Retirement planning decisions in Malta : a study of influencing factors

Abstract

The main objective of this study is to gain an understanding of what affects Maltese individuals’ behaviours when it comes to retirement planning. Given that longevity is on the increase, state pension income is limited (and most probably unsustainable over the long term) and that many individuals expect to be able to enjoy a comfortable retirement, it sets out to determine which macro- and micro-environmental factors are likely to encourage positive behaviour or otherwise. The study identifies a general sense of confusion in relation to financial concepts related to retirement. In line with other countries’ findings, the prevalence of myopia, procrastination and inertia has also been observed through the research undertaken. Through established behavioural finance theories and literature, as well as actual European practical examples, the research explores the best ways of “nudging” people into recognising the importance of taking action and making the right long-term financial decisions, to their own benefit and to that of society as a whole.