Risk Preference, Asset Allocation, and Seniors’ Satisfaction

Posted: 28 Sep 2018

See all articles by Ruizhi Chen

Ruizhi Chen

Texas Tech University, College of Human Sciences, Department of Personal Financial Planning

Michael Guillemette

Texas Tech University - Department of Personal Financial Planning

Chris Browning

Texas Tech University

Date Written: September 28, 2018

Abstract

Maintaining clients’ financial satisfaction is a primary goal of financial planners. Previous research has found that net worth, income, and demographic characteristics are relevant to an individuals’ financial satisfaction. However, no existing research identifies whether the alignment between risk preferences and portfolio-risk level affects financial satisfaction. This research will investigate whether or not an individual feels more satisfied if his or her equity allocation aligns with his or her risk preferences. The finding of this study could potentially help financial planners better understand their clients, maintain good relationship with clients, improve overall client well-being, and provide advice that best fits clients’ needs.

Keywords: satisfaction, financial satisfaction, risk aversion, risk preference, risk tolerance, asset allocation, equity level, misalignment

Suggested Citation

Chen, Ruizhi and Guillemette, Michael and Browning, Chris, Risk Preference, Asset Allocation, and Seniors’ Satisfaction (September 28, 2018). Available at SSRN: https://ssrn.com/abstract=3256973

Ruizhi Chen (Contact Author)

Texas Tech University, College of Human Sciences, Department of Personal Financial Planning ( email )

1301 Akron Ave, HS-260
Lubbock, TX
United States
575-265-8371 (Phone)

Michael Guillemette

Texas Tech University - Department of Personal Financial Planning ( email )

1301 Akron Ave, HS-260
Box 41210
Lubbock, TX 79409-1210
United States

Chris Browning

Texas Tech University ( email )

2500 Broadway
Lubbock, TX 79409
United States

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