Old Aging

By Dian Vujovich

I’ve been known to complain about how today’s young people have little respect for their elders. They seem to look at people over say the ages of 60,70 and beyond as real dummies and don’t recognize the wisdom that all of those years of living has brought and taught them. Wisdom that that Gray Group is often willing to share and could wind up having a positive impact on a young person’s life.

But that sharing seems to fall on seriously deaf ears. And not the slightly deaf ears of grandma. Rather those of her grandson’s or granddaughter’s.

So as you might imagine, when I read about an aging and money paper that points out how past a certain age (one I’ve already gone beyond, BTW) our thinking isn’t necessarily too hot when it comes to money, I didn’t jump for joy.

The paper titled, “The Age of Reason: Financial Decisions over the Life-Cycle with Implications for Regulation,” is written by behavioral economics expert David Laibson. From a SmartMoney.com story about it comes the following:

“It may be depressing to think about, but a soon-to-be published paper on money and aging argues that while our experience and accumulated wisdom make us smarter for a while, this effect is ultimately swamped as our minds begin to decline with age. The tension between these two forces means that the sharpness of our financial decision making rises and then falls over the course of a lifetime, like an upside-down U. The authors of the paper even put a number on the peak of that upside down U: 53…”

What’s also depressing to think about is this sentence: “As the baby boom generation heads toward retirement, there will never have been so many people with so much accumulated wealth heading into such an extended period of cognitive decline.”

Unfortunately, there’s as much truth to that as there is in my opening paragraph.

But in addition to my point about wisdom, aging and experience does come the economic reality that growing old in America today isn’t pretty for those living without a huge bundle of accumulated wealth or a strong family and/or the solid support of friends.

Some of the worst news I’ve heard over the past month came from a Brian Williams evening news report. In it he pointed out that 50 percent of children born today in non-third world nations will live to the age of 100.

Given how expensive it is to live a life now, how quickly families are to break up, how we shun the poor, weak and suffering or those who haven’t climbed the financial ladder of success, living to the ripe old age of 100 could be a curse or a blessing depending upon one’s circumstances. Knowing that most who do won’t have all of their marbles doesn’t make the scenario any brighter.

On a happier note, you’ll find some suggestions for managing wealth as you age by reading the full SmartMoney.com story at http://tinyurl.com/y9vyl2r . Don’t want to read the story, here’s the takeaway: Keep things simple.

And that’s good investing advice no matter what your age.