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Adults Make Riskier, More Inconsistent Decisions As They Get Older, Study Finds

Soulskill posted about 7 months ago | from the they-have-more-reason-to-worry-about-the-short-term dept.

News 225

schliz writes "People aged over 65 make poorer financial decisions and more inconsistent choices than younger individuals with the same IQ, an international research group has found. The study (abstract) had 135 healthy participants aged 12-90 make a series of decisions: for example, choosing between gaining $5 and the chance to win $20 in a lottery. On average, over-65s earned 26-39% less than all other age groups, including adolescents — a finding that could partially explain their susceptibility to problem gambling and scams."

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225 comments

They've got money to burn (2, Insightful)

BenSchuarmer (922752) | about 7 months ago | (#45005717)

and they have to get rid of it somehow.

Re:They've got money to burn (5, Insightful)

CanHasDIY (1672858) | about 7 months ago | (#45005727)

OR, they're more worried about fiscal security at the end of their lives, and fear of things like being shoved in a crappy nursing home and having all their possessions sold off frightens them into taking risks they wouldn't otherwise consider.

Not all people over 65 are rich, you know; fact is, most are quite the opposite.

Re:They've got money to burn (0, Funny)

Anonymous Coward | about 7 months ago | (#45005805)

Because of gambling problems and scams.

Re:They've got money to burn (0, Troll)

Anonymous Coward | about 7 months ago | (#45006007)

Not all people over 65 are rich, you know; fact is, most are quite the opposite.

Your "soap line" America where the elderly eat dog food is a fiction that exists in the minds of dupes that swallow the lamentations and whining of pressure groups. The US elderly are the wealthiest class of people in the history of the species. They've voted themselves a nice suite of bennies to offset the cost of their fifth wheels, boats and cabins. Today, as in Oct. 1, 2013, they've managed to bridle their grand-kids to fund even more healthcare; a cost they did not pay for their own elders.

Erratic financial decisions are a symptom of excessive disposable wealth.

Re:They've got money to burn (-1, Troll)

Anonymous Coward | about 7 months ago | (#45006147)

Yep. Obamacare is a massive wealth transfer from the young to the old, from the healthy to the unhealthy. The last obamacare story was full of comments from people who are uninsurable due to their massive obesity.

Should car insurance companies charge all drivers the same, regardless of previous accidents or drunk driving convictions? Only if you drive an obamamobile!

Re:They've got money to burn (4, Informative)

Anonymous Coward | about 7 months ago | (#45006261)

Not all people over 65 are rich, you know; fact is, most are quite the opposite.

Your "soap line" America where the elderly eat dog food is a fiction that exists in the minds of dupes that swallow the lamentations and whining of pressure groups. The US elderly are the wealthiest class of people in the history of the species. They've voted themselves a nice suite of bennies to offset the cost of their fifth wheels, boats and cabins. Today, as in Oct. 1, 2013, they've managed to bridle their grand-kids to fund even more healthcare; a cost they did not pay for their own elders.

Erratic financial decisions are a symptom of excessive disposable wealth.

Dude, i am as pissed about what the baby boomers have done to this nation as any other person not in that generation, but seriously, stop being an asshole. It is not a myth that their are many poor to lower middle class folks (particularly women and minority) folks over 65 that have to worry greatly about how they are going to end their days. I am only 45 and doing decently and I am panicked about it, and my poor mother is doubly so (while my rich asshole father is happily frittering his days away and donating to tea party assholes).

A lot of folks over 65 were just as screwed by the fat cats that made sure their retirement was going swimmingly while passing the cost on to others. There is significant desperation even amongst the baby boomers and for the same reasons. Only they are less able to distract themselves, if only because they are literally less physically able to do so. Why to you think old age alcoholism and suicide are such issues? Is it because they are so rich that the worldly ennui is killing them, or is it maybe that they can no longer deny how fucked they are? appreciate your youthful self confidence while you can, it gets harder as you get older, unless you are one of the lucky rich ones.

Re:They've got money to burn (0)

Anonymous Coward | about 7 months ago | (#45006265)

As a member of the over 65 set, I have only one word for your drivel: Rubbish!

