Risky Indebtedness Behavior: Impacts on Financial Preparation for Retirement and Perceived Financial Well-Being

Kelmara Mendes Vieira (), Taiane Keila Matheis and Ana Maria Heinrichs Maciel
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Kelmara Mendes Vieira: Public Administration Program, Federal University of Santa Maria, Santa Maria 97105-900, RS, Brazil
Taiane Keila Matheis: Public Administration Program, Federal University of Santa Maria, Santa Maria 97105-900, RS, Brazil
Ana Maria Heinrichs Maciel: Public Administration Program, Federal University of Santa Maria, Santa Maria 97105-900, RS, Brazil

JRFM, 2023, vol. 16, issue 12, 1-19

Abstract: This study aimed to verify the impact of financial preparation for retirement and risky indebtedness behavior on perceived financial well-being. A survey was carried out with 2290 individuals from diverse sociodemographic and economic profiles who resided in Brazil. Confirmatory factor analysis and structural equation modeling were used as data analysis techniques. The results obtained indicate that risky indebtedness behavior negatively impacts financial preparation for retirement and perceived financial well-being and that there is a positive impact of financial preparation for retirement on perceived financial well-being. These findings highlight the importance of financial planning and savings behavior so that future expectations are achieved, and individuals may enjoy life with financial well-being. Thus, it is essential that public policies that promote new behaviors and healthy financial habits to the population, in addition to incentives for financial preparation for retirement, are built. Brazil needs to review the new credit concessions so that the individual does not acquire the behavior of using a financial resource that they do not have and that compromise financial well-being in the short and long term, negatively affecting retirement.

Keywords: indebtedness; financial well-being; risky indebtedness; retirement preparation; behavioral finance; personal finance; financial decisions (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2023
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