Kratzer CY, Brunson BH, Joo SH. (1999). Workplace financial education improves personal financial wellness. Financial Counselling and Planning, Volume 10 (1), 79 - 88.
Gautam, S., & Matta, M. (2016). Socio-Demographic Determinants of Financial Behaviour of Individual Investors in India Socio-Demographic Determinants of Financial Behaviour of Individual Investors in India. Journal of IMS Group, 13(August), 38–49.
Grohmann, A., Kouwenberg, R., & Menkhoff, L. (2015). Childhood roots of financial literacy. Journal of Economic Psychology, 51, 114–133. https://doi.org/10.1016/j.joep.2015.09.002.
Harnish, T. L. (2010). Boosting Financial Literacy in America: A Role for State College and Universities. New York: Perspectives, American Association of State Colleges and Universities, Fall.
Hogarth, J. M. (2002). Financial Literacy and Family and Consumer Sciences. Journal of Family and Consumer Sciences, 94(1), 14-28.
Ho, F. (2016). 9 In 10 Malaysians Have ZERO Savings, Says EPF imoney.mylearningcenter.
Ibrahim, D., Isa, Z. M., & Ali, N. (2012). Malaysian Savings Behavior towards retirement planning. Paper presented at the Proceedings of 2012 International Conference on Economics Marketing and Management.
Jessica. (2016, Thursday, 11 Aug). 92% of Malaysians worry about financial health. TheStarOnline. Retrieved from https://www.thestar.com.my/business/business-news/2016/08/11/92-of-malaysians-worry-about-financial-health/
Jorgensen, B. L., Rappleyea, D. L., Schweichler, J. T., Fang, X., & Moran, M. E. (2017). The Financial Behavior of Emerging Adults: A Family Financial Socialization Approach. Journal of Family and Economic Issues, 38(1), 57–69. https://doi.org/10.1007/s10834-015-9481-0
Joseph A. Tomlinson. (2010). Unmet Expectations. Retirement Income Journal. https://retirementincomejournal.com/article/unmet-expectations/
Kim, J. H., & Torquati, J. (2019). Financial Socialization of College Students: Domain-General and Domain-Specific Perspectives. Journal of Family and Economic Issues, 40(2), 226–236. https://doi.org/10.1007/s10834-018-9590-7.
Kim J, Garman TE (2004) Financial stress, pay satisfaction and workplace performance. Compensation & Benefits Review. Sage Publications, pp. 69 – 76.
Kumar, S., Watung, C., N. Eunike, J., & Luinata, L. (2017). The Influence of Financial Literacy Towards Financial Behavior and Its Implication on Financial Decisions: A Survey of President University Students in Cikarang - Bekasi. Firm Journal of Management Studies, 2(1), 169–179. http://e-journal.president.ac.id/presunivojs/index.php/FIRM-JOURNAL/article/view/158/87
Lown, J. M., Kim, J., Gutter, M. S., & Hunt, A. T. (2015). Self-efficacy and Savings Among Middle and Low Income Households. Journal of Family and Economic Issues, 36(4), 491–502. https://doi.org/10.1007/s10834-014-9419-y
Lusardi A, Mitchell OS, Curto V (2010) Financial Literacy among the young: evidence and implications for consumer policy. Journal of Consumer Affairs, 44 (2), 358 - 380.
Mak, V., & Braspenning, J. (2012). Errare humanum est: Financial literacy in European consumer credit law. Journal of consumer policy, 35(3), 307-332.
Narayanan, S. (2002), Old age support for private sector employees in Malaysia: Can the employees provident fund do better? Hitotsubashi Journal of Economics, 43, 119-134.
Nornisah Mohd Yusof. (2016). EPF: Some retirees spending all their withdrawals in 30 days. The Star.
Nur Haziqah A Malek (2019)‘RinggitPlus’ survey: 21% of Malaysians do not save.The Malaysian Reserve online.Retrieved from: https://themalaysianreserve.com/2019/10/07/ringgitplus-survey-21-of-malaysians-do-not-save/
Rai, K., Dua, S., & Yadav, M. (2019). Association of Financial Attitude, Financial Behaviour and Financial Knowledge Towards Financial Literacy: A Structural Equation Modeling Approach. FIIB Business Review, 8(1), 51–60. https://doi.org/10.1177/2319714519826651
Remund DL (2010) Financial literacy explicated: The case for clearer definition in an increasingly complex economy. Journal of Consumer Affairs, 44 (2), 276 - 295.
Sabri, M. F., & Juen, T. T. (2014). The Influence of Financial Literacy , Saving Behaviour
,and Financial Management on Retirement Confidence among Women Working in
the Malaysian Public Sector, 10(14): 40–51. doi:10.5539/ass.v10n14p40
Sudindra, V. R., & Naidu, J. G. (2018). Financial Behaviour and Decision-Making. International Journal of Creative Research Thoughts, 6(1), 1427–1435. https://doi.org/10.1729/IJCRT.17236
Suwanaphan, S. (2013). Personal Financial Literacy Of Academic Support. In Management, Knowledge amd learning International Conference (pp. 1061–1065).
http://www.akpk.org.my The Credit Counselling and Debt Management Agency. (2016).
Zabri, S. M., Ahmad, K., & Lian, A. A. L. H. (2016). The Awareness of Private Retirement Scheme and the Retirement Planning Practices among Private Sector Employees in Malaysia. International Journal of Economics and Financial Issues, 6(6S), 120-124.
Published
2021-09-01
How to Cite
ABDUL KADIR, Suhaila et al. Retire with Poor or Rich? Life Cycle Model Approach. International Journal of Advanced Research in Economics and Finance, [S.l.], v. 3, n. 3, p. 80-88, sep. 2021. ISSN 2682-812X. Available at: <https://myjms.mohe.gov.my/index.php/ijaref/article/view/15088>. Date accessed: 20 may 2024.
Section
English Section