Therefore, we would like to take this opportunity to thank those who have directly or indirectly helped us to complete this study. Furthermore, the general objective of this study is to identify the relationship between determinants including income, financial knowledge, savings behavior and goal clarity in relation to retirement planning due to the effect of the Covid-19 pandemic.
RESEARCH OVERVIEW
- Introduction
- Research Background
- Problem Statement
- Research Objective
- General Objective
- Specific Objective
- Research Question
- Significant of the study
- Conclusion
To determine the relationship between income and retirement planning due to the effect of the Covid-19 pandemic. To determine the relationship between financial literacy and retirement planning due to the effect of the Covid-19 pandemic.
LITERATURE REVIEW
Introduction
Theoretical Review
- Continuity Theory
- Theory of Planned Behaviour (TPB)
- Life Cycle Theory
- Beach Image Theory
Therefore, this theory is used in conducting our study to investigate the influence of income in different life stages to influence the retirement planning due to the effect of Covid-19 pandemic. Therefore, this model is adopted in our research in the investigation of the relationship between goal clarity and retirement planning due to the effect of the Covid-19 pandemic.
Variables Review
- Dependent Variable (DV) – Retirement Planning
- Independent Variables (IV)
- Income
- Financial Literacy
- Savings Behaviour
- Goal Clarity
There are many studies that concluded that the relationship between financial literacy and retirement planning is positively correlated. Based on findings, the findings revealed that financial literacy is important in measuring retirement planning.
Conceptual Framework
To conclude, the previous research is inconsistent in terms of target population, different sample size, age group as well as study location. Additionally, there are limited studies that have been conducted in terms of the effect of the Covid-19 pandemic in retirement planning. Consequently, it brings our intention to further study on goal clarity in the influence of retirement planning due to the effect of Covid-19 pandemic.
Hypothesis Development
- Income and Retirement Planning
- Financial Literacy and Retirement Planning
- Savings Behaviour and Retirement Planning
- Goal Clarity and Retirement Planning
H0: There is no significant relationship between savings behavior and retirement planning due to the effect of the Covid-19 pandemic. H1: There is a significant relationship between savings behavior and retirement planning due to the effect of the Covid-19 pandemic. This is similar to the results of other studies that have found a positively correlated relationship between savings behavior and retirement planning.
There is no significant relationship between goal clarity and retirement planning due to the effect of the Covid-19 pandemic. There is a significant relationship between goal clarity and retirement planning due to the effect of the Covid-19 pandemic. A major contribution made by Stawski et al. 2007) which examines the relationship of individual's goals with regard to retirement planning by starting the 5 likert scale items.
The result showed that goal clarity is positively related to retirement planning, which is consistent with most of the recent studies (Moorthy et al., 2012; Kadir et al., 2020; Afthaorhan, 2020; Rasiah et al., 2020).
Conclusion
Goal clarity refers to an individual's ability to establish a clear and precise goal that is achievable and strive to achieve it.
METHODOLOGY
- Introduction
- Research Design
- Data collection method
- Design of Sampling
- Target Population
- Sampling Frame and Location
- Elements of Sampling
- Sampling Techniques
- Size of Sampling
- Research Instrument
- Questionnaire Design
- Pilot Test
- Constructs Measurement
- Nominal Scale
- Interval Scale
- Data processing
- Data collection
- Data Editing
- Data Coding
- Data Tabulation
- Interpretation of results
- Data analysis
- Descriptive analysis
- Scale Measurements
- Inferential Analysis
- Conclusion
Determinants of retirement planning for private employed persons due to the effect of the Covid-19 pandemic can be explained using descriptive research as well as how significant the relationship between variables can be described. Therefore, to identify the determinants of retirement planning for private employed persons due to the effect of the Covid-19 pandemic, primary data are being adopted. The data collection based on the 30-group questionnaire will be entered into SPSS software for processing to test reliability.
The objective of performing data editing is to ensure that the data collected meets the fundamental standard. Consequently, the data must be examined or checked after the data from survey questionnaire is collected to ensure that the data is corrected. The process aimed to separate the data collected into categories and then assign a code or number to each data based on the categories.
According to Woodrow (2014), data collected from respondents were described based on descriptive analysis for research for better understanding with the data at a glance.
DATA ANALYSIS
- Introduction
- Descriptive Analysis
- Respondent Demographic Profile
- Central Tendencies Measurement of Constructs
- Scale Measurement
- Reliability Test (Cronbach’s Alpha)
- Inferential Analysis
- Pearson’s Correlation
- Multiple Linear Regression & ANOVA
- Conclusion
See Table 4.2, the item “I can better plan for retirement with a stable income” contributes the highest M value with a value of 4.00 obtained from all respondents. The score listed in Table 4.4, 4.09, recorded for the item “I know that it is always important to deal with emergencies such as the Covid-19 outbreak”, represents the highest rank. According to the result in Table 4.5, the item “I set specific goals for how much I will need to save for my retirement”.
Table 4.6 shown above works to show that M and SD of DV and IV. Exhibit Table 4.7 works to demonstrate the Cronbach's α score for DV (retirement planning) and IV (income, financial literacy, savings behavior, and goal clarity). Refer to Table 4.8 works to show that there is correlation between DV (retirement planning) and IV (income, financial knowledge, savings behavior, clarity of purpose).
Shown by Table 4.9, the researchers identified all IVs (income, financial literacy, saving behavior and goal clarity) as significant in contributing to DV (retirement planning) at the 0.05 significance level.