Re:They've got money to burn (-1)

Anonymous Coward | about 7 months ago | (#45006283)

Citation? Right, you have none because all the scientific literature you might possibly dig up says the opposite.

Re:They've got money to burn (3, Informative)

bitt3n (941736) | about 7 months ago | (#45006101)

OR, they're more worried about fiscal security at the end of their lives, and fear of things like being shoved in a crappy nursing home and having all their possessions sold off frightens them into taking risks they wouldn't otherwise consider.

The study says fogies prefer less risk.

Compared to other age groups, older adults tended to prefer to lock in guaranteed earnings over gambling on a bigger win.

Now you can turn your theory around to make it about how the poor elderly are fearful of losing what little they have etc. etc., should work just as well for you.

Re:They've got money to burn (0)

Anonymous Coward | about 7 months ago | (#45006315)

> The study says fogies prefer less risk.

I don't know what you mean by "prefer".
The summary/title of the /. article says they take more risk.

Re:They've got money to burn (4, Insightful)

icebike (68054) | about 7 months ago | (#45006321)

Mod parent up.

That's pretty much the way I read it too.

Old folks don't necessary look at the world as a place where you buy a few shares of Apple or Google and wait for it to grow, or where you throw money into a gambling addiction expecting your luck has to turn someday.

The author tries to spin simple fiscal conservatism as something irrational. But older people know the odds are always in the houses favor, and are less willing to play that game. Sounds like the people with gambling addiction were the people writing the story.

Re:They've got money to burn (5, Interesting)

ShanghaiBill (739463) | about 7 months ago | (#45006401)

The study says fogies prefer less risk.

Not quite. The study found that geezers are less willing to take a risk to win, but more willing to take risks to avoid a loss. In many cases they were avoiding good risks and taking bad risks. Overall, they were making worse decisions than younger people when either accepting or declining risks.

Re:They've got money to burn (1)

icebike (68054) | about 7 months ago | (#45006233)

Just as likely, the older folks saw thru the research and a painless way to bet on a big score, something they seldom actually do in
real live.

As for unacceptability to scams, you really only see this in people new to the internet or who never had to deal with dishonest merchants before, perhaps because a deceased loved one took care of that for them in the past. Unless there is an under lying dementia problem old folks are harder to fool than kids, or even 20-somethings.

Re:They've got money to burn (2)

ShanghaiBill (739463) | about 7 months ago | (#45006477)

Not all people over 65 are rich, you know; fact is, most are quite the opposite.

The typical U.S. household headed by a person age 65 or older has a net worth 47 times greater [boston.com] than a household headed by someone under 35. This wealth gap is now more than double what it was in 2005 and nearly five times the 10-to-1 disparity a quarter-century ago.

Re:They've got money to burn (4, Interesting)

ebusinessmedia1 (561777) | about 7 months ago | (#45005803)

"On average, over-65s earned 26-39% less than all other age groups, including adolescents — a finding that could partially explain their susceptibility to problem gambling and scams."

Might this have something to do with the fact that age discrimination is ripe in the workplace. Try landing a well-paying corporate gig if you are over 60, no matter your skill set. It's nigh impossible. And, with decreasing job opportunities for workers over 60, one can imagine that some significant minority of them become more desperate to the point where they begin to consider irrational alternatives to making ends meet. Of course, this doesn't eliminate the fact that very senior individuals - some with excess money to burn, use that money to fill the ever-increasing, yawning gap of boredom and disconnection in their lives brought on by the social isolation of the elderly in our culture. So, I think this is more of a structural problem.

Re:They've got money to burn (3, Informative)

yagu (721525) | about 7 months ago | (#45005857)

... Might this have something to do with the fact that age discrimination is ripe^W rife in the workplace ...

FTFY

Re:They've got money to burn (1)

skids (119237) | about 7 months ago | (#45006229)

...though that could have been a pun on the aged. Or half a spoonerism.

Re:They've got money to burn (3, Insightful)

h4rr4r (612664) | about 7 months ago | (#45005863)

A lot of that isolation is self enforced. Of course no one wants to visit great-grandma when she just wants to scream racist gibberish about the president and homophobic crap about your cousins. Old people often have beliefs that are simply not compatible with living in a modern society. You can't take them into public if you fear they may call your waiter the N word or go on a tirade about the jews when you are trying to get groceries.

