Retirement saving behavior: evidence from UAE

Abstract

Purpose This study aims to examine the effect of future time perspective (FTP), financial risk tolerance (FRT) and knowledge of financial planning for retirement (KFPR) on retirement saving behavior (RSB). Design/methodology/approach Primary data were collected using a non-probability judgmental sampling technique. A questionnaire was distributed either manually (by hand) or through email where 370 United Arab Emirates (UAE) residents used in the higher education sector participated. The data analysis was obtained by using SPSS and Smart-PLS software. Structural equation modeling was used to evaluate the linear relationship between FTP, FRT, KFPR and RSB. Findings The findings from this study are consistent with previous research. FTP and KFPR had a significant positive effect, while FRT had an insignificant negative effect on RSB. Research limitations/implications This study examined the effect of a few psychological variables on RSB and was conducted on a sample of university employees in the UAE. Additional research should examine environmental influences, individual differences and other psychological process factors. Furthermore, future research could extend the current study into other industries and other the Middle East and North Africa countries. Practical implications A better understanding of the factors that influence RSB can help working individuals, financial advisors/financial planning professionals, financial institutions and government/policymakers strengthen their understanding and initiatives toward retirement planning. Originality/value To the best of the authors knowledge, none of the previous research papers studied RSB in the UAE. Additionally, it is important to note that the results of this study can be generalized to all Gulf Cooperation Council countries because of the similar economic, political, ethical, social and cultural factors.