Seniors at high risk around financial decisions
Financial elder abuse, life savings lost through shonky investments – older people are high risk because they have more money just before retirement, on average, than at any other stage in their lives.
QUT Business School PhD researcher Sylvain Hohn is investigating how older people make financial decisions and their preparedness for the potential financial risk posed by age-related cognitive decline.
“Financial decision-making is crucial for financial well-being and as we grow older, these decisions become even more vital,” Mr Hohn said.
“It is not yet well understood how factors such as health, socio-demographics, and wealth influence peoples' financial decision-making.
“Making financial decisions is difficult at any age. If we lose all our assets such as car, stocks, real estate, and savings as a young adult it will have a big impact for a few years but there are still many more years in employment to make up for it.
“After retirement, however, financial mistakes have a much more severe impact. Starting full-time work again is the last thing we want to do, and that’s if we can get back into the workforce.”
Mr Hohn is seeking couples aged 60 to 89 in Brisbane to assist his research.
“Some financial advice may take advantage of older people, so we want to understand whether they talk to family members and friends to check on some of the advice they get,” he said.
“We hope to shed a light on which factors, including age and cognitive functioning, contribute to good financial decision-making.
“The purpose of this research is to inform policymakers and advocacy groups on ways to improve existing rules for delegated decision-making, and to adapt the regulations on marketing of financial products to older consumers.”
17 March 2018.