The Age of Reason: 53

[lswswein]

Interesting data on age and financial mistakes
-h

http://online.wsj.com/public/article/SB117448874386044127-cZF7cgZgbdIOAZg_lDsPBX2TBMo_20070329.html

Your Financial Savvy May Hit Its Peak at 53, Survey of Data Suggests

A quartet of economists think they have found an answer. In looking at which consumers get stuck paying those pesky credit-card fees, the economists noticed a puzzling pattern: Younger and older consumers were more likely than others to get hit with easily avoided fees. So the economists expanded their inquiry to loans and other products, and sifted through records of tens of thousands of consumers.

They found that middle-aged adults tend to borrow at lower interest rates and pay fewer fees than younger and older adults. The age at which consumers are least likely to make financial mistakes: a few months past their 53rd birthday, despite all the pressures that accompany middle age.

 

[crazy connie]

GREAT I turn 53 this fall!!! Does that mean i get to play victim in 2008 and beyond?@#$%^&*()

 

[lswswein]

GREAT I turn 53 this fall!!! Does that mean i get to play victim in 2008 and beyond?@#$%^&*()

No all that means is that you get to call bu**sh*it on all of us young ones and point to the study as proof

-h

 

[Sandy]

Could it be that ages 53 or so are peak earning years, so people have better cash flow, and don't need to borrow as much or use credit as much.

Those who are younger don't have $$ but have the pressures of families, homes, etc.

I wouldn't expect people to get savvy in their 50s and then forget it (dementia aside). But, for older folks, reduced income combined with unexpected expenses (health, taking in grandkids) could seriously harm finances and result in renewed reliance on credit.

 

[Running_Man]

Could it be that ages 53 or so are peak earning years, so people have better cash flow, and don't need to borrow as much or use credit as much.

Those who are younger don't have $$ but have the pressures of families, homes, etc.

I wouldn't expect people to get savvy in their 50s and then forget it (dementia aside). But, for older folks, reduced income combined with unexpected expenses (health, taking in grandkids) could seriously harm finances and result in renewed reliance on credit.

I think you have hit the nail on the head. Obviously someone isn't savvy at 53 and then unsavvy at 63, but circumstances create actions

 

[Mwsinron]

Wish I could find that report regarding people in their 50's the percent who suffer a life changing moment. IE divorce or sickness that hinders their ability to save for retirement. If I remember correctly it was something near a 50/50 chance.

 

[kcowan]

It just might be that these smart 53yo will move the bar up as they grow older. This could portend bad news for the finance industry. And subsequent tightening of free credit as a cost-saving measure.

 

[ziggy29]

They found that middle-aged adults tend to borrow at lower interest rates and pay fewer fees than younger and older adults. The age at which consumers are least likely to make financial mistakes: a few months past their 53rd birthday, despite all the pressures that accompany middle age.

I wonder why. It couldn't possibly have anything to do with being in the peak earning years, with kids moving out of the house, with the mortgage being paid off or with still being young enough to typically still be in pretty good health...