Re:They've got money to burn (5, Interesting)

realityimpaired (1668397) | about 7 months ago | (#45005991)

My (german) grandmother has advanced alzheimer's, and is has reverted pretty much to her childhood. On a good day, she's in her 20's (which covers the period from 1939-1945). She has been known to wax poetical about Hitler, and has interesting ideas about homosexuals, gypsies, and the jews.

I still visit her. I leave my girlfriend at home when I visit her, and smile politely when she tries to introduce me to men she knows (knew back then). One time, she tried to hook me up with my uncle. At family events, my GF is "a good friend who didn't have anybody to visit" for the benefit of my grandmother. You may choose to sweep the elderly under the rug, I choose not to. We can still be compassionate in how we treat them, and there are constructive ways to deal with people who hold beliefs that we disagree with.

Re:They've got money to burn (1)

h4rr4r (612664) | about 7 months ago | (#45006205)

There are beliefs we don't agree with and then there are people who would rather see you dead.

Imagine if your grandmother found out about your girlfriend, what would you do then?

Re:They've got money to burn (0)

Anonymous Coward | about 7 months ago | (#45006523)

That happened to one of my elderly relatives. The correct answer is: nothing because they won't remember tomorrow. For a while, we passed the point of spite and would let her know what happened and she would go off and the rant was almost word-for-word identical every time. Then it transitioned to pity. But now there is some solace in the fact that, even though many people her age are racist, homophobic, etc. at least she doesn't bow to societal pressure and keep her mouth shut. Speaking your mind is something I can respect.

Re:They've got money to burn (2)

Dr. Sheldon Cooper (2726841) | about 7 months ago | (#45006119)

You can't take them into public if you fear they may call your waiter the N word or go on a tirade about the jews when you are trying to get groceries.

I have had both of these things happen to me on more than one occasion. Each time it was as if the world went in to slow motion and I could not get my mother out of the area fast enough. At one point in a particularly awkward situation I seriously thought someone was going to punch my 73-year-old mother in the face. No matter how many times I try to explain to her that she MUST stop speaking that way, she just doesn't seem to get it, or she just doesn't care.

Re:They've got money to burn (1)

cayenne8 (626475) | about 7 months ago | (#45006451)

You can't take them into public if you fear they may call your waiter the N word or go on a tirade about the jews when you are trying to get groceries.

I have had both of these things happen to me on more than one occasion. Each time it was as if the world went in to slow motion and I could not get my mother out of the area fast enough. At one point in a particularly awkward situation I seriously thought someone was going to punch my 73-year-old mother in the face. No matter how many times I try to explain to her that she MUST stop speaking that way, she just doesn't seem to get it, or she just doesn't care.

So, I'm guessing there were a bunch of blacks around you when she started saying the word nigger, and you were afraid of them punching her? Was she not aware of her surroundings at the time?

Re:They've got money to burn (1)

lgw (121541) | about 7 months ago | (#45006225)

You may have odd grandparents. On the whole, I find there's as much to learn from previous generations as there is to discard.

There's this growing, worrying tendency on the left side these days to simply dismiss out of hand anyone who says anything against orthodox beliefs. Yes, it's perfectly possibly that someone who thinks gays are bad has valuable insights to offer in unrelated areas of life, if you can keep an open mind about cultures different from yours.

Of course, the right has always had this problem (and how!), but there at least for old people it's balanced by the natural tendency of conservatives to value "old ways". We could really do without the close-mindedness in both camps, but it's somehow more disturbing on the left.

Re:They've got money to burn (1)

h4rr4r (612664) | about 7 months ago | (#45006273)

Actually I was speaking about inlaws, but whatever.

I think I did not explain adequately, they don't want to talk about anything else. They only want to discuss what that seekrit mooslim ursurper has done now to hand over the country to the devil or how your friends and family will rot in hell for being gay or whatever. They have no interest in discussing valuable stuff, just whatever they heard from similar nuts.

