An Analysis of Socio-Economic Determinants Affecting Retirement Adjustment and Life Satisfaction Among Public Retirees in The Klang Valley

Abstract

Malaysia is projected to become an ageing nation by 2045. Given this unfavourable demographic trend, this ageing phenomenon poses a number of socio-economic challenges as longevity rises over time and lengthens the time spent in retirement. Using the Structural Equation Modelling (SEM), the objective of this study was to determine the socio-economic factors affecting the retirement adjustment and subsequently examine the impact of those factors on life satisfaction among public retirees during their retirement. Despite the common beliefs, retirement is associated with productive aging rather than being a burden on society and the country. This study employed secondary data from a survey of public retirees in Malaysia's largest urbanised region, the Klang Valley, which represented 23% of all public retirees in the country from October 2017 to February 2018. The results show that income, healthcare, and retirement readiness have significant impacts on retirement adjustment, which in turn partially mediates life satisfaction. The findings are expected to support the policymakers in developing a retirement framework that prioritises the needs of Malaysian retirees. Policymakers should consider marketing strategies that utilise the right communication tools, visuals, and consistent language to ensure that public retirees adjust effectively during the retirement phase and pursue a greater sense of life satisfaction.