The determinants of retirement planning decisions by adopting a private retirement scheme (PRS) among young working adults in Malaysia

Chai, Li Min and Hong, Hui Yi and Lee, Yong Jie and Tay, Ming Ming and Tong, Jia Yee (2026) The determinants of retirement planning decisions by adopting a private retirement scheme (PRS) among young working adults in Malaysia. Final Year Project, UTAR.

PDF Download (1845Kb)

Abstract

This study investigates the determinants influencing retirement planning decisions, specifically concerning the adoption of the Private Retirement Scheme (PRS) by young working adults in Malaysia. Given Malaysia's demographic shift towards an ageing population and the escalating concerns regarding inadequate retirement savings, the Employees Provident Fund (EPF) alone is deemed insufficient. Despite the introduction of the PRS as a supplementary voluntary savings mechanism, its adoption remains relatively limited, particularly within the younger demographic. Therefore, this study aims to investigate the key factors influencing PRS adoption, specifically attitude towards PRS, financial literacy, government policy, and income level. The quantitative research approach was used, and primary data were gathered via structured questionnaires that were sent to young working adults. Statistical analysis methods such as descriptive analysis, reliability test, and multiple regression analysis were used to analyze the data. The results indicate that the attitude towards PRS significantly affects the PRS adoption whereas financial literacy, government policy, and the level of income have weaker or insignificant effects. The research has identified the need to create positive attitudes and the need to increase financial capabilities to increase the ability to participate in voluntary retirement schemes. The findings are informative to policy makers, financial institutions, and service providers in developing more effective policies to facilitate retirement planning among the young Malaysians. Finally, this study will help enhance financial readiness and long-term retirement in Malaysia.

Actions (login required)