Annuities, Financial Literacy and Information Overload

41 Pages Posted: 13 Nov 2010

See all articles by Julie R. Agnew

Julie R. Agnew

College of William and Mary - Mason School of Business

Lisa Szykman

affiliation not provided to SSRN

Date Written: November 11, 2010

Abstract

This chapter investigates how financial literacy and information overload influence the decision to purchase an annuity and how they relate to subsequent confidence and satisfaction. Using a dataset from a large-scale experiment, we find that as financial literacy increases, information overload decreases. In addition, people who experience higher levels of information overload are less confident in their choice and are less satisfied with their decision. We recommend that educators and retirement plan architects consider simplifying the decision environment in addition to improving financial literacy with the goal of increasing investor confidence and satisfaction.

Keywords: annuity, financial literacy, investment, education, retirement, market, annuitiy, annuitize

Suggested Citation

Richardson Agnew, Julie and Szykman, Lisa, Annuities, Financial Literacy and Information Overload (November 11, 2010). Pension Research Council WP 2010-33, Available at SSRN: https://ssrn.com/abstract=1707659 or http://dx.doi.org/10.2139/ssrn.1707659

Julie Richardson Agnew (Contact Author)

College of William and Mary - Mason School of Business ( email )

P.O. Box 8795
Williamsburg, VA 23187-8795
United States

Lisa Szykman

affiliation not provided to SSRN ( email )

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