Saving behaviour, expectations and financial hardship
In this paper, we firstly analyse the relationship between savings and expectations at the individual level. Specifically, we explore the relationship between saving on a regular monthly basis and expectations as measured by subjective job insecurity and being pessimistic about future finances. We also focus on the influence of the prevailing macroeconomic environment. We exploit UK panel data covering 1996 to 2014 drawn from the British Household Panel Survey and Understanding Society. Hence, our period of analysis covers the recent financial crisis. We then explore the effects of saving on a regular basis for future financial hardship in order to shed light on whether regular savings act as safety net for future financial difficulties. Our findings suggest that being pessimistic about future finances is positively associated with saving on a regular basis, which accords with precautionary saving motives. Our findings also indicate that saving on a regular basis is inversely associated with future financial hardship.
Date: 1 December 2016, 14:00 (Thursday, 8th week, Michaelmas 2016)
Venue: Seminar Room
Speaker: Professor Sarah Brown (University of Sheffiled)
Organiser: Mr Kenneth Howse (Oxford Institute of Population Ageing)
Organiser contact email address: administrator@ageing.ox.ac.uk
Part of: Financial Planning for Later Life in the UK
Booking required?: Not required
Audience: Public
Editor: Katia Padvalkava