We know that younger drivers are more likely to get in accident than drivers in their forties. This probably is due to a combination of factors -- a lack of experience plays a role, but also teenagers tend to process situations and evaluate risk differently than their older counterparts.
Is the same true for investing? Money's Jason Zweig looks at the ways that senior citizens are likely to differ from younger investors: "New research by finance professor Alok Kumar shows that the average investor exhibits an 'abrupt and significant drop in performance around the age of 70,' probably because of fading memory and rising impulsiveness."
It turns out that older investors may actually be less risk-averse, and more willing to gamble, than their younger counterparts. Combine this with the tendency for memory problems and less agile mental processing in the later years, and you have a group of people who are extremely vulnerable to hucksters and charlatans selling life insurance, stocks, or business opportunities.
If you are concerned about your aging parents being targeted by con artists, check out Fraud.org's page on elder fraud and the Consumer Action's Elder Fraud Leader's Guide.
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Reader Comments (Page 1 of 1)
11-05-2007 @ 10:15PM
Roger Waugh said...
Well great thoughts about elders but I totaly disagree with your ,one large difference elders don't flap their jaws like the younger bunch and you can bet they have more in investments then the younger group.But then again I would agree about the fraud sites on the internet as of today but a consumer group and a hand full of Senators will change just enough to take care of our seniors in the future so my word of advice call your broker and stay clear of the criminals posting on the internet and web sites....