Financial Literacy, Pension Planning, and Investment Behavior - A Comparative Study between Austria and Switzerland

46 Pages Posted: 7 Sep 2016  

Tatjana Aubram

St. Pölten University of Applied Sciences

Monika Kovarova-Simecek

St. Pölten University of Applied Sciences, Department of Media & Economics

Gabrielle Wanzenried

Lucerne University of Applied Sciences and Arts, Institute of Financial Services Zug IFZ

Date Written: September 5, 2016

Abstract

This paper analyzes the impacts of financial literacy on the investment and pension planning behavior in Austria and Switzerland. Based on survey data of 449 individuals from Austria and Switzerland, we first analyze which socio-demographic and country-specific factors determine financial literacy. In a second step, we explain the investment and pension planning behavior by the level of financial literacy as well as other relevant person- and country-specific characteristics. In particular, we investigate differences between the Austrian and the Swiss with respect to financial literacy and the respective pension system and derive potential impacts on the pension planning and investment behavior of the population. Our results show a higher level of financial literacy in Switzerland compared to Austria, and the difference is even larger for the factual compared to the self-assessed financial literacy. Also women are less financially literate than men. A higher financial literacy has a clear positive impact on the level of pension planning, whereas the effect of the self-assessed financial literacy is stronger than the impact of the factual one. Swiss people seem to care more about pension planning compared to Austrians, and the same holds for elder people compared to the younger persons in our sample. Overall, our results provide some potentially interesting insights on the impacts of institutional differences on pension planning, investment and information behavior.

Keywords: Financial Literacy, Pension planning, Investment Behavior

JEL Classification: I22, J26, D14, P46, P52, C25

Suggested Citation

Aubram, Tatjana and Kovarova-Simecek, Monika and Wanzenried, Gabrielle, Financial Literacy, Pension Planning, and Investment Behavior - A Comparative Study between Austria and Switzerland (September 5, 2016). Available at SSRN: https://ssrn.com/abstract=2834869 or http://dx.doi.org/10.2139/ssrn.2834869

Tatjana Aubram

St. Pölten University of Applied Sciences ( email )

Matthias Corvinus-Straße 15
St. Pölten, 3100
Austria

Monika Kovarova-Simecek (Contact Author)

St. Pölten University of Applied Sciences, Department of Media & Economics ( email )

Matthias Corvinus-Straße 15
St. Pölten, 3100
Austria
+43 699 19015549 (Phone)

HOME PAGE: http://www.fhstp.ac.at

Gabrielle Wanzenried

Lucerne University of Applied Sciences and Arts, Institute of Financial Services Zug IFZ ( email )

IFZ Institute of Financial Services Zug
P.O. Box 4332
Zug, CH-6304
Switzerland
+4141757 67 37 (Phone)
+4141757 67 00 (Fax)

HOME PAGE: http://www.ifz.ch

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