Financial Literacy and Pension Strategies: Evidence from Russia

Abstract

The global issue of population ageing affects the financial capabilities of solidarity pension systems to provide an acceptable level of pension payments. To maintain their standard of living in old age, people need to ensure additional sources of income in advance. The study analyses which pension strategies are more frequently chosen by financially literate Russians. Based on panel data from the All-Russian Survey of Consumer Finance for four waves (2018, 2020, 2022, and 2024) and a fixed effects model, no relation was found between financial literacy and the strategy of forming savings in non-governmental pension funds. Financially literate respondents are more likely to rely on personal savings and continue working after retirement as well as to diversify their pension strategies more often. The results are robust to changes in model specification (set of variables, types of regressions, size, and composition of samples).