Research On The Influence Of Financial Literacy Of Chinese Urban Residents On Pension Decision-making And Pension Asset Allocation

China consumer financial literacy report(2019)shows that more than 60% of Chinese urban residents' financial literacy is in a general or bad state.The low level of financial literacy restricts the allocation performance of pension planning and asset management,which,as a result putting a potential negative impact on the welfare of the elderly.This paper not only studies the impact of financial literacy on pension decision-making and asset allocation of Chinese urban residents before and after retirement.This paper but also analyzes the typical facts of urban residents' financial literacy and pension decision-making by using China consumer financial literacy survey report(2019),further more,studying the influence of financial literacy on pension decision-making before retirement and asset allocation after retirement by using China family tracking survey data(CFPS).In view of the asset allocation behavior before retirement,this paper explores the impact of financial literacy on pension planning and future pension asset allocation.Using IV probit two-stage instrumental variable regression alleviates the endogenous problem caused by reverse causality and constrains the endogenous problem caused by missing variables.The financial literacy is divided into subjective financial literacy,objective financial literacy,basic financial literacy and advanced financial literacy.The impact of different types of financial literacy on pension planning and asset allocation is tested.In view of the asset allocation behavior after retirement,this paper focuses on the influence of financial literacy on the asset allocation decision-making of consumption,debt and other assets in the elderly stage,as well as the influence of financial literacy on the diversified asset allocation after retirement.In addition,in the further study of the influence of financial literacy on pension decision-making and asset allocation,we also use micro panel data to analyze the impact of asset allocation before and after retirement.In order to clarify the internal mechanism of financial literacy's impact onpension decision-making and asset allocation,policy shocks such as reform and opening-up and family planning are introduced to expand the research on the relationship between them,and further peel off the background heterogeneity's disturbance on the asset allocation effect of financial literacy.The core conclusions of this paper are as follows: first,pre retirement financial literacy has a significant positive impact on pension planning and asset allocation.In the process of improving the pension of urban residents,through the promotion of different financial literacy can effectively improve the pension situation of different groups.Housing price has a significant positive impact on the future endowment asset allocation,which means that investment in housing is a means to protect the endowment.However,by contrast the negative impact of housing prices on pension planning also shows that excessive dependence on "housing for the aged" will lead to a reduction in the planning of future pension,which is easy to lay a big hidden danger for future pension.In addition,through the study of the average financial literacy of the community,we find that the positive promotion of information consumption among the urban residents in the region means that the way of life of the community agglomeration can also improve the pension;secondly,the difference between the basic financial literacy and the advanced financial literacy on the asset allocation,pension consumption and pension liabilities after retirement shows that the reasonable asset allocation of pension assets Accumulation of wealth,in order to protect consumption in the old age is the key to protect the elderly,in this process,the means of debt can also alleviate the pressure of consumption for the elderly;thirdly,in addition to the accumulation of financial knowledge,cultivating better independent financial behavior can also effectively improve the situation of the elderly.There is no denying that financial literacy can affect the diversified allocation of pension assets,so as to cope with the problem of too single pension assets and weak anti risk ability.What's more,It can also alleviate the impact of policy events on pension and enhance the stability of pension life.Financial literacy in different periods has different effectson asset allocation for the aged.Speaking of the choices we make a more stable asset allocation strategy to cope with the great changes in living conditions near retirement is necessary.