DISCUSSION, CONCLUSION AND IMPLICATIONS
Introduction
Summary of Statistical Analysis
- Summary of Result
These age groups are classified as the highest and middle age group who are starting to save and amortize for their retirement planning. Standard deviation with the highest value being 1.26030 under retirement planning, while the lowest value is 1.04476 under target clarity. See Table 5.3, independent variables consist of income, financial literacy, saving behavior and clarity of goals. Records "Excellent" for the confidence level with the Cronbach's α value above the range of 0.90.
In contrast, the confidence level for retirement planning is acceptable, as the Cronbach's α value is between 0.70 and 0.80. See table 5.4. In terms of Pearson correlation, all independent variables of income, financial literacy, saving behavior and clarity of goals are significantly correlated with retirement planning. See table 5.5: all independent variables income, financial literacy, saving behavior and clarity of goals have a significant relationship with retirement planning, as they have been found to meet the 95% confidence level.
The R-square records 0.549 explains that the independent variables of this study accounted for 54.90% of variation in retirement planning.
Discussion on Major Findings
- Income
- Financial Literacy
- Savings Behaviour
- Goal Clarity
Due to the impact of the Covid-19 pandemic, this study found a positive significant relationship between income and retirement planning. H2: Financial literacy has a significant relationship with retirement planning due to the impact of the Covid-19 pandemic. Therefore, it is assumed that the importance of financial literacy affects good retirement planning due to the impact of the pandemic.
H3: Saving behavior has a significant relationship with retirement planning due to the effect of Covid-19 pandemic. In conclusion, individuals who adopt saving behavior considering the effect of Covid-19 can plan well for retirement (RinggitPlus, 2021). H4: Goal clarity has a significant relationship with retirement planning due to the effect of Covid-19 pandemic.
Clarity of purpose appears to have a significant relationship with retirement planning due to the effect of the Covid-19 pandemic.
Managerial Implication
- Income
- Financial Literacy
- Savings Behaviour
- Goal Clarity
Therefore, creating a practical and achievable retirement goal is crucial and has significant impact on better retirement planning. Therefore, it is essential to address these gaps to promote sound retirement planning among the public. As such, initiatives including the National Strategy for Financial Education 2019-2023 by the Financial Education Network (FEN) as well as the program by the Malaysian Financial Planning Council (MFPC) are good guidelines to promote financial literacy and increase long-term retirement planning.
Savings behavior is a practice influenced by one's personal values, which must be nurtured among employees for better pension planning. For the general public, they are able to seek professional help in getting involved in retirement planning activities. At the same time, retirement planning is a long-term process; they may uncertainty, including economic shock, such as the current pandemic time would disrupt retirement planning (Hershey et al., 2007).
Therefore, the public should be aware of the critical importance of extending the time frame in the wealth accumulation process by starting retirement planning earlier; thus reducing the periodic cash flow needed, as well as the ability to cope with uncertainty, to achieve their retirement goals.
Limitations
The practical implications according to the findings of this research indicate that interventions by the authorities as well as public awareness in setting desired retirement goals are significant. For financial planners, it is crucial to consistently spread awareness and advise the wider population about the importance of setting clear and specific retirement goals. They should therefore help design personalized retirement plans tailored to their clients' goals (Jiménez et al., 2019).
Given the impact of Covid-19, it is recommended that the temporary market corrections can be considered by the public to plan with their personal financial advisor the alternatives to address the negative impact and disruption to their specific retirement goals. The information obtained from this study is limited, even though all variables have been tested to have a significant impact on retirement planning, but the general concept can only be taken into account when the scope is comprehensive. To study the impact of the Covid-19 pandemic on retirement planning, a cross-sectional study was conducted in this study.
Which, there is potential for variables to change over time, and the findings only capture a snapshot of retirement planning during this particular pandemic.
Recommendations
Retirement planning is a long-term issue that requires occasional observation to ensure improvements in the consequences. Therefore, future researchers are suggested to conduct long-term studies to track changes in variables that may lead to better retirement planning, especially during post-pandemic. Researchers required to change the implications that increase the long-term effect in the construction of the pension profile.
Conclusion
Retrieved from https://www.thesundaily.my/local/covid-19-highlights- important-of-financial-literacy-mohd-shahar-MJ4812907. Retrieved from https://www.dosm.gov.my/v1/index.php?r=column/ctheme ByCat&cat=118&bul_id=Y3kwU2tSNVFDOWp1YmtZYnhUeVBEDz09&menu_id=L0 pheU43NWJUz0Q9kl. Retrieved from https://www.dosm.gov.my/v1/index.php?r=column/cthemeBy Cat&cat=116&bul_id=R0VPdE1mNEdRQms2S0M4M1ZsSlVEdz09&menu_id=L0phe U43NWJwRWVSZl.
Retrieved from https://www.dosm.gov.my/v1/index.php?r=column/cthemeBy Cat&cat=157&bul_id=VDRDc0pGZHpieEUwMDNFWHVHSnpkdz09&menu_id=Tm8 zcnRjdVRNWWlpWjRlbmtlaDk1UT09. Retrieved from https://www.dosm.gov.my/v1/index.php?r=column/cone&menu_id=bVNhYUZZbmd3V DMrcGNxUlNKSWNwUT09. Financial literacy education and retirement planning of the urban elderly in Malaysia (Doctoral dissertation, University of Malaya, Kuala Lumpur, Malaysia).
This research aims to identify the effects of the Covid-19 pandemic on retirement planning: evidence from private employees. Have you visited any websites, articles or brochures regarding retirement planning during the Covid-19 pandemic. Have you visited any websites, articles or brochures related to retirement planning during the Covid-19 pandemic.
