Retirement Financial Behaviour: How Important Is Being Financially Literate?

Using Item Response Theory to analyse survey data from a representative sample of 551 Swedish citizens, a new 16-question measure of fact-based financial literacy is developed and validated. Uni-dimensionality of the measure is verified, and expected correlations are observed with an existing measur...

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Bibliographic Details
Published inJournal of consumer policy Vol. 43; no. 3; pp. 543 - 564
Main Authors Hauff, J. C., Carlander, A., Gärling, T., Nicolini, G.
Format Journal Article
LanguageEnglish
Published New York Springer US 01.09.2020
Springer Nature B.V
Subjects
age
Behavior
Business Administration
Commercial Law
correlation
Economic Policy
Financial literacy
Financial literacy Financial retirement behaviour Survey data Literacy measures
Financial planning
Företagsekonomi
gender
income
issues and policy
Item response theory
Literacy
Marketing
Original Paper
planning
Retirement
Retirement planning
Savings plans
Social Sciences
surveys
Sweden
Financial literacy
Literacy measures
Financial retirement behaviour
Survey data
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Summary:Using Item Response Theory to analyse survey data from a representative sample of 551 Swedish citizens, a new 16-question measure of fact-based financial literacy is developed and validated. Uni-dimensionality of the measure is verified, and expected correlations are observed with an existing measure of fact-based financial literacy, a measure of subjective financial literacy or confidence, and age, gender, and income. A significant impact of fact-based and subjective financial literacy are found on three time-ordered stages of individuals’ retirement behaviour: planning, saving, and investment management. It is concluded that policies increasing final literacy are important in different phases of the life cycle.
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ISSN:0168-7034
1573-0700
DOI:10.1007/s10603-019-09444-x