Psychological determinants of retirement financial planning behavior

Various studies raise concerns over the pervasive poverty among women after retirement. Although much research is available on retirement planning, the advent of behavioral finance and the integration of psychological concepts with financial planning and saving behavior have made the phenomenon more critical. This study focuses on how the interaction between financial literacy as a cognitive characteristic and retirement goal clarity, future time perspective, attitude toward retirement, risk tolerance, and social group support as psychological characteristics influence women’s retirement planning behavior. We use partial least squares regression through PLS-3 with Multi Group Analysis to test a set of theory-based hypotheses. Our results reveal a positive association of future time perspective, retirement goal clarity, and social group support with retirement planning behavior, which are moderated by financial literacy. Future time perspective and retirement goal clarity also play mediating roles. Our study has implications for financial planning professionals, advisors, and consumers.