This study identified and tested some factors that affect retirement savings decisions in
Botswana; a country that is influenced by both modern and traditional approaches to
retirement. Concern the world over has been growing about the low retirement savings of
many individuals in both developed and developing countries. This situation has been
compounded by the Global Financial Crisis of 2008 and has been further complicated by
many governments shifting the risks and responsibilities of retirement savings investments
into the hands of individuals, most of whom are ill-equipped to make complicated financial
decisions.
Three cadres of the University of Botswana employees, namely; academic, support and
industrial staff, took part in the study. The Theory of Planned Behaviour (TPB) was used
as a framework to investigate the behavioural intention and possible policy interventions
for these employees` retirement savings.
Structural Equation Modelling (SEM) was used to test the relationships and mediation
effects of the constructs used in this study. Subjective norms, financial literacy, and
attitude were found to have positive effects on intentions to make additional voluntary
contributions to retirement savings in the next 12 months. In addition, attitude mediates
the relationships between 1) subjective norm and retirement savings intention, and 2)
financial literacy and retirement savings intention. An analysis of the results reveals that
the Theory of Reasoned Action (TRA) and not Theory of Planned Behaviour, together with
financial literacy, predict the intention to save for retirement. With these results in mind,
intervention efforts targeting attitudes, subjective norms, financial literacy and other
incentives will aid policy designed to induce additional voluntary retirement savings.
Theoretical and managerial implications of the findings and their generalisability are
discussed, the limitations of the study are pointed out, and directions for further research
are explored.