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The Influence of Financial Literacy, Risk Aversion and Expectations on Retirement Planning and Portfolio Allocation in Malaysia

Gadjah Mada International Journal of Business (GamaIJB) · Vol. 19 No. 3 (2017) · pp. 267–288

DOI
10.22146/gamaijb.24441
ISSN
2338-7238, 1411-1128
Published
2017-12-22
Publisher
Master in Management, Faculty of Economics and Business, Universitas Gadjah Mada
Language
eng
License
creativecommons.org/licenses/by-sa/4.0

Abstract

The two objectives of this paper are to examine the effect of financial literacy, risk aversion and expectations on retirement planning; and, to investigate the effect of these antecedents on the retirement portfolio allocation. Data was collected via a self-administered questionnaire from a sample of 270 working individuals in Kuala Lumpur, Malaysia. Logistic and ordered probit regressions were employed to analyse the first and second objective, respectively. The results from the logistic regression indicate that future expectations significantly influence the probability of planning for retirement. Meanwhile, individuals with higher financial literacy and lower risk aversion are more likely to hold risky assets in their retirement portfolios. Subsequently, two-sample t-test and one-way ANOVA tests were conducted to further examine the differences in financial literacy, risk aversion and expectations, across demographic subgroups. The study contributes to the literature by holistically incorporating the behavioural aspects that affect retirement planning and by exploring an uncharted issue of retirement planning—namely, the retirement portfolio allocation.

Keywords

Collaboration network of the authors

7 authors · 13 co-authorship links · 1 across different organisations

Hover or tap a name to highlight its co-authors. Double-click to open the author's page.

  • University of Malaya
  • National University of Singapore
  • Affiliation unknown
  • Different organisations
  • Same organisation
  • Affiliation unknown
  • Thicker line = more joint articles · bigger circle = more articles
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Co-authorOrganisationJoint articles
Mohd Edil Abd SukorUniversity of Malaya1
Rozaimah ZainudinUniversity of Malaya1
Fauzi ZainirUniversity of Malaya1
Wan Marhaini Wan AhmadUniversity of Malaya1

Affiliations come from OpenAlex; journal OAI-PMH metadata carries none. Authors without an OpenAlex ID are matched by name, which can merge or split people.

Metadata source: OAI-PMH (metadata jurnal) https://journal.ugm.ac.id/gamaijb/oai, first harvested 28 Okt 2026, last seen 28 Okt 2026.
Original metadata (oai_dc) 
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	<dc:title xml:lang="en-US">The Influence of Financial Literacy, Risk Aversion and Expectations on Retirement Planning and Portfolio Allocation in Malaysia</dc:title>
	<dc:creator>Mahdzan, Nurul Shahnaz</dc:creator>
	<dc:creator>Mohd-Any, Amrul Asraf</dc:creator>
	<dc:creator>Chan, Mun-Kit</dc:creator>
	<dc:subject xml:lang="en-US">Business, Management</dc:subject>
	<dc:subject xml:lang="en-US">Retirement planning, portfolio allocation, financial literacy, risk aversion, expectations</dc:subject>
	<dc:subject xml:lang="en-US">M1, M5, I3</dc:subject>
	<dc:description xml:lang="en-US">The two objectives of this paper are to examine the effect of financial literacy, risk aversion and expectations on retirement planning; and, to investigate the effect of these antecedents on the retirement portfolio allocation. Data was collected via a self-administered questionnaire from a sample of 270 working individuals in Kuala Lumpur, Malaysia. Logistic and ordered probit regressions were employed to analyse the first and second objective, respectively.  The results from the logistic regression indicate that future expectations significantly influence the probability of planning for retirement. Meanwhile, individuals with higher financial literacy and lower risk aversion are more likely to hold risky assets in their retirement portfolios. Subsequently, two-sample t-test and one-way ANOVA tests were conducted to further examine the differences in financial literacy, risk aversion and expectations, across demographic subgroups. The study contributes to the literature by holistically incorporating the behavioural aspects that affect retirement planning and by exploring an uncharted issue of retirement planning—namely, the retirement portfolio allocation.</dc:description>
	<dc:publisher xml:lang="en-US">Master in Management, Faculty of Economics and Business, Universitas Gadjah Mada</dc:publisher>
	<dc:contributor xml:lang="en-US">Ministry of Higher Education</dc:contributor>
	<dc:date>2017-12-22</dc:date>
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	<dc:identifier>https://journal.ugm.ac.id/gamaijb/article/view/24441</dc:identifier>
	<dc:identifier>10.22146/gamaijb.24441</dc:identifier>
	<dc:source xml:lang="en-US">Gadjah Mada International Journal of Business; Vol 19, No 3 (2017): September-December; 267-288</dc:source>
	<dc:source>2338-7238</dc:source>
	<dc:source>1411-1128</dc:source>
	<dc:language>eng</dc:language>
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	<dc:relation>https://journal.ugm.ac.id/gamaijb/article/downloadSuppFile/24441/2680</dc:relation>
	<dc:rights xml:lang="en-US">Copyright (c) 2017 Gadjah Mada International Journal of Business</dc:rights>
	<dc:rights xml:lang="en-US">http://creativecommons.org/licenses/by-sa/4.0</dc:rights>
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