Pension plan participant choice: Evidence on defined benefit and defined contribution preferences

Gerrans, Paul; Clark, Gordon L.

doi:10.1017/s1474747213000061

Cited by 24 publications

(22 citation statements)

References 55 publications

(53 reference statements)

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“…Salary and Account Balance both had a positive association with being in all three calling groups and a negative association for the Not Called group. This is consistent with other evidence of non-default activity by members in a single-sector fund (Dobrescu et al 2018;Gerrans and Clark 2013). However, the magnitudes are small.…”

Section: Calling Behaviour: Marginal Effects-direction Of Influencesupporting

confidence: 91%

Determinants of seeking advice within defined contribution retirement savings schemes

Clark

Fiaschetti

Gerrans

2018

Accounting & Finance

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We report results from a study of superannuation member advice-seeking within their plan, explaining observed patterns by member age, gender, issue salience, and size-of-bet effect. Inquiry mode, frequency and volume of contact with the advice-provider, and sensitivity of members to legislative change and macroeconomic events are considered. Results show that gender (female more likely than male), age (older rather than younger), balance (larger rather than smaller) and experience (longer rather than shorter), are the strongest advice-seeking predictors, consistent over time. Findings suggest member engagement around retirement planning may be more effective when considering the factors affecting advice-seeking behaviour in general.

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Section: Calling Behaviour: Marginal Effects-direction Of Influencesupporting

confidence: 91%

Determinants of seeking advice within defined contribution retirement savings schemes

Clark

Fiaschetti

Gerrans

2018

Accounting & Finance

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“…As recently as 2005, they found the existence of private sector defined-benefit pension plans restricted to a small percentage of unionized employees in certain industries. Gerrans and Clark [10] found Australian pension plan participants voluntarily switching from defined-benefit to defined contribution plans. Recently, pension plans offered to new employees tended to be defined contribution, if any.…”

Section: Literature Reviewmentioning

confidence: 99%

Defined-benefit Pension Plans: Are They as Good as They Seem?

Lightstone¹,

McFadden²,

Kocum³

2018

ujaf

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Defined-benefit pension plans were in a worse state than previously reported due to managements' ability to manage the assumptions, according to our study. This empirical paper examined whether managers would have used unreasonable discount rates and assumed rates of return for their pension obligation and assets in order to improve their financial position. We found companies were 4 times more likely to have used an unreasonable discount rate thereby reporting a better funding status than was warranted. We also found, companies were 34 times more likely to have used an unreasonable rate of return for calculating pension expense thereby increasing net income. This paper has implications for employees who have a defined-benefit pension plan; employers who want to be attractive to future employees; and governments that provide retirement supplements for their citizens.

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“…Genel bir finansal olayda ya da emeklilik tasarrufları ile ilişkili herhangi bir olayda birçok insanın riskin doğasını ve büyüklüğünü kavramsallaştırma konusunda zorluk çektiği görülmektedir (Gerrans ve Clark, 2013). Belirli katkı esaslı planlar, taşınabilir ve esnek oluşlarıyla katılımcılara cazip gelmekle birlikte, katılımcıların akıllıca seçimler yapma sorumluluklarını artırmıştır (Benartzi ve Thaler, 2007).…”

Section: Li̇teratürunclassified

Analysis of risk-taking behaviour of individual pension system participants the case of Turkey

Kara¹,

Yıldız²

2015

Pressacademia

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The study aims to analyze the risk-taking behavior of the individual pension system participants. In this context, the socio-economic factors that affect the risk taking behavior of the participants are investigated in accordance with the findings of the related literature by using the logistic regression methodology. According to the findings of the study, the duration of participation was found to be the most influential factor on the risk taking behavior of the individuals. Participants tend to invest in less risky assets as long as they stay in the system. Moreover, the participants who are male, married, do not experience a voluntary withdrawal, have a high level of education and who make higher contributions tend to direct their contributions to more risky assets. The age of the participants were not found as significant on the participant's risk taking behavior. Moreover, the sample is divided into two according to the status of the contract (withdraw/not withdraw) and the education level of the participants (high education/low education) and the analysis is repeated for the subsamples. According to the findings of the analysis, it is observed that the explanatory power of the models and the significance levels of the coefficients of the independent variables differentiate among the sub groups. BİREYSEL EMEKLİLİK SİSTEMİ KATILIMCILARININ RİSK ALMA DAVRANIŞLARININ DEĞERLENDİRİLMESİ: TÜRKİYE ÖRNEĞİ Anahtar KelimelerBireysel emeklilik, risk alma davranışı, Türkiye, lojistik regresyon, portföy tercihi JEL Sınıflandırması G11, G22, H55 ÖZETBu çalışmanın amacı bireysel emeklilik sisteminde yer alan katılımcıların emeklilik sistemindeki katkılarını değerlendirme aşamasında yaptıkları risk tercihlerinin incelenmesidir. Bu çerçevede katılımcıların risk alma isteklerini etkileyebilecek sosyo-ekonomik etkenler literatürde yer alan bulgular doğrultusunda lojistik regresyon yöntemi kullanarak tespit edilmeye çalışılmıştır. Yapılan analiz sonucunda katılımcıların risk alma isteklerini etkileyen en önemli faktörün, katılımcının sistemde geçirdiği süre olduğu tespit edilmiştir. Katılımcının sistemde kaldığı süre arttıkça katılımcılar daha az riskli varlıklara yönelmektedirler. Ayrıca, erkek, evli, bireysel emeklilik sistemden gönüllü olarak ayrılmayan, eğitim seviyesi ve katkı ödemesi yüksek olan katılımcıların birikimlerini daha fazla riskli yatırım araçlarına yönlendirdikleri görülmektedir. Katılımcılarının yaşlarının model için anlamlı olmadığı sonucuna ulaşılmıştır. Ayrıca, örneklem kontratın durumu (sistemden ayrılma/ayrılmama) ve katılımcının eğitim seviyesi (eğitim seviyesi yüksek/eğitim seviyesi düşük) dikkate alınarak alt gruplara ayrılmış ve analiz alt gruplar için tekrar edilmiştir. Bu analizler sonucunda modelin açıklayıcı gücünün ve değişkenlerin anlamlılık seviyelerinin alt gruplar için farklılık gösterdiği gözlenmiştir.

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Pension plan participant choice: Evidence on defined benefit and defined contribution preferences

Cited by 24 publications

References 55 publications

Determinants of seeking advice within defined contribution retirement savings schemes

Determinants of seeking advice within defined contribution retirement savings schemes

Defined-benefit Pension Plans: Are They as Good as They Seem?

Analysis of risk-taking behaviour of individual pension system participants the case of Turkey

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