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Voluntary Retirement Savings: The Case of Australia

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  • Jun Feng

    (Monash University)

Abstract

The shift to defined contribution plans has increased concerns about retirement adequacy for the working population. Different from prior research in countries where retirement savings are voluntary, this study explored the drivers of additional savings within the Australian superannuation system where mandatory savings are in place. Results suggested that age, economic and financial status, and job characteristics are important indicators for voluntary superannuation savings. Affordability, false beliefs, and lack of awareness about retirement savings inhibit participation. Past saving habits and retirement planning positively affect voluntary retirement savings. Joint modelling of pre- and post-tax savings decisions suggested a substitution effect between the two, adding new evidence to the literature.

Suggested Citation

  • Jun Feng, 2018. "Voluntary Retirement Savings: The Case of Australia," Journal of Family and Economic Issues, Springer, vol. 39(1), pages 2-18, March.
    • Handle: RePEc:kap:jfamec:v:39:y:2018:i:1:d:10.1007_s10834-017-9536-5
    DOI: 10.1007/s10834-017-9536-5
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    Cited by:

    1. Deanna L. Sharpe, 2021. "Reinventing Retirement," Journal of Family and Economic Issues, Springer, vol. 42(1), pages 11-19, July.
    2. Aaron Elkhishina & Tracey West & Kirsten MacDonald, 2019. "Understanding the retirement savings of self-employed tradespeople in Australia," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 22(2), pages 75-92.
    3. Alison Preston & Robert E. Wright, 2023. "Gender, Financial Literacy and Pension Savings," The Economic Record, The Economic Society of Australia, vol. 99(324), pages 58-83, March.
    4. Xiaobo Xu & Jiali Fang & Martin Young & Liping Zou, 2024. "The impact of post‐retirement financial market participation on retirement income sufficiency in Australia," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 64(1), pages 903-939, March.
    5. Cheung, Yan-Leung & Mak, Billy S.C. & Shu, Hao & Tan, Weiqiang, 2023. "Impact of financial investment on confidence in a happy future retirement," International Review of Financial Analysis, Elsevier, vol. 89(C).

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    More about this item

    Keywords

    Retirement saving behavior; Voluntary retirement savings; Saving plan participation; Mandatory retirement saving system; Personal finance; Consumer economics;
    All these keywords.

    JEL classification:

    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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