I never mention I am an atheist for example, I don't want to fight about it, but they have to start trouble with these other topics.

Re:They've got money to burn (1)

Jeff Flanagan (2981883) | about 7 months ago | (#45006521)

LOL, you just reminded me of how my grandmother was. There was no stopping her going on about the Jews at home or in public. I do not miss having to take her shopping and to the doctor.

Re:They've got money to burn (1)

pla (258480) | about 7 months ago | (#45005931)

Might this have something to do with the fact that age discrimination is ripe in the workplace.

No. No, it might not. Know know I can tell you didn't even make it all the way through the FP summary? :)

TFA means that number as only in the context of this one experiment, not as a generalization about the incomes of the elderly.

Re:They've got money to burn (0)

Anonymous Coward | about 7 months ago | (#45006027)

They are talking about earning less on this test. I doubt that the test had anything to do with workplace discrimination. They were all taking a test where they could chose things like "take $5.00 now" and "take a chance on winning $20.00 but get nothing if you don't win". This was where they were earning. So there is no way anything to do with real workplaces factored into it.

Re:They've got money to burn (4, Informative)

macraig (621737) | about 7 months ago | (#45006111)

You didn't interpret even TFS correctly: the "earnings" were from the game to which the participants were subjected. It nothing at all to do with their employment prospects.

Re:They've got money to burn (1)

steelfood (895457) | about 7 months ago | (#45006407)

No, both TFA and you are conflating two different issues. Actually, there are three issues at play, two of which are mutually exclusive and the other two are related but not exactly the same.

Over 65 is retirement age. You're not socially expected to work anymore (though you may still need to). So the fact that seniors take more risks has nothing to do with age discrimination, which has the greatest effect on people between 55 and 65, i.e. below 65. Falling for a con is not the same as gambling, but the elderly are more susceptable to being conned as well.

The second line of thought is more reasonable: it's psychological. They're not interested in the losses incurred from risk, but are more interested in the off-chance of a reward. Because face it, the safe way has been done for 65 years already, i.e. they're bored with their life so far. In fact, that's pretty much how they got to retirement age. So they're more willing to incur a big loss if it also means a big reward.

The fucked up thing is that like all other things, it's easier to recover from a loss when younger than when older. So it's actually better to take these types of risks in youth, especially financial ones. What people calculate in their heads to largely stem this however, is that if they take a life-changing risk at 35, they could be living for 50 more years with the consequences of the risk (or 0 more years if the consequence is death). However, if they take the risk at 65, not only are they only going to live with its consequences for only 20 years, a 30 year reduction, they'd have lived 30 more years consequence-free (alive, in the case of death).

But I'd also say it's largely a product of natural selection. Early risk takers don't always survive to have children. So with every generation, only the less-risk prone members of society remain to pass their genes on.

Re:They've got money to burn (1)

TWiTfan (2887093) | about 7 months ago | (#45005891)

...or their memory goes, they get confused more easily, and they get targeted by con artists who specialize in bilking the elderly. Saw it happen to my grandpa. We finally had to lock down his accounts and appoint my uncle as a conservator. He was signing over his pension checks to every gypsy that came to his door. Then he would call his sons up, confused that his checks were suddenly bouncing.

Re:They've got money to burn (-1, Flamebait)

X0563511 (793323) | about 7 months ago | (#45006029)

That's quite offensive to Romani, you know. Gypsy is just as racist as nigger and kike...

Re:They've got money to burn (1)

TWiTfan (2887093) | about 7 months ago | (#45006429)

After what they did to my grandpa, I guess they'll just have to suck my dick then.

Who does these studies? (0)

Anonymous Coward | about 7 months ago | (#45005753)

Do they get paid for their "findings"? I'd like to get paid to make common sense observations, where do I sign up?

Re:Who does these studies? (1)

JazzHarper (745403) | about 7 months ago | (#45005867)

Psychology undergraduates. No, they don't get paid.

Re:Who does these studies? (1, Insightful)

dgreer (1206) | about 7 months ago | (#45005911)

Hmmm... so people with no practical experience in life are judging people with massive experience on the quality of their decision making abilities. What could POSSIBLY go wrong?

