Perception of Financial Well-Being of the Elderly and the Role of Propensity to Indebtedness and Financial Preparation for Retirement

Kelmara Mendes Vieira, Tamara Otilia Amaral Rosenblum, Taiane Keila Matheis, Leander Luiz Klein, Aureliano Angel Bressan


This study aimed to check the impact of financial preparation for retirement and the propensity to indebtedness on the perception of financial well-being in the elderly. A survey-type research was carried out with 885 individuals aged 60 years or older, living in Brazil, regardless of whether they are retired or not. Confirmatory factor analysis and structural equation modelling were used. The results indicated that the construct propensity to indebtedness has a negative impact on financial preparation for retirement and on the perception of financial well-being. The elderly are approaching retirement with a savings deficit and are heavily dependent on income from social security programs to support their families. Furthermore, the positive impact of financial preparation for retirement on the perceived financial well-being was found. Such findings highlight the importance of regulations that deal with the limit of credit supply and that prioritize the requirement of transparency of financial institutions in the disclosure to the less enlightened public. Therefore, it is essential to develop public policies to control indebtedness and incentives for financial preparation for retirement for the elderly in order to achieve better levels of Financial Well-being.

Keywords: perception of financial well-being, financial preparation for retirement, propensity to indebtedness, elderly, personal finance

DOI: 10.7176/RHSS/13-2-04

Publication date: January 31st 2023

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ISSN (Paper)2224-5766 ISSN (Online)2225-0484

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