IDEAS home Printed from https://ideas.repec.org/a/ozl/journl/v10y2007i2p115-127.html
   My bibliography  Save this article

Decision Making Clusters in Retirement Savings: Preliminary Findings

Author

Listed:
  • Marilyn Clark-Murphy

    (Edith Cowan University)

  • Craig P. Speelman

    (Edith Cowan University)

Abstract

The aim of the present study was to explore whether identifiable member clusters exist in retirement savings decisions by considering the investment choice history of the members of four large Australian retirement savings funds. We used a two-step cluster analysis to examine whether well-defined sub-groups exist as identified by their investment choices and member demographics. Funds were tested individually and collectively using a range of variables. Distinct groups were found, varying along gender and age lines. There were also clear distinctions between the groups in terms of the risk of the investments they chose. Future work is discussed, including the refinement of variables selected.

Suggested Citation

  • Marilyn Clark-Murphy & Craig P. Speelman, 2007. "Decision Making Clusters in Retirement Savings: Preliminary Findings," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 10(2), pages 115-127.
    • Handle: RePEc:ozl:journl:v:10:y:2007:i:2:p:115-127
    as

    Download full text from publisher

    File URL: http://ftprepec.drivehq.com/ozl/journl/downloads/AJLE102speelman.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bajtelsmit, Vickie L. & Bernasek, Alexandra & Jianakoplos, Nancy A., 1999. "Gender differences in defined contribution pension decisions," Financial Services Review, Elsevier, vol. 8(1), pages 1-10.
    2. Marilyn Clark-Murphy & Paul Gerrans, 2001. "Choices And Retirement Savings: Some Preliminary Results On Superannuation Fund Member Decisions," Economic Papers, The Economic Society of Australia, vol. 20(3), pages 29-42, September.
    3. Marilyn Clark-Murphy & Paul Gerrans, 2004. "Apparently Contradictory Superannuation Choices Among Younger Fund Members: A Misunderstanding Of Risk?," Economic Papers, The Economic Society of Australia, vol. 23(2), pages 101-113, June.
    4. Papke, Leslie E., 2004. "Individual financial decisions in retirement saving plans: the role of participant-direction," Journal of Public Economics, Elsevier, vol. 88(1-2), pages 39-61, January.
    5. Julie Agnew & Pierluigi Balduzzi & Annika Sundén, 2003. "Portfolio Choice and Trading in a Large 401(k) Plan," American Economic Review, American Economic Association, vol. 93(1), pages 193-215, March.
    6. Gerrans, Paul & Clark-Murphy, Marilyn, 2004. "Gender differences in retirement savings decisions," Journal of Pension Economics and Finance, Cambridge University Press, vol. 3(2), pages 145-164, July.
    7. Venti, Steven F & Wise, David A, 1998. "The Cause of Wealth Dispersion at Retirement: Choice or Chance?," American Economic Review, American Economic Association, vol. 88(2), pages 185-191, May.
    8. Bateman,Hazel & Kingston,Geoffrey & Piggott,John, 2001. "Forced Saving," Cambridge Books, Cambridge University Press, number 9780521481625.
      • Bateman,Hazel & Kingston,Geoffrey & Piggott,John, 2001. "Forced Saving," Cambridge Books, Cambridge University Press, number 9780521484718.
    9. Ross S. Guest & Ian M. McDonald, 2000. "Population Ageing and Projections of Government Social Outlays in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 33(1), pages 49-64, March.
    10. Dwyer, Peggy D. & Gilkeson, James H. & List, John A., 2002. "Gender differences in revealed risk taking: evidence from mutual fund investors," Economics Letters, Elsevier, vol. 76(2), pages 151-158, July.
    11. Tim Fry & Richard Heaney & Warren McKeown, 2007. "Will investors change their superannuation fund given the choice?," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 47(2), pages 267-283, June.
    12. VanDerhei, Jack L. & Olsen, Kelly A., 2000. "Social Security investment accounts: lessons from participant-directed 401(k) data," Financial Services Review, Elsevier, vol. 9(1), pages 65-78, 00.
    13. Gur Huberman & Wei Jiang, 2006. "Offering versus Choice in 401(k) Plans: Equity Exposure and Number of Funds," Journal of Finance, American Finance Association, vol. 61(2), pages 763-801, April.
    14. Engström, Stefan & Westerberg, Anna, 2003. "Which individuals make active investment decisions in the new Swedish pension system?," SSE/EFI Working Paper Series in Economics and Finance 527, Stockholm School of Economics, revised 12 Aug 2003.
    15. Therese Jefferson, 2005. "Women and Retirement Incomes in Australia: A Review," The Economic Record, The Economic Society of Australia, vol. 81(254), pages 273-291, September.
    16. Clark-Murphy, Marilyn & Gerrans, Paul, 2001. "Consultation and resource usage in retirement savings decisions: Australian evidence of systematic gender differences," Financial Services Review, Elsevier, vol. 10(1-4), pages 273-290.
    17. Ross Clare, 2006. "The Introduction of Choice of Superannuation Fund: Results to Date," Australian Accounting Review, CPA Australia, vol. 16(40), pages 7-13, November.
    18. Alexandra Bernasek & Stephanie Shwiff, 2001. "Gender, Risk, and Retirement," Journal of Economic Issues, Taylor & Francis Journals, vol. 35(2), pages 345-356, June.
