Abstract
AbstractThis paper studies the relationship between financial literacy and retirement planning in Chile, a country with mandatory defined contribution pension plans at the core of its retirement policy. Using a novel dataset, we find that very few Chileans are planning for their retirement and that the levels of financial literacy are remarkably low with only 47% of the population understand compound interest and only 18% understand the concept of inflation. We also find a positive and significant relationship between financial literacy and retirement planning suggesting that investments in financial education could have a substantial impact on the way people think about retirement and therefore on their ability to reach retirement with adequate resources.
Publisher
Cambridge University Press (CUP)
Subject
Organizational Behavior and Human Resource Management,Economics and Econometrics,Finance,Organizational Behavior and Human Resource Management,Economics and Econometrics,Finance
Reference26 articles.
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