John Kiefer from AZ posted over 9 years ago:

Apparently the authors of this study didn't talk to Warren Buffet, age 82 or Charlie Munger, age 91. What about Carl Ichahn and Wilbur Ross, among others. This is a trite and stupid article. Obviously, anyone regardless of age who has "cognitve" impairment shouldn't be handling money.

Richard Erdos from PA posted over 9 years ago:

Sorry this is not a trite or stupid article. We only get to see what Warren Buffet wants us to see not the details. I worked with two sets of parents. In both cases each slipped in their ability to handle financial matters before it was really clear to family members. Sadly for my mother-law it cost her 80,000.

Milton from TX posted over 9 years ago:

During the early-1960s, my family had a very sad experience of this nature. A caregiver substantially looted the estate of an elderly female member of our family. The theft apparently went on over several years and none of the family had any suspicions. The theft only became apparent after her death when it came time to probate the estate. To my knowledge, this did not result from any estrangement within the family, only because of a Don't Ask-Don't Tell approach to dealing with one's elders. Since was quite young when this occurred, I never knew any details of the theft. Over subsequent years, I heard many expressions of sadness and regret that the family had failed to protect her from a predator within her own household. For whatever reason, the family did not elect to pursue this through the legal system. Hence, there was also considerable anger that the caregiver "got away with it."

Dave from CA posted over 9 years ago:

Cognitive aging is a real problem for a significant number of people, despite examples of others who remain mentally sharp their whole lifetime. Adding to that risk, an individual investor may not be self-aware of gradual cognitive impairment, and may imagine that he or she has more financial competence than is objectively the case. To guard against that risk, I give myself an annual objective test of my mental capacities: filing federal and state income tax returns without tax-preparation software or reliance on tax professionals. As long as I can interpret applicable income tax forms and instructions and complete tax returns that are nearly error-free, I trust my ability to manage my financial investments as well. If and when I fail that test, I intend to turn over my self-managed investment account to a trusted professional.

Richard H. (El Martillo) from Texas posted over 9 years ago:

Excellent article. For many of us, it highlights our most critical current challenge as investors. While each individual's degree of impairment may vary, we all share a vulnerability in our ability to reliably evaluate our own mental capacities. Kudos to Dave in CA for identifying his own annual objective test (the ability to prepare his own tax returns). We should all be so concerned and successful in finding our own signal flag.

Jeff from NY posted over 9 years ago:

The correct term is crystallized rather than "crystal" intelligence. It allows individuals to apply what they have already learned. Fluid intelligence allows learning new skills and methods. While some cognitive decline occurs in most older individuals, it is generally far less than once thought unless the individual develops dementia from Alzheimer's disease or one of many other causes. Significant declines in fluid intelligence are rare at age 30 except in cases of disease or brain injury and some people may retain usable fluid intelligence into old age. There is always a risk that declines in cognitive functioning, which often occur slowly, will go unrecognized and lead to poor decision making. That is why there are many scams that try to separate older individuals from their money.