Determinants of Malaysians' intention towards private retirement scheme (PRS) participation in Klang Valley, Malaysia

Lin, Kok Leong (2025) Determinants of Malaysians' intention towards private retirement scheme (PRS) participation in Klang Valley, Malaysia. PhD thesis, UTAR.

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Abstract

The increasing interest in Private Retirement Schemes (PRS) in Malaysia highlights a changing retirement planning environment influenced by demographic changes, economic factors, and shifting societal norms. PRS is a crucial element of Malaysia's multi-tiered pension system, intended to complement the mandatory pension fund, the Employee Provident Fund (EPF). The study aims to develop a comprehensive understanding of the social, marketing, and personal aspects of PRS in Malaysia. Specific objectives of the study include investigating the determinants within social, marketing, and personal dimensions that influence attitudes and intentions towards PRS participation in Malaysia, analysing the relationship among firm-created social media, user-generated social media communication, and social influence of the social aspects and attitudes towards PRS, examining the relationship among transaction costs, advertisement, and brand image of the marketing aspects and attitudes towards PRS, and examining the relationship among financial literacy, financial risk tolerance, personal trust, and investment experience of the personal aspects and attitudes towards PRS. The study also explores the mediating effect of attitudes towards PRS and the moderating effects of government support, age, and income. This research is guided by theoretical frameworks such as Theory of Planned Behaviour, Symbolic Interaction Theory, and Life Cycle Theory. A quantitative study with 501 respondents in Klang Valley was conducted using convenience sampling. Statistical methods like SPSS and SmartPLS were employed to test hypotheses. The results reveal significant mediating effects of social influence, transaction costs, advertisements, financial literacy, risk tolerance, personal trust, and investment experience on attitudes towards PRS. Additionally, income significantly moderates the relationship between attitudes and PRS participation. Contrary to the initial assumption that PRS would serve as an alternative to EPF, the findings suggest that while PRS contributes to diversification in retirement planning, it does not present itself as a standalone substitute for EPF. Rather, it complements the EPF by offering more flexibility to certain segments of the population. The findings also highlight critical policy implications: to encourage broader participation in PRS, targeted government incentives, enhanced financial literacy programs, and marketing strategies that reduce perceived transaction costs are essentials. Keywords: Social aspects, marketing aspects, personal aspects, private retirement scheme, Malaysia

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