The Determinants and Consequences of Financial Education in the Workplace: Evidence from a Survey of Households

Bernheim, B. Douglas; Garrett, Daniel M.

doi:10.3386/w5667

Cited by 76 publications

(47 citation statements)

References 3 publications

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“…Lusardi (1999) further confirmed that households who spend time planning for retirement show a significant increase in their savings as compared to those who did not plan for retirement. Financial planning activities could include information seeking activities, for instance, meeting with a financial investment or retirement counsellor (Grable & Joo, 2001;Richardson, 1990), attending a financial seminar (Lusardi, 2003), or participating in a workplace retirement preparation program (Bernheim & Garrett, 1996;Madrian & Shea, 2001) which in turn stimulates saving practices (Gustman & Steinmeier, 2000).…”

Section: Retirement Planningmentioning

confidence: 99%

Retirement Planning & Job Satisfaction: Cushion to Avoid Bridge Employment?

Osman

Adis²,

Razli³

et al. 2015

ASS

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Retirement forces older workers to disconnect with their previous behavioural patterns and economic position. Transition and adjustment from working life to retirement places great psychological pressure and financial distress on older workers, especially those with dependent children. Bridge employment provides a solution for older workers to continue working after retirement while transitioning into retirement slowly and smoothly. As losing the job role has a significant impact on the psychological well-being of retirees, engaging in bridge employment helps to fulfil the important psychological functions of older workers by providing an adaptive style to retirement. This study investigates the influence of retirement planning and job satisfaction on bridge employment. A self-administered questionnaire was used in this study and a total of 523 samples were collected for nine major districts in Sabah. Data were analysed using Partial Least Square (PLS) method version 2.0. The result showed a significant relationship between retirement planning and job satisfaction on bridge employment, explaining 4.7% the variance in bridge employment and job satisfaction was found to be the strongest predictor of bridge employment.

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Section: Retirement Planningmentioning

confidence: 99%

Retirement Planning & Job Satisfaction: Cushion to Avoid Bridge Employment?

Osman

Adis²,

Razli³

et al. 2015

ASS

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“…Bernheim and Garrett (1996) and Bayer, Bernheim, and Scholz (1998) find that financial education in the workplace increases participation in retirement plans.…”

mentioning

confidence: 99%

Social Interaction and Stock‐Market Participation

Hong¹,

Kubik²,

Stein³

2004

The Journal of Finance

1,432

176

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We propose that stock-market participation is inf luenced by social interaction. In our model, any given "social" investor finds the market more attractive when more of his peers participate. We test this theory using data from the Health and Retirement Study, and find that social households-those who interact with their neighbors, or attend church-are substantially more likely to invest in the market than non-social households, controlling for wealth, race, education, and risk tolerance. Moreover, consistent with a peer-effects story, the impact of sociability is stronger in states where stock-market participation rates are higher.The Journal of Finance in the stock market. On the one hand, if one takes the perspective of a fullinformation, frictionless model with optimizing households-in which those who sit out do so simply because they find the market's risk-return profile unattractive-standard arguments suggest that there is nothing to be gained by having the government invest in the market on their behalf. On the other hand, if households do not participate because of a lack of information about market opportunities, or because other frictional costs deter them from doing so, the case for these proposals can, at a minimum, begin to make logical sense. 2 A few basic facts about the determinants of household participation in the stock market are already well known. 3 First, participation is strongly increasing in wealth. This can be understood by thinking of participation as involving fixed costs; wealthier households have more to invest, and so the fixed cost is less of a deterrent to them. Vissing-Jorgensen (2000) builds a model in which fixed costs of participation are incurred on a per-period basis, and estimates that such costs have to be on the order of $200 per year to explain observed participation rates. Of course, such large numbers beg the questions of what these black-box fixed costs actually represent, and whether one should think of them as being similar across different types of households.Stock-market participation has also been found to be increasing in household education. One interpretation is that education reduces the fixed costs of participating, by making it easier for would-be investors to understand the market's risk-reward trade-offs, to deal with the mechanics of setting up an account, and executing trades, etc. 4 Finally, there is also a pronounced link between race and participation, with white, non-Hispanic households having much higher participation rates, controlling for wealth and education.In this paper, we add to this line of work by considering the possibility that stock-market participation is inf luenced by social interaction. A priori, this would seem to be a promising hypothesis, given the growing body of empirical research that speaks to the importance of peer-group effects in a variety of other contexts. 5 Notably, some of this work finds evidence of peer effects in financial settings that are suggestively close to the one we have in mindfor example, Madrian and Shea...

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“…An alternative perspective with which to view the relationships between the variables of interest is that financial literacy and expectations for the future financial situation mediate the relationship between participation in the educational session and outcomes such as workplace satisfaction. To date, most of the research on workplace financial education has focused on its direct effects on financial behavior (Fletcher, Beebout, and Mendenhall 1997; Kim 2000), work outcomes (Joo 1998; Kim 2000), and personal saving (Bernheim and Garrett 2000, 2003). Little light has been shed on intermediate steps, such as the increase in financial literacy.…”

Section: Hypothesesmentioning

confidence: 99%

Understanding the impact of employer‐provided financial education on workplace satisfaction

Hira

Loibl

2005

Journal of Consumer Affairs

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The present study examines the linkage between workplace financial education and workplace satisfaction. Data gathered from a national sample of employees of an insurance company favor the hypothesis that employees who participate in workplace financial education more fully understand personal finances and recognize how financial literacy impacts their future financial expectations. In addition, employees who gain considerable literacy in financial matters and confidence in their future financial situation are also more likely to be satisfied with and supportive of their company. Implications of these results for nonwork settings and for consumers in general have also been developed.

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The Determinants and Consequences of Financial Education in the Workplace: Evidence from a Survey of Households

Cited by 76 publications

References 3 publications

Retirement Planning & Job Satisfaction: Cushion to Avoid Bridge Employment?

Retirement Planning & Job Satisfaction: Cushion to Avoid Bridge Employment?

Social Interaction and Stock‐Market Participation

Understanding the impact of employer‐provided financial education on workplace satisfaction

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