Financial Literacy, Pension Awareness and Retirement Planning in Nigeria

Abstract

The study examined the effect of financial literacy and pension scheme awareness on retirement planning. We adopted survey research using where questionnaire was administered to 1350 respondents and employed multinomial logit model. Our findings revealed the significant positive effects of financial literacy and financial consultation on retirement planning decision. In contrast, family size decreases the probability of retirement planning respondents who mostly plan relative to those who rarely or never plan. Nevertheless, pension awareness did not have significant relationship with retirement. In conclusion, people who are financially literate are more likely to invest and are more inclined to plan for their retirement. Therefore, policies that can increase financial education and pension scheme literacy are worth implementing in the tertiary institutions.