dinsdag 28 april 2015

As Cognition Slips, Financial Skills Are Often the First to Go

An interesting article in the NY Times: As Cognition Slips, Financial Skills Are Often the First to Go. When Helen Clark brought her father-in-law, then 83, to the doctor last year, she knew his mind was slowing, but a mental status exam confirmed it. He knew the year, where he lived and the name of the president. But when the doctor asked him to count backward from 100, subtracting seven from each number — 100, 93, 86, 79 — a look of confusion washed over his face. Studies show that the ability to perform simple math problems, as well as handling financial matters, are typically one of the first set of skills to decline in diseases of the mind, like Alzheimer’s [...] The signs, while perhaps not surprising, are subtle, making them easy to miss: It may become more difficult for people to identify the risks in a particular investment, and they may focus too much on the benefits. Completing various tasks on a financial to-do list may start to take longer, such as preparing bills for the mail. Everyday math may become more laborious or prone to errors, whether that’s figuring out a tip in a restaurant or doing a calculation that requires two steps. Financial concepts, like medical deductibles and minimum balances required in savings accounts, may also become harder to grasp. Naturally, these behaviors should represent a significant change: If a person was never adept with personal finances, this won’t serve as much of an indicator. [...] He said he wishes all 65-year-olds would start by simplifying their financial lives, reducing the money clutter to just a few mutual funds at a reputable institution.

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