Re:Who does these studies? (0)

Anonymous Coward | about 7 months ago | (#45006303)

Who they are or how much experience they have is irrelevant to whether or not their conclusions and/or arguments are wrong.

Re:Who does these studies? (0)

Anonymous Coward | about 7 months ago | (#45006473)

They're not being judged. They did objectively worse on the test.

Re:Who does these studies? (0)

Anonymous Coward | about 7 months ago | (#45006023)

Psychology undergraduates. No, they don't get paid.

EVER.

Psychology majors get a degree with the next lowest earning-potential , following liberal arts.

Cut the kids some slack.

You reach a certain age and... (5, Insightful)

skids (119237) | about 7 months ago | (#45005757)

...someday you say to yourself "Look, for my entire life I've done the 'right thing' and even now it doesn't help my joints stop aching or buy me a bowel movement, so what the hell, let's try something else."

Re:You reach a certain age and... (3, Funny)

h4rr4r (612664) | about 7 months ago | (#45005771)

I am pretty sure you can buy a bowel movement. Heck, I can sell you one right now. Would you like it shipped UPS or Fedex?
Corn or no Corn?

Re:You reach a certain age and... (1)

Anonymous Coward | about 7 months ago | (#45005887)

Corn please, and extra smelly.

Re:You reach a certain age and... (1)

GerardAtJob (1245980) | about 7 months ago | (#45005829)

I'm pretty sure it's the exact opposite :

You take the same turn for 30 years now : YOU KNOW IT, so you optimize it a little bit (without thinking of course... it's a natural event here)... optimize it so much than it became inconsistent and risky... optimize it too much and... you know what I mean ;)

"Feeblemindedness" (4, Insightful)

TWiTfan (2887093) | about 7 months ago | (#45005769)

That's what my dad used to call it when it happened to grandpa. Grandpa went from being a shrewd businessman to being someone we had to keep an eye on at all times (he would fall for every con artist who showed up at his door). That why "Travellers" in particular prey on older people.

Re:"Feeblemindedness" (0)

Anonymous Coward | about 7 months ago | (#45005989)

Wow, the same thing happened with mine. From astute oil and agriculture, to get rich gold mining "investments" that depleted capital while he claimed it didn't. It was the "attention" and "respect" of the same sort of "Travelers" that seemed to falsely persuade them of their honesty, while he believed his children were just after his money.

Re:"Feeblemindedness" (0)

Anonymous Coward | about 7 months ago | (#45006001)

My grandpa wasn't like that. He believed everyone was a crook and was out to get him. "They're all crooks, I tell you, they're all crooks" he used to say. I hope I turn out the same way.

Re:"Feeblemindedness" (0)

bitt3n (941736) | about 7 months ago | (#45006009)

"Travellers"

if saying you got gypped is now socially unacceptable, is it OK instead to say you got traveled?

Re:"Feeblemindedness" (2, Insightful)

ninlilizi (2759613) | about 7 months ago | (#45006187)

Myself being a Rromani Traveller.

I would like to point out that all such racist stereotyping is unacceptable. Regardless weather you employ "cute" usage of quotation marks around proper nouns or not.

At no point should it be acceptable that /anybodies/ ethnic or racial background be a synonym for 'criminal'

(please don't mod me deep beneath the abyss... This needs to be said)

Re:"Feeblemindedness" (-1)

Anonymous Coward | about 7 months ago | (#45006467)

Maybe if your people stopped conning people and stealing, your reputation would improve.

Re:"Feeblemindedness" (1)

bitt3n (941736) | about 7 months ago | (#45006123)

Grandpa went from being a shrewd businessman to being someone we had to keep an eye on at all times (he would fall for every con artist who showed up at his door).

What's his address? I've got some great pills that will help him with that.

Fuck it. Gonna be dead soon any way..... (0)

Anonymous Coward | about 7 months ago | (#45005773)

Might as well bet the farm.

I think they were just bored (4, Insightful)

GrumpySteen (1250194) | about 7 months ago | (#45005783)

"Each participant were faced with 320 decisions: for example, choosing between gaining $5 and the chance to win $20 in a lottery."

