Scale name: Financial Risk Tolerance
Description: This instrument taps individuals’ attitudes toward risk, specifically, as applied to financial investing for retirement.
Source: Jacobs-Lawson, J. M., & Hershey, D. A. (2005). Influence of future time perspective, financial knowledge, and financial risk tolerance on retirement savings behaviors. Financial Services Review, 14, 331-344.
Cronbach's alpha: 0.83
Response format: Likert-type response format (1 = strongly disagree; 7 = strongly agree)
Instructions: Using the seven-point scale below, please indicate the extent to which you agree or disagree with each of the following statements.
1. I am willing to risk financial losses.
2. I prefer investments that have higher returns even though they are riskier.
3. The overall growth potential of a retirement investment is more important than the level of risk of the investment.
4. I am very willing to make risky investments to ensure financial stability in retirement.
5. As a rule, I would never choose the safest investment when planning for retirement.