Dorien Bangma

40 | CHAPTER 3 knowledge and experience might, therefore, compensate for a decreased deliberative cognitive processing in older adults resulting in similar or even better decision-making with advancing age (Mather & Knight, 2005; Meyer et al., 1995). It can thus be concluded that normal aging may have negative effects as well as positive influences on (financial) decision-making. So far, only a few studies focused on FDM. These studies primarily examined an older (demented) population and investigated relatively basic aspects of FDM, such as the ability to recognize coins, count money and pay bills (e.g., Kershaw & Webber, 2008; Loewenstein et al., 1989; Marson et al., 2000). FDM, however, also includes buying or selling property, saving for retirement and taking out health insurances. Furthermore, unfitting behavior in a financial context, such as impulsive buying and gambling, can lead to major consequences for an individual’s financial situation. Therefore, to gain a comprehensive overview of an individual’s FDM skills and abilities it is of utmost importance to not only assesses the simple aspects of FDM but also to study more complex aspects of FDM. The aim of the present explorative study is to determine the effects of normal aging on multiple aspects of FDM. Therefore, based on previously published procedures, a test battery was developed encompassing eight FDM tests measuring eight aspects of FDM (i.e., financial competence, (financial) decision-making capacity, financial decision styles, ability to apply rules, decisions with implications for the future, impulsive buying tendency, emotional decision-making and intuitive and deliberative decision-making). It is expected that an advancing age results in a decreased performance in aspects of FDM that rely strongly on deliberative information processing (e.g., the ability to apply rules) due to an age-related cognitive decline that accompanies normal aging (Braver &West, 2008; Denburg & Hedgcock, 2015; Salthouse, 1996; Salthouse & Meinz, 1995). However, it is also expected that other aspects of FDM, that rely more on knowledge or affective processing, are not affected by aging (e.g., financial competence) or even improve with advancing age (e.g., impulsive buying or intuitive decisions) due to an age-related increase in knowledge and experience with FDM or an improved affective decision-making in older adults (Hess, 2015; Li et al., 2004; Mikels et al., 2013; Peters et al., 2007). Furthermore, since this is an explorative study, it is important to determine whether or not our results are due to statistical errors and can be replicated. Therefore, the validity of the prediction models will be examined by internal validation (i.e., bootstrap resampling procedure) as well as external validation on another, independent, sample of participants. Finally, the association between cognitive functions and the different aspects of FDM and the possible mediating effect of cognition on the relation between age and FDM are investigated. Materials and Methods Participants – sample 1 One hundred and ninety-one adults participated in this study. Participants were recruited through advertisement in a local newspaper and via social contacts of the researchers (i.e., family members and acquaintances of the researchers and of included participants were