Financial Literacy and Retirement Planning in Germany

27 Pages Posted: 12 Jun 2011 Last revised: 3 Apr 2022

See all articles by Tabea Bucher-Koenen

Tabea Bucher-Koenen

Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA); ZEW – Leibniz Centre for European Economic Research

Annamaria Lusardi

Stanford University - Stanford Institute for Economic Policy Research

Multiple version iconThere are 3 versions of this paper

Date Written: June 2011

Abstract

We examine financial literacy in Germany using data from the SAVE survey. We find that knowledge of basic financial concepts is lacking among women, the less educated, and those living in East Germany. In particular, those with low education and low income in East Germany have little financial literacy compared to their West German counterparts. Interestingly, there is no gender disparity in financial knowledge in the East. In order to investigate the nexus of causality between financial literacy and retirement planning, we develop an IV strategy by making use of regional variation in the financial knowledge of peers. We find a positive impact of financial knowledge on retirement planning.

Suggested Citation

Bucher-Koenen, Tabea and Bucher-Koenen, Tabea and Lusardi, Annamaria, Financial Literacy and Retirement Planning in Germany (June 2011). NBER Working Paper No. w17110, Available at SSRN: https://ssrn.com/abstract=1861851

Tabea Bucher-Koenen (Contact Author)

Max Planck Society for the Advancement of the Sciences - Munich Center for the Economics of Aging (MEA) ( email )

Amalienstrasse 33
Munich, 80799
Germany

HOME PAGE: http://mea.mpisoc.mpg.de/

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

Annamaria Lusardi

Stanford University - Stanford Institute for Economic Policy Research ( email )

366 Galvez Street
John A. and Cynthia Fry Gunn Building
Stanford, CA CA 94305
United States

HOME PAGE: http://siepr.stanford.edu/people/annamaria-lusardi

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