A major set of decisions for men and women involves financial planning for retirement. For people aged 45-55 years, referred to as baby-boomers, seeking professional financial planning advice in the near future will facilitate a program of investment to secure an income stream in retirement. Personal financial planning, however, is a complex task requiring a degree of financial knowledge, risk management skills, and effort. As such, it provides an opportunity to conduct research into an aspect of consumer behaviour involving extended problem solving, set within the context of longer-term goals for a service that provides no immediate pleasure.
The thesis involved three studies that investigated the formation of intentions by baby-boomers to seek professional financial planning advice. In doing so, it integrated disparate fields of research in psychology and marketing. Guiding the research were the Theories of Reasoned Action and Planned Behaviour.
The first study, involving in-depth interviews, identified the quality of life goals of a sample of baby boomers. It found that retirement planning predominately centred on superannuation funding, with the assumption, among men and women, that this would provide the main source of retirement income.
The second study applied the Theory of Reasoned Action to investigate the formation of intentions by baby-boomers working at a major Australian university. Structural equation modelling determined by the Theory of Reasoned Action explained 55 percent of the variance in intentions to seek financial planning advice. Respondent satisfaction with work and life, and financial strain did not contribute to the prediction of intentions. The remaining antecedent variable, quality of life, was found to improve prediction to 66 percent.
The third study applied both the Theory of Reasoned Action and Planned Behaviour to a more diverse population of baby-boomers residing in southeast Queensland. The model that best explained variance in intention was the Theory of Reasoned Action, that incorporated indirect and direct measures of attitude and subjective norm.
Personal normative belief mediated the influence of these variables on intention. Overall, 80 percent of variation in intention was explained. In contrast, the Theory of Planned Behaviour failed to achieve a satisfactory fit to the data. It is interesting to reflect that respondents did not believe that financial resources or time detracted from their ability to exercise control over seeking professional financial planning advice. Quality of life was the only antecedent variable to achieve statistical significance, but it reduced the explanation of variance by 2 percent. The only variables found to have a moderating effect on intentions were marital status and income. People who were married were more likely to seek advice, as were people who were on an annual income at or below the sample median.
This research program validates the predictive power of the Theory of Reasoned Action in the new context of consumer decisions concerning financial planning. Planning for the future with no immediate benefit or gratification is an under researched area of consumer behaviour. In terms of developing intervention programs to encourage baby-boomers to seek financial planning advice, marketing practitioners should consider the relative influence of attitudinal and normative factors on the formation of intentions.
Finally, the research results provide a timely contribution to improving the understanding of consumer decisions about a service that will ultimately yield outcomes at a distant retirement date. It is evident from the research that the expectations concerning retirement income of many baby-boomers will not be met. This situation, however, is potentially recoverable if timely action is taken.