- Title
- The retirement funding adequacy of black South Africans
- Creator
- Zeka, Bomikazi
- Subject
- Retirement income -- South Africa -- Case studies South Africa -- Finance Finance, Personal
- Date Issued
- 2017
- Date
- 2017
- Type
- Thesis
- Type
- Doctoral
- Type
- PhD
- Identifier
- http://hdl.handle.net/10948/13338
- Identifier
- vital:27176
- Description
- Despite the importance of retirement planning, many South Africans have been documented as reaching retirement age without adequate retirement funding. A vast amount of research has been conducted on how proper retirement planning can be beneficial for individuals; however, there has been a lack of attention given to researching the retirement planning of black individuals in South Africa. Thus, the primary objective of this study was to identify, investigate and empirically test which factors influence retirement planning, and which aspects of retirement planning influence the retirement funding adequacy of black individuals. After a comprehensive literature review was undertaken on the factors influencing the retirement planning and retirement funding adequacy of individuals, the following independent variables were identified as influencing the mediating variable (Aspects of retirement planning) and the dependent variable (Retirement funding adequacy) in this study: • Financial literacy; • The role of the financial planner; • Family support structure; and • Health status. These independent variables were selected to construct a hypothesised model and research hypotheses, as they have been identified as the prominent factors that influence the retirement planning of black South Africans. Furthermore, these independent variables were used in determining whether they have an influence on the Aspects of retirement planning (incorporating Retirement provisions, Retirement attitudes and Retirement intentions) and, ultimately, improve the Retirement funding adequacy of individuals. In order to establish the influence of the aspects of retirement planning on the retirement funding adequacy of individuals, an empirical investigation was undertaken. A measuring instrument, in the form of a questionnaire, was compiled from secondary literature sources. The respondents were identified though a mixed sampling approach, whereby stratified sampling and convenience sampling were used to attain 441 usable questionnaires that were subjected to statistical analyses. Descriptive statistics, in the form of frequency distributions, were used to summarise Section A and Section B of the measuring instrument. The validity and reliability of the measuring instrument were confirmed by means of exploratory factor analyses (EFA), and Cronbach’s alpha coefficients were also calculated for this purpose. As a result of conducting the EFA, two independent variables (Family support structure and Health status) loaded together, and the factor was renamed accordingly. From the EFA, the independent variables that emerged were The role of the financial planner, Family, health, and financial well-being, and Financial literacy. Furthermore, the EFA revealed that three mediating variables emerged from the mediating variable Aspects of retirement planning. These three mediating variables were consequently named Retirement intentions, Retirement attitudes, and Retirement provisions. There were no eliminated variables in this study. Based on the results of the EFA, some of the definitions of the variables were adapted. Consequently, the hypothesised model and its research hypotheses were adapted to reflect the results of the EFA. The results of the Cronbach’s alphas calculated reported that all the measuring scales used in the questionnaire of the study were reliable. Furthermore, descriptive statistics were also calculated to summarise the sample data, and Pearson’s product moment correlations were calculated to establish the correlations between all the variables used in this study. A multiple regression analysis was used to investigate the influence of the various independent variables on the mediating variables and the dependent variable. Furthermore, structural equation modelling (SEM) was used as the main statistical procedure to test for mediation in the study. SEM was also used to assess and confirm the results of the multiple regression analyses. Based on the results of the multiple regression analyses and SEM, the hypothesised relationships of the study were accepted or rejected. Additionally, the results of SEM revealed that the revised model of the study displayed acceptable model fit. To conclude the empirical investigation, t-tests and an analysis of variance (ANOVA) tests were performed to assess whether the respondents’ perceptions of the variables used in the study differed as a result of the respondents’ demographic information. Furthermore, to establish significant differences between individual mean scores, post-hoc Tukey tests were calculated, and practical significance was assessed by calculating Cohen’s d values. The main empirical results of the study found that statistically significant relationships exist between the independent variables The role of the financial planner and Family, health, and financial well-being, and the mediating variable Retirement intentions. Furthermore, a significant relationship was found between the independent variable Financial literacy and the mediating variable Retirement attitudes. Other significant relationships were present between all the independent variables The role of the financial planner, Family, health, and financial well-being and Financial literacy, and the mediating variable Retirement provisions. The study also established statistically significant relationships between the mediating variables Retirement attitudes and Retirement provisions and the dependent variable Retirement funding adequacy. Statistically significant relationships were also present between the independent variables Family, health, and financial well-being and Financial literacy and the dependent variable Retirement funding adequacy. This study has added to the limited amount of academic literature in the field of retirement planning in South Africa. Through the hypothesised model developed in this study, a significant contribution has been made towards investigating the factors that influence the retirement planning and retirement funding adequacy of black individuals residing in South Africa. This study presents recommendations to black individuals on practical strategies that could help to improve their retirement planning and retirement funding adequacy. Furthermore, suggestions are presented to financial planners and financial institutions, in order to assist black individuals or potential clients to improve their retirement planning and to help ensure that individuals are financially independent when they reach retirement age. It is recommended that financial institutions provide financial products/services that will cater to black South Africans.
- Format
- xxvi, 428 leaves
- Format
- Publisher
- Nelson Mandela Metropolitan University
- Publisher
- Faculty of Business and Economic Sciences
- Language
- English
- Rights
- Nelson Mandela Metropolitan University
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