After a few dozen questions like that, I'd be so bored that I'd start choosing randomly without thinking about it just to get it over with. There's no way in hell I would seriously think about each and every question out of a list of 320.

Re:I think they were just bored (4, Insightful)

h4rr4r (612664) | about 7 months ago | (#45005827)

Did they correct for income?

Kids and young folks are more motivated to get $5 since they have low resources. If you are retired, why not take the chance on $20 vs a sure $5 you don't need?

Re:I think they were just bored (2)

dgreer (1206) | about 7 months ago | (#45005959)

Not income, wealth. 60+ has one of the lowest income brackets, but it's the wealthiest. They already made their money, now it's time to have fun, hence playing the lotto.

Re:I think they were just bored (2)

Dopefish_1 (217994) | about 7 months ago | (#45006015)

If you are retired, why not take the chance on $20 vs a sure $5 you don't need?

But TFA says exactly the opposite occurred--"older adults tended to prefer to lock in guaranteed earnings over gambling on a bigger win".

The noteworthy part of the study is not simply that the elderly made less money, but that their decisions were inconsistent and irrational.

Re:I think they were just bored (2)

Lynal (976271) | about 7 months ago | (#45006033)

Did they correct for income?

Kids and young folks are more motivated to get $5 since they have low resources. If you are retired, why not take the chance on $20 vs a sure $5 you don't need?

Yes. They would need to.

The idea is this:

Would you take $1 or a coin flip for $2?
Would you take $5 or a coin flip for $10?
Would you take $10 or a coin flip for $20?

An `irrational' person would answer (Yes, No, Yes), or (No, Yes, No). Someone that answered all Yes or all No would not be inconsistent, nor would someone who answered (Yes, Yes, No) or (No, No, Yes), those people would be labeled as risk averse then risk loving.

As someone who has to sit through a lot of talks about research like this, GrumpySteen got it right in saying:

After a few dozen questions like that, I'd be so bored that I'd start choosing randomly without thinking about it just to get it over with. There's no way in hell I would seriously think about each and every question out of a list of 320.

A great paper on the topic is the 2001 paper "GARP For Kids", which asks the same question about children, and does a good job arguing that inconsistencies decrease with age going from young to college.

Re:I think they were just bored (1)

skids (119237) | about 7 months ago | (#45006277)

An `irrational' person would answer (Yes, No, Yes), or (No, Yes, No).

Actually those answers could be perfectly rational depending on how hungry you are, how much cash is in your wallet, and which fast food restaurants are within walking distance.

Re:I think they were just bored (0)

Anonymous Coward | about 7 months ago | (#45006509)

Exactly to take this to the extreme i might be perfectly rational for me to risk $1 to make $2 because $1 really doesn't effect me at all. but it would argue for me it would not be rational to risk 1 million dollars to make 2 million dollars because 1 million would have a huge effect on me. This point of not making sense to risk it would be different for everyone.

Re:I think they were just bored (1)

bitt3n (941736) | about 7 months ago | (#45006059)

Did they correct for income?

Kids and young folks are more motivated to get $5 since they have low resources. If you are retired, why not take the chance on $20 vs a sure $5 you don't need?

Except the study says fogies prefer less risk.

Compared to other age groups, older adults tended to prefer to lock in guaranteed earnings over gambling on a bigger win.

Re:I think they were just bored (1)

arobatino (46791) | about 7 months ago | (#45006317)

The article and the abstract didn't specify the probability of winning the $20 (the full paper is paywalled). In any case, the article said that old people were more likely to play it safe when gambling on earnings, so I'd guess that the probability was higher than 25% and they chose the $5 anyway, not the $20.

Re:I think they were just bored (2)

bgarcia (33222) | about 7 months ago | (#45005889)

For that matter, I think that once I reach age 65, I'll start to also become bored with life and start taking some chances here and there.

Call it "Walter White Syndrome". :-)

Re:I think they were just bored (1)

Krishnoid (984597) | about 7 months ago | (#45005961)

"Each participant were faced with 320 decisions: for example, choosing between gaining $5 and the chance to win $20 in a lottery."

