Abstract
Drawing on the model on financial planning for retirement (FPR), the aim of this work is to explore how parental economic socialization both directly and indirectly affects FPR through the mediation of financial literacy, financial planning decisions and financial management. Data from a sample of 280 participants aged between 45 and 63 years were used. The results show that parental economic socialization directly and indirectly influences FPR. Moreover, parental economic behavior acts as a positive model for the development of financial literacy and skills and for decisions about FPR. All the variables increased the explained variance of FPR. Lastly, we discuss the process by which parental economic socialization is positively related to financial literacy and skills that impact on FPR, indicating some implications and future lines of research.
Highlights
We currently live in a time of great economic changes, and the need to save for retirement is determined by the rise in the cost of living in the future and by the augmentation of the older population (Annoni and Weziak-Bialowolska, 2016; Budowski et al, 2016)
This study examines the influence of parental economic socialization on financial planning for retirement and the mediating role of financial literacy, decisions about FPR and financial management, based on the model on FPR of Hershey et al (2013)
We analyzed the relation of parental economic socialization with FPR, both directly and considering the variables financial literacy, decisions about FPR and financial management as mediators
Summary
We currently live in a time of great economic changes, and the need to save for retirement is determined by the rise in the cost of living in the future and by the augmentation of the older population (Annoni and Weziak-Bialowolska, 2016; Budowski et al, 2016). This study examines the influence of parental economic socialization on financial planning for retirement (hereafter FPR) and the mediating role of financial literacy, decisions about FPR and financial management, based on the model on FPR of Hershey et al (2013). Despite the fact that the Hershey’s model provides answers to a wide range of present questions about FPR, further exploration of remote antecedents is needed in order to refine our understanding of FPR (Topa et al, submitted). This model states that FPR is determined by three dimensions: capacity, disposition, and opportunities to plan and save, as well as by the interaction that occurs between them
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