A recent study has uncovered a striking connection between cognitive ability and the tendency to have unrealistic financial expectations. The findings, published in Personality and Social Psychology Bulletin, provide evidence that individuals with higher cognitive abilities tend to have more realistic, or even pessimistic, views about their financial future.
  • swiftcasty@kbin.social
    2·
    9 months ago

    Dawson found that individuals with higher cognitive abilities were less likely to fall into “extreme optimism” about their financial futures. In contrast, they were more likely to have realistic or even pessimistic expectations. For example, those with cognitive abilities two standard deviations below the mean exhibited a higher probability of “extreme optimism” compared to those two standard deviations above the mean.