After a few dozen questions like that, I'd be so bored that I'd start choosing randomly without thinking about it just to get it over with. There's no way in hell I would seriously think about each and every question out of a list of 320.

Sounds like someone's running low on blood sugar [nytimes.com]. Seriously, though, I wonder if they considered having to correct for that effect.

What do you have to lose at EOL? (4, Insightful)

medv4380 (1604309) | about 7 months ago | (#45005809)

If you figure you only have 5 to 10 more years left why not take a little more risk. When you have 50 years left to regret the choice it makes more sense to take less risk.

Re:What do you have to lose at EOL? (0)

Anonymous Coward | about 7 months ago | (#45005997)

or.....

"gotta spend it now, the damn kids aren't getting a penny!"

Re:What do you have to lose at EOL? (0)

Anonymous Coward | about 7 months ago | (#45006469)

If you figure you only have 5 to 10 more years left why not take a little more risk.

Then why do the elderly often drive so slowly and cautiously?

With your logic, I would expect the elderly to have fun and drive fast and furious, since they have less to lose.

Earning less (0)

Anonymous Coward | about 7 months ago | (#45005819)

On average, over-65s earned 26-39% less than all other age groups, including adolescents — a finding that could partially explain their susceptibility to problem gambling and scams."

Or maybe it could be that they are retired and living off of their savings, supplemented by a very small fixed income?

When you might only be years away from death.. (2)

ickleberry (864871) | about 7 months ago | (#45005821)

It makes sense to say "feck it!" and live whats left of life to the fullest. Young people would have it in their mind that they are going to be around for another 50-100 years. As I get older myself I find it more and more tempting to try something just to see what happens. When you are young you start off nice and naive and with little to lose so you make risky decisions, spend a couple of decades as a boring risk-averse PHB type who worries about absolutely everything but then after a while you will get tired of that too.

The world is ruled by grey-haired folk who are still a good bit away from retirement, have lots to lose (career, assets, life). Which explains why the world is getting more boring by the day.

Well that explains alot (3, Insightful)

halfEvilTech (1171369) | about 7 months ago | (#45005831)

I may get flamed for this but screw it. This would explain a lot of the issues we see from the Congress Critters.

I'm sure the NSA would flame you. (0)

Anonymous Coward | about 7 months ago | (#45006355)

But their /. control agents were considered non-essential.

Take a look at Congress (0)

Anonymous Coward | about 7 months ago | (#45005841)

Prime example if old fart way passed their mental prime.

Now I understand! (0)

Anonymous Coward | about 7 months ago | (#45005871)

That explains the current partial shutdown of the American Government and the state of politics in many countries.

The end of life sooner or later reaches (1)

parcifal32 (3288203) | about 7 months ago | (#45005893)

Unfortunately, all people reach a point in our lives where we were obsolete. Once we got to that moment we realize that as the business world beyond us and must give way to the youth and retire honorably.

explain me warren buffet and george soros then (0)

Anonymous Coward | about 7 months ago | (#45005943)

there are plenty of old ass dudes who are good with money...this is just more ageist bullshit from people who want to put the baby boomers out to pasture.

Re:explain me warren buffet and george soros then (1)

GameboyRMH (1153867) | about 7 months ago | (#45006471)

They're not senile yet or have people to manage their money for them. For example Rupert Murdoch is known to run his supercars out of gas. This isn't the kind of forethought that would let him keep his money, if he were managing it himself.

Maybe not (1)

djupedal (584558) | about 7 months ago | (#45005951)

Maybe it's just that the olders have more to lose (and more experiences, good/bad/otherwise, to pull from) so the risk goes up.

if someone did the same research with blacks... (-1)

Anonymous Coward | about 7 months ago | (#45005993)

they would be lynched as racist, so why is it ok to point out old people are stupid but not blacks?

This explains... (0)

Anonymous Coward | about 7 months ago | (#45006073)

My father's newfound obsession with guns.

Sad but True (1, Informative)

superid (46543) | about 7 months ago | (#45006145)

My dad is an engineer and has an MBA. He's 79 and been retired for a while. He could be the case study for this article. He has made horrible financial decisions for the past 15+ years despite a career of doing exactly the opposite.

