Investor decision making within retirement savings schemes

Christopher Bebbington, Robert B. Durand and Joyce Khuu

Pacific-Basin Finance Journal, 2024, vol. 83, issue C

Abstract: We study the investment allocation decisions of over 32,000 investors in a retirement savings program using data from 1994 to 2019. Investors exhibit a “reduce risk or increase risk response” when faced with signals of increased market volatility. Investors behave as if they perceive patterns in prices. Different age cohorts display different decision-making “cultures”, but all age groups display a bias towards choosing less risky allocations rather than riskier strategies. Our findings suggest that behavioral biases can contribute to lower superannuation balances being available to people when they retire.

Keywords: Behavioral finance; Retirement savings; Superannuation; Personal finance (search for similar items in EconPapers)
JEL-codes: G41 G51 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:83:y:2024:i:c:s0927538x23002743

DOI: 10.1016/j.pacfin.2023.102203

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