The Impact of Income on Rural Residents’ Retirement Saving: Evidence from China

Population aging is a fundamental national condition that runs through China in the 21st century. The aging degree of rural areas in China is high, but the government-sponsored retirement plans have difficulty in meeting the retirement living needs. Guiding rural residents to save for retirement is the main way to alleviate the economic pressure of retirement life in rural areas. This paper uses data from the CAFF50 Survey to examine the impact of income level and income uncertainty on the retirement saving behavior of rural residents. Different from existing literature, this paper categorizes the retirement saving behavior into three aspects: “retirement saving decision”, “retirement saving amount”, and “retirement saving way choice”. The results show the following: (1) Income level has a positive impact on the retirement saving decision, saving amount, the choice of real estate, and a negative impact on the choice of bank savings. (2) Income uncertainty has a positive impact on retirement saving decision, the choice of stock and fund, and a negative impact on the choice of bank savings, but the impact of income uncertainty on the amount is not significant. (3) There is an interaction effect between income level and income uncertainty on the impact on retirement saving amount, bank savings choice, and real estate choice. Based on the above conclusions, we think that it is necessary to increase fiscal subsidies and tax incentives, optimize retirement financial products, provide retirement financial education, and increase the participation enthusiasm of rural residents in retirement savings.