Re:Sad but True (1)

Anonymous Coward | about 7 months ago | (#45006377)

Unless your father has lost his marbles, it's entirely possible he's like most of the rest of the USA: he got ripped off by two asset bubbles that were orchestrated by the Federal Reserve and Wall Street with a complicit Congress.

People didn't have to have lost their edge to lose their asse[t]s in 2000 and 2008.

Yoots (1)

Impy the Impiuos Imp (442658) | about 7 months ago | (#45006157)

Old people? Those late-nite ads for the new-style bidding web sites ate scams directed at young people. They are mathematically indistinguishible from gambling and should be treated as such.

Pay a dollar to bump up the price by 1 penny? Oop, someone else bumped it up another penny. You still lose your dollar. Guess who keeps all the dollars?

Well, thanks. (4, Funny)

roc97007 (608802) | about 7 months ago | (#45006169)

I was reading this in my car on the way to the payday loans place and I got so outraged that I drifted out of my lane and hit a parked gasoline tanker. So I figure I might as well park here and finish reading the thread. There's a lot of smoke but with the windows rolled up it isn't too bad.

Cognitive Biases (4, Interesting)

the eric conspiracy (20178) | about 7 months ago | (#45006173)

This sort of thing is in the general class of cognitive biases. Another example of this class is the Dunning Kruger effect.

Cognitive biases have a large negative effect on the financial performance of the general public. In particular if you want to be a successful investor it's very important to be aware of this issue.

Daniel Kahneman (a psychologist) won the 2002 Nobel Memorial Prize in Economics because of his pioneering work in the field of Behavioral Economics.

http://en.wikipedia.org/wiki/Daniel_Kahneman [wikipedia.org]

Speaking as a 30-something year old.... (0)

Anonymous Coward | about 7 months ago | (#45006241)

No fucking shit, because once you get past a certain point in life you realize you won't always have until tomorrow to find something better.

Did nobody learn anything from Breaking Bad? The principled or honest stand will only get you fucked by the end of your life, but if you can walk the thin line between dishonesty and criminal conduct you can become a weathy pharmaceutical magnate with everybody loving you and lots of 'paltry' philanthropic expenses which make everybody love you like you're freaking Jesus come to Earth.

While the previous paragraph was mostly intended in jest and not as a path to a successful life, I'm sure plenty of you know people RL who fall into the Gretchen and Elliot mold: wealth by screwing those closest to them. And the benefits quite often outweight risks.

What was an avg math or logic course like in 1941? (1)

metric10k (1815470) | about 7 months ago | (#45006279)

I really think a bigger factor is education and how long since they've been in education. Consider the worst cast in the study, a 90 year old. They (on average) graduated from high school 72 years ago in 1941. Statistics and probability curriculum probably wasn't what it is now, especially pre-Sputnick (1957). Not to mention the 72 to years spent not using those skills. That is, if you hypothetically had someone who was locked at 18 and didn't age, you would still expect them to forget those skills after 72 years. So in the end, I'm sure aging plays a factor, but I suspect other factors play a bigger role.

Does this jibe with peak finance = 53? (2)

istartedi (132515) | about 7 months ago | (#45006289)

I read about another study where they found financial ability peaked, on average, at 53. Before that you don't have enough experience. Then cognitive decline sets in. YMMV of course.

Correlation does not equal causation! (0)

Anonymous Coward | about 7 months ago | (#45006345)

Also all individuals always act rationally and in their own self interest, thus this study is invalid.

Slanted demographic? (1)

macraig (621737) | about 7 months ago | (#45006371)

So once again a behavioral study whose subjects all came only from developed First World nations, and likely only those whose first language was English? What could go wrong?

The old "economic rationality" fallacy (0)

Anonymous Coward | about 7 months ago | (#45006465)

How much is one's peace of mind worth? What is a "rational" depreciation factor? I would much rather have $10,000 now than $100,000 in ten years because I don't know if I'll still be around then, and if I am I will probably have inherited by then so I won't need the money. Whereas now it makes a huge difference whether I have to work for other people to earn money, or whether I'm free to do what matters to me. Go ahead, call me irrational.

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