University‐Provided Retirement Planning Support and Retiree Financial Satisfaction During Retirement: Differences by Gender, Job Classification, and Planning Behavior

Abstract

Sound financial planning and financial advice is necessary to achieve retirement income adequacy. The shift from defined benefit to defined contribution pension plans and the recent bankruptcy of Enron Corporation underscore the importance of managing retirement accumulation and liquidation risks. This study analyzes the effectiveness and adequacy of institutional-provided information and advice on employees' retirement planning decisions and their satisfaction with financial resources during retirement. Results suggest that retirement planning should begin earlier in an employee's career and that employer-provided retirement information and advice is a highly valued service. Gender, planning practices, job classification, and age are all significant predictors of satisfaction with financial resources during retirement. Targeting women and union employees with retirement information and advice that focuses on allocating contributions using a balanced portfolio approach should result in significant increases in satisfaction with financial resources during retirement. Regulatory objectives should focus on reducing retirement accumulation and liquidation risks, improving the delivery of professional financial advice to plan participants, and expanding qualified retirement plan choice for all labor force participants. To encourage employer participation in employee retirement planning, employers acting in "good faith" should be federally protected from liability for providing retirement planning information and advice to employees.

Managing money and retirement planning: Academics’ perspectives

“…31 Gender, planning practices, job classifi cation and age were signifi cant predictors of fi nancial satisfaction during retirement. Meanwhile, Giancola indicated that in general men were at a more advantageous position in retirement planning as compared to female counterparts, as they relatively earned more and in return saved more for retirement.…”

A Comparative Analysis of Financial Professionals’ Perception of the Level of Graduating Business Student Retirement Planning Familiarity, Motivation, and Preparedness

“…Poor financial behavior of many Americans may be attributed to ignorance or a lack of understanding how to make good financial decisions (Edmiston and Gillett-Fisher, 2006). This information asymmetry negatively impacts retirement plan participation, contribution levels, when retirement planning begins in an employee's career, and the value added from employer-provided retirement information and advice (Power and Hira, 2004).…”

Insurance Company Employees' Financial Expertise and Practices: Implications on Benefit Participation and Satisfaction

“…Research also documents a positive relationship between participation in financial literacy programs and retirement preparedness (Bernheim and Garrett, 2003). Power and Hira (2004) show that retirement planning should begin earlier in an employee's career and that employer‐provided retirement information and advice is a highly valued service. A Watson Wyatt Worldwide study concludes that companies with good benefit plans tend to serve their shareholders and employees better and that an important element of a good plan is good education and advice (Watson Wyatt Worldwide, 2005).…”