The Factors Influencing Retirement Preparation Among Gen Y in Malaysia

Abstract

Preparing for retirement is one of the most important elements of a comfortable post- retirement life. The purpose of this study is to investigate the factors that influence the preparation towards retirement among Gen Y in Malaysia. In particular, this research investigated the relationship between demographic variables, attitude, subjective norms, perceived behavioral control, individual differences, and preparation towards retirement. This study used a convenience sampling method and involved Gen Y who are aged between 24 and 41 years old. Questionnaires were used as an instrument in this study. All the data was gathered from 384 respondents through an online survey. The questionnaire included the demographic profile of respondents and variable-related questions. This study uses the TPB as its main overarching theory, as well as life cycle hypothesis, symbolic interaction theory and prospect theory to frame its exploratory conceptual framework that explains the retirement preparation. The structural equation model predicts that attitudes, perceived behavioral control, and individual differences are positively correlated with preparation towards retirement among Gen Y, while demographic variables and subjective norms have no positive correlation. As a result of this study, Gen Y and other parties involved will realize that early preparation is crucial to sustaining after retirement. This research will benefit future researchers, government, insurance industries, and investment companies in gaining a better understanding of the factors that influence the preparation towards retirement. Finally, the article discusses the implications of the study to theory and practice; limitations, and recommendations for future research.

Pre-Retirement Planning of Expatriate Instructors: Application of Theory of Planned Behavior to the Case of the Sultanate of Oman

“…Hypothesis 1 (Subjective norms affect the retirement intention among university instructors in Oman) was not supported by the research findings. In this conclusion our results go in line with a study based on a sample of generation Y employees from Malaysia that didn't observe a positive correlation between subjective norms and preparation for retirement (Kumaraguru & Geetha, 2021). At the same time, multiple other studies have opposite results.…”

“…Similar results were observed by other studies. For example, the study of Malaysian generation Y employees showed a positive correlation between perceived behavioral control and preparation for retirement (Kumaraguru & Geetha, 2021). Another research that was also based on a sample localized in Malaysia named perceived behavioral control as the most significant predictor for retirement saving behavior.…”

Willingness to Accept Reverse Mortgage

“…Malaysians are not ready for retirement (Tai & Sapuan, 2018) because they lack retirement planning (Zulfaka & Kassim, 2021). Their lack of awareness to save for their retirement (Harun, 2020) causes their failure to sustain themselves throughout their retirement (Kumaraguru & Geetha, 2021).…”

Retirement Planning Awareness among Students in Uitm Negeri Sembilan

“…Retirement planning is the process of making plans to provide individuals with an income in retirement when they are no longer earning a consistent income from employment (Topa et al, 2011). Many retirees do not plan for retirement and do not have any retirement plans in place to help them maintain their current lifestyle during their retirement years (Kumaraguru & Geetha, 2021). Retirement planning is essential for maintaining one's current lifestyle after retirement to live a quality and long healthy life, which refers to regular care for people with a chronic illness or disability (Masran & Hassan, 2017).…”