Financial Inclusion, Inequality, and Retirement Trends among Older Workers

The research created a financial inclusion index with three dimensions: usage, barriers, and access to financial resources. A Principal Component Analysis was used to determine the weights for each dimension. This index aids in evaluating how financial inclusion affects various factors, such as ethnic groups, minorities, human capital, retirement, wealth outcomes, and mental well-being. Our findings have uncovered new psychological and sociological effects of having access to financial products. Households with higher financial inclusion scores are likelier to have higher income, own homes, and possess real estate wealth. They also have a greater chance of creating intergenerational wealth and escaping poverty. Financial inclusion leads to long-term improvements in wealth and retirement outcomes, benefiting minority groups and genders. It also improves family and work resilience, reduces stress, and lowers drug-related problems. Results have several policy implications, including bridging the wealth gap, enhancing retirement security, and bettering socioeconomic outcomes.