Just because your mother has turned 85, you shouldn’t assume you’ll have to take over her financial matters. She may be just as good or better than you at making quick, sound, money-making decisions, according to researchers at Duke University.
“It’s not age, it’s cognition that makes the difference in decision-making,” said Scott Huettel, PhD, associate professor of psychology and neuroscience and director of the Duke Center for Neuroeconomic Studies. He recently led a laboratory study in which participants could gain or lose money based on their decisions.
“Once we accounted for cognitive abilities like memory and processing speed, age had nothing to do with predicting whether an individual would make the best economic decisions on the tasks we assigned,” Huettel said.
The study was published in the Psychology and Aging journal, published by the American Psychological Association.
Duke researchers assigned a variety of economic tasks that required different types of risky decisions, so that participants could gain or lose real money. They also tested subjects’ cognitive abilities -- including both how fast they could process new information and how well they could remember that information. They worked with 54 older adults between 66 and 76 years of age and 58 younger adults between 18 and 35 years of age.
The researchers used path analysis, a statistical method of finding cause-and-effect relationships, to determine whether age affected the economic decisions directly or whether it had indirect effects, such as age influencing memory, which in turn influenced decisions.
“The standard perspective is that age itself causes people to make more risky, lower-quality decisions -- independent of the cognitive changes associated with age,” said Huettel, who is also with the Duke-UNC Brain Imaging and Analysis Center. “But that isn’t what we found.”
The path analyses showed that age-related effects were apparently linked to individual differences in processing speed and memory. When those variables were included in the analysis, age was no longer a significant predictor of decision quality, Huettel said.
On a bell curve of performance, there was overlap between the younger and older groups. Many of the older subjects (aged 66 to 76) made similar decisions to many of the younger subjects (aged 18 to 35).
“The stereotype of all older adults becoming more risk-averse is simply wrong,” Huettel said.
Go to dukehealth.org's news section to read more about the study.