Overconfidence and Financial Risk Tolerance in Older Age.

IF 4.8 2区医学 Q1 GERIATRICS & GERONTOLOGY

Journals of Gerontology Series B-Psychological Sciences and Social Sciences Pub Date : 2025-02-19 DOI:10.1093/geronb/gbaf032

Colleen C Frank, Gary R Mottola, Meiru Chen, Lei Yu, Patricia A Boyle, Gregory R Samanez-Larkin, Kendra L Seaman

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Abstract

Objectives: Excessive financial risk taking in older age can have harmful consequences as opportunities to recover lost wealth are limited. Understanding financial risk taking in older age is important for identifying vulnerabilities and developing interventions to empower aging investors to make wise financial choices. In this paper, we explore how overconfidence in financial knowledge affects financial risk-taking among older adults.

Methods: We examine this research question in older adults aged 58-101 (N = 1242) using data from the Rush Memory and Aging Project (MAP).

Results: After controlling for demographics, overconfidence was associated with self-reported financial risk tolerance such that those who were more overconfident reported tolerating more financial risks. Moreover, this relationship emerged for both healthy older adults and those diagnosed with mild cognitive impairment (MCI). However, overconfidence did not predict performance on a behavioral measure of risk aversion.

Discussion: The present results suggest that overconfidence may partially contribute to financial risk-taking in older adults, regardless of cognitive status. Thus, interventions aimed at calibrating confidence to actual levels of financial knowledge could be an impactful target for intervention.

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来源期刊

Journals of Gerontology Series B-Psychological Sciences and Social Sciences 医学-老年医学

CiteScore

11.60

自引率

8.10%

发文量

178

审稿时长

6-12 weeks

期刊介绍： The Journal of Gerontology: Psychological Sciences publishes articles on development in adulthood and old age that advance the psychological science of aging processes and outcomes. Articles have clear implications for theoretical or methodological innovation in the psychology of aging or contribute significantly to the empirical understanding of psychological processes and aging. Areas of interest include, but are not limited to, attitudes, clinical applications, cognition, education, emotion, health, human factors, interpersonal relations, neuropsychology, perception, personality, physiological psychology, social psychology, and sensation.