Socio-Demographic Factors Influencing Retirement Savings in Japan and the Impact of Digital Financial Inclusion

This paper attempts to model the socio-demographic factors of saving for old age in Japan and determine the impact of digital financial inclusion using demand-side financial inclusion survey data from the Global Findex Database. Weighted probit models were constructed to analyze the responses of over 1,000 Japanese adults and derive each factor’s average marginal effect. The results showed that age is a dominant factor in determining savings for old age, particularly those belonging in the 36-45 year old group who are 43% more likely to save for old age against the reference group. Respondents who use digital financial platforms have a 4% higher likelihood of saving for retirement than those who do not. On the other hand, when both saving for old age and, at the same time, transacting via digital means was modeled, older age groups appear less likely to engage in the said behavior. This may imply the limited reach of these digital platforms, or lower digital literacy among this demographic. In light of Japan’s rapidly aging population, strengthening financial and digital literacy among younger generations, while also expanding access and training for older adults, is essential to promote responsible saving behavior and ensure long-term financial resilience.