Financial Risk Aversion Among Older Black and White Adults

S Duke Han, Lisa L Barnes, Sue Leurgans, Lei Yu, Melissa Lamar, Crystal M Glover, David A Bennett, Patricia A Boyle and Anne Krendl

The Journals of Gerontology: Series B, 2024, vol. 79, issue 2, 3-9

Abstract: ObjectivesRisk aversion has a substantial impact on decision making and is associated with key demographic characteristics. However, few studies have investigated whether risk aversion varies by race.MethodsWe investigated racial differences in financial risk aversion in 684 older Black and White adults without dementia in the Minority Aging Research Study and Rush Memory and Aging Project matched for age, education, sex, and cognition using Mahalanobis distance. We also investigated whether select contextual factors (self-reported discrimination, socioeconomic status, and literacy) mediated or affective factors (trust, loneliness, and neuroticism) moderated any observed racial differences.ResultsIn regression models adjusted for age, education, sex, and cognitive function, older Black adults were more risk averse than older White adults (Beta = 0.1264, standard error = 0.0227, p value ≤ .00001). None of the contextual or affective factors mediated or moderated this association.DiscussionOlder Black adults are more financially risk averse than older White adults. Because risk aversion may be associated with important financial and health outcomes in older age, more research is needed to investigate the reasons for this difference.

Keywords: Disparities; Gamma; Race; Risk aversion (search for similar items in EconPapers)
Date: 2024
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The Journals of Gerontology: Series B is currently edited by Psychological Sciences - S. Duke Han, PhD and Social Sciences - Jessica A Kelley, PhD, FGSA

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