    19. Therese Jefferson & Alison Preston, 2005. "Australia'S "Other" Gender Wage Gap: Baby Boomers And Compulsory Superannuation Accounts," Feminist Economics, Taylor & Francis Journals, vol. 11(2), pages 79-101.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Craig Speelman & Marilyn Clark-Murphy & Paul Gerrans, 2013. "Decision Making Clusters in Retirement Savings: Gender Differences Dominate," Journal of Family and Economic Issues, Springer, vol. 34(3), pages 329-339, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Marilyn Clark-Murphy & Paul Gerrans & Craig Speelman, 2009. "Return Chasing as a Driver in Individual Retirement Savings Investment Choices: Evidence from Australia," Journal of Family and Economic Issues, Springer, vol. 30(1), pages 4-19, March.
    2. Craig Speelman & Marilyn Clark-Murphy & Paul Gerrans, 2013. "Decision Making Clusters in Retirement Savings: Gender Differences Dominate," Journal of Family and Economic Issues, Springer, vol. 34(3), pages 329-339, September.
    3. Paul Gerrans & Marilyn Clark‐Murphy & Craig Speelman, 2010. "Asset allocation and age effects in retirement savings choices," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 50(2), pages 301-319, June.
    4. Anup K. Basu & Michael E. Drew, 2009. "The Case for Gender‐Sensitive Superannuation Plan Design," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 42(2), pages 177-189, June.
    5. Sara Fernández-López & Milagros Vivel-Búa & Luis Otero-González & Pablo Durán-Santomil, 2015. "Exploring The Gender Effect On Europeans' Retirement Savings," Feminist Economics, Taylor & Francis Journals, vol. 21(4), pages 118-150, October.
    6. Gerrans, Paul & Moulang, Carly & Feng, Jun & Strydom, Maria, 2018. "Individual and peer effects in retirement savings investment choices," Pacific-Basin Finance Journal, Elsevier, vol. 47(C), pages 150-165.
    7. Therese Jefferson, 2007. "Discussing Retirement: Insights from a Qualitative Research Project," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 10(2), pages 129-145.
    8. Hibbert, Ann Marie & Lawrence, Edward R. & Prakash, Arun J., 2013. "Does knowledge of finance mitigate the gender difference in financial risk-aversion?," Global Finance Journal, Elsevier, vol. 24(2), pages 140-152.
    9. Mitchell, O.S. & Piggott, J., 2016. "Workplace-Linked Pensions for an Aging Demographic," Handbook of the Economics of Population Aging, in: Piggott, John & Woodland, Alan (ed.), Handbook of the Economics of Population Aging, edition 1, volume 1, chapter 0, pages 865-904, Elsevier.
    10. Tansel Yilmazer & Angela Lyons, 2010. "Marriage and the Allocation of Assets in Women’s Defined Contribution Plans," Journal of Family and Economic Issues, Springer, vol. 31(2), pages 121-137, June.
    11. Gürdal, Mehmet Y. & Kuzubaş, Tolga U. & Saltoğlu, Burak, 2017. "Measures of individual risk attitudes and portfolio choice: Evidence from pension participants," Journal of Economic Psychology, Elsevier, vol. 62(C), pages 186-203.
    12. Andrew Worthington, 2008. "Knowledge and Perceptions of Superannuation in Australia," Journal of Consumer Policy, Springer, vol. 31(3), pages 349-368, September.
    13. Geoffrey Kingston & Susan Thorp, 2019. "Superannuation in Australia: A Survey of the Literature," The Economic Record, The Economic Society of Australia, vol. 95(308), pages 141-160, March.
    14. Peter J. Phillips, 2011. "Will Self‐Managed Superannuation Fund Investors Survive?," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 44(1), pages 51-63, March.
    15. Angela Lyons & Urvi Neelakantan & Erik Scherpf, 2008. "Gender and Marital Differences in Wealth and Investment Decisions: Implications for Researchers, Financial Professionals, and Educators," NFI Working Papers 2008-WP-02, Indiana State University, Scott College of Business, Networks Financial Institute.
    16. Belaounia, Samia & Tao, Ran & Zhao, Hong, 2020. "Gender equality's impact on female directors’ efficacy: A multi-country study," International Business Review, Elsevier, vol. 29(5).
    17. Gerrans, Paul & Yap, Ghialy, 2014. "Retirement savings investment choices: Sophisticated or naive?," Pacific-Basin Finance Journal, Elsevier, vol. 30(C), pages 233-250.
    18. Bellofatto, Anthony & Broihanne, Marie-Hélène & D'Hondt, Catherine, 2019. "Appetite for information and trading behavior," LIDAM Discussion Papers LFIN 2019002, Université catholique de Louvain, Louvain Finance (LFIN).
    19. Gregor Dorfleitner & Lars Hornuf & Martina Weber, 2018. "Paralyzed by Shock: The Portfolio Formation Behavior of Peer-to-Business Lending Investors," CESifo Working Paper Series 7092, CESifo.
    20. Joanne K Earl & Paul Gerrans & Anthony Asher & Julia Woodside, 2015. "Financial literacy, financial judgement, and retirement self-efficacy of older trustees of self-managed superannuation funds," Australian Journal of Management, Australian School of Business, vol. 40(3), pages 435-458, August.

    More about this item

    Keywords

    Retirement; Retirement Policies; Investment Decisions; Personal finance;
    All these keywords.

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ozl:journl:v:10:y:2007:i:2:p:115-127. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sandie Rawnsley (email available below). General contact details of provider: https://edirc.repec.org/data/becurau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.