Variable Details

Available Studies

ROS, MAP, MARS, Clinical Core

Scaled