| Abstract: |
We extend the literature on the importance of trust for financial behaviors by
examining trust, financial literacy, and financial behavior related to
retirement security. Using the Health and Retirement Study, we show that Trust
in Financial Institutions aligns with behaviors supportive of retirement
security, while Trust in Government Programs does not. We further document
racial/ethnic differences: for White respondents, Trust in Financial
Institutions relates positively to retirement outcomes, but not for Blacks or
Hispanics. Moreover, Trust in Government Programs among minority households is
linked to reduced stockholding and lower wealth accumulation. These findings
inform efforts to strengthen retirement security. |