Description of Invention
The growth of ageing population with prolonged life expectancy, decreased morbidity and cost of inflation rate among many countries have triggered huge socioeconomic challenges. Malaysia is expected to be labelled as the ageing nation in 2030 and thus, retirement planning rests on the personal responsibility of many Malaysians. Retirement planning behaviour is not only affected by economic living standard; mental health is one of the predictor variables in financial preparedness. The research attempts to shed light on the intricacies in the relationships among familiarity bias, self-attribution bias and the mental health in retirement planning behaviour among Malaysians by revisiting the Prospect Theory and the Tripartite Theory of Anxiety and Depression. This study concluded that strong familiarity bias and poor mental health lead to high possibility of risk avoidance, i.e., loss aversion, mental accounting bias, and regret aversion while planning for retirement. Another contribution of this study is the self-attribution bias and retirement planning behaviours of Malaysians are significantly moderated negatively by mental health.