Examining the association between robo-advisory and perceived financial satisfaction
Abstract
Purpose
Robo-advisory has become an increasingly popular asset management tool in recent decades. This paper studies the association between robo-advisor usage and perceived financial satisfaction.
Design/methodology/approach
Using data extracted from the National Financial Capability Study 2015 (NFCS2015), the present study carried out a logistic analysis that examines the association between robo-advisory and perceived financial satisfaction. This model also studies the interaction effect of age on this association.
Findings
The present study finds that robo-advisor usage is positively correlated with a person’s perceived financial satisfaction after controlling for covariates related to financial literacy and other demographic factors. Moreover, the present study reveals that age moderates the association between robo-advisory usage and financial satisfaction. The results are robust after regressing financial satisfaction on robo-advisory by different age groups.
Originality/value
This paper extends existing literature on robo-advisory by showing that robo-advisory usage relates to a higher level of financial satisfaction. This finding helps understand the rapidly increasing trend of robo-advisory in the financial industry. Moreover, the present study reveals a moderate effect of age on the association between robo-advisory usage and perceived financial satisfaction.
Keywords
Acknowledgements
The author would like to thank the FINRA Foundation for providing the data (i.e. the National Financial Capability Study 2015 cohort) used in the present study.
Citation
Bai, Z. (2024), "Examining the association between robo-advisory and perceived financial satisfaction", Review of Behavioral Finance, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/RBF-10-2023-0268
Publisher
:Emerald Publishing Limited
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