Economics at your fingertips  

Financial literacy, debt, risk tolerance and retirement preparedness: Evidence from New Zealand

Jelita Noviarini, Andrew Coleman, Helen Roberts and Rosalind H. Whiting

Pacific-Basin Finance Journal, 2021, vol. 68, issue C

Abstract: This study investigates the effect of financial literacy on debt ownership, debt anxiety and risk tolerance of older individuals. Contrary to prior evidence that financial literacy is not associated with retirement planning in New Zealand our findings suggest that financial literacy is important for retirement preparedness. “Advantage” (high income and education) is a strong factor common to higher financial literacy that results in less debt anxiety or higher risk tolerance/willingness to take more risk. The relationships between financial literacy and risk tolerance and between financial literacy and debt anxiety are complex and vary by subsample cohort and indicate that assuming a simplified nature between these factors may result in misleading relationship generalisations.

Keywords: Financial literacy; Retirement; Risk tolerance; Debt anxiety; Endogeneity; Structural Equation Modelling (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

DOI: 10.1016/j.pacfin.2021.101598

Access Statistics for this article

Pacific-Basin Finance Journal is currently edited by K. Chan and S. Ghon Rhee

More articles in Pacific-Basin Finance Journal from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

Page updated 2022-01-04
Handle: RePEc:eee:pacfin:v:68:y:2021:i:c:s0927538x21001050