Financial intelligence peaks at 53
This study, published at the National Bureau of Economic Research, has been written about in several news accounts. It just crossed my desk.The sophistication of financial decisions varies with age: middle-aged adults borrow at lower interest rates and pay fewer fees compared to both younger and older adults. We document this pattern in ten financial markets... The sophistication of financial choices peaks around age 53 in our cross-sectional data.
Performance tends to rise and then fall with age. Baseball players peak in their late 20s (James 2003). Mathematicians, theoretical physicists and lyric poets make their most important contributions around age 30 (Simonton 1988). Chess players achieve their highest rankng in their mid-30s (Charness and Bosnian 1990). Autocratic rulers are maximally effective in their early 40s (Simonton 1988). Authors write their most influential novels around age 50 (Simonton 1988). The present paper studies an activity that is less august, though it is relevant to the entire adult population: personal financial decision making.