[Research Contribution] Factors Affecting Early Retirement Intention: The Moderating Role of Financial Literacy – Evidence from Vietnam
27 November, 2025
Keywords: financial literacy; retirement planning; early retirement; personal financial management
As Vietnam’s population enters a rapid aging phase, the trend of early retirement is becoming increasingly prevalent, posing significant challenges to the social security system and the labor market balance. Globally, studies on early retirement behavior have highlighted the roles of health, working conditions, and individual psychology; however, the aspects of personal financial management and financial literacy have received limited attention, especially in emerging economies. Motivated by this context, a study by researchers from UEH Mekong – University of Economics Ho Chi Minh City (UEH) – focuses on analyzing the factors influencing the early retirement intention of Vietnamese workers. It also clarifies the moderating role of financial literacy in the relationship between financial, social conditions, and retirement decisions, offering crucial insights for national policymaking and human resource management strategies.
Population Aging and the Early Retirement Trend: A Challenge for Vietnam’s Social Security and Labor Market
In recent decades, the trend of population aging has become a major challenge for many nations. Maintaining the stability of the social security system, particularly pension funds, depends significantly on the retirement age and the labor force participation rate. Many international organizations have recommended that countries adjust their policies to extend the retirement age to ensure the sustainability of these funds. However, a noteworthy reality is that many workers still wish to retire earlier than the statutory age, raising concerns about future imbalances in pension funds and labor supply.
In Vietnam, this issue is becoming increasingly urgent. Although currently in a “golden population” phase, its pace of population aging is among the fastest in the region. The population over 60 will constitute a growing proportion, placing immense pressure on the social security system in the coming decades. Meanwhile, the trend of early retirement is becoming more common, especially among younger workers, directly impacting the labor balance—a key factor for economic growth—and increasing the burden on the national pension system.
What are the reasons behind Vietnamese workers’ intention to retire early? Are personal finance and financial literacy decisive factors? And what can policymakers do to help citizens make more rational choices that both meet individual aspirations and ensure societal benefits? This is the rationale behind the study “Factors Affecting Early Retirement Intention: The Moderating Role of Financial Literacy – Evidence from Vietnam.”
The study targets Vietnamese workers, particularly Millennials and Gen Z—groups that are in the career-building and wealth-accumulation phase and are increasingly interested in the goal of “financial independence, retire early” (FIRE).
Factors Influencing the Early Retirement Intention of Vietnamese Workers
The research is built on two main theoretical foundations. First, life course theory posits that life decisions, including retirement, do not occur in isolation but are influenced by social, historical, and cultural contexts. Retirement is thus viewed as a continuous process where individuals weigh factors such as health, finance, family, and work. Second, the theory of planned behavior emphasizes that human behavior is shaped by attitudes, social norms, and perceived behavioral control. Combining these theories, the research team proposes that personal financial management, financial literacy, family pressure, working conditions, and social perspectives can collectively influence the early retirement intention of Vietnamese workers.
To test these hypotheses, the authors collected 760 valid survey responses between October and December 2023, with a diverse sample in terms of gender, occupation, education, and marital status, focusing primarily on younger age groups. This is the potential labor force that will shape retirement trends over the next 20–30 years. The study’s variables were measured using reputable international scales for financial management, retirement intention, and financial literacy. The data was analyzed using modern quantitative methods, combined with subgroup analysis based on financial literacy levels to compare differences between high and low literacy groups.
The research yielded several noteworthy findings. First, personal financial management was found to be the most influential factor affecting financial accumulation behavior, which in turn positively impacts retirement intention. When workers have financial discipline and clear spending plans, they not only proactively save for the future but also feel more confident in making retirement decisions. Family pressure also emerged as a significant factor: individuals with responsibilities for caring for children or elderly relatives often wish to retire early to spend more time with their families—reflecting the Vietnamese cultural characteristic of valuing family cohesion.
Additionally, perceived behavioral control—the level of confidence in one’s ability to manage finances and life after retirement—also significantly influences retirement intention. Conversely, a positive attitude towards retirement did not show a clear impact and even trended in the opposite direction, suggesting that individuals with high expectations for post-retirement life often consider their decision more carefully before leaving the labor market. Working conditions and social perspectives did not have as strong an influence as expected, differing from findings in European studies where the work environment and welfare policies are considered decisive factors.
Another notable finding is that financial literacy, although it did not demonstrate a strong moderating role as initially hypothesized, still created clear differences between groups. In the high financial literacy group, the relationship between retirement intention and financial accumulation behavior was stronger, indicating that financial knowledge helps workers translate their intentions into concrete actions toward the goal of “financial independence, retire early.”
Policy Implications and Practical Applications
Based on these research findings, the authors propose several policy directions and practical solutions to promote proactive retirement preparation in Vietnamese society.
First, enhancing financial literacy for workers should be considered a sustainable foundation. While it may not directly determine retirement intention, financial literacy acts as a “key” that helps individuals transform their plans into concrete actions. Integrating financial education into schools, organizing community training programs, and disseminating personal financial management skills through mass media are all long-term, sustainable solutions.
Concurrently, creating a flexible and humane working environment is another crucial factor. A healthy work environment that emphasizes work-life balance can help workers reduce stress, maintain physical and mental well-being, and extend their professional careers. This is not just a human resources policy but also a sustainable development strategy for businesses and the nation in the context of an aging population.
Finally, developing supplementary pension programs and suitable financial products is a practical approach. Expanding voluntary pension funds, life insurance products, and retirement savings programs co-developed by businesses and financial institutions will provide workers with more options, increasing their financial security after leaving the labor market.
Overall, the study not only provides scientific evidence for behavioral theories in the Vietnamese context but also holds profound practical significance for workers, businesses, and policymakers. Understanding and applying these research findings will contribute to promoting a sustainable social security system, aiming for a prosperous society that can proactively adapt to population aging.
Read the full research paper: Factors Affecting Early Retirement Intention: The Moderating Role of Financial Literacy – Evidence from Vietnam HERE
Authors: Nguyen Van Tien Son, MA. Tran Ngoc Hoa, MA. Truong Thi Nhi – University of Economics Ho Chi Minh City.
This article is part of the series spreading research and applied knowledge with the message “For a More Sustainable Mekong,” under the “Research Contribution For All” program implemented by UEH. UEH cordially invites readers to look forward to the next UEH Research Insights newsletter.
News, photos: Authors, UEH Mekong Department of Admissions and Communications, UEH Department of Communications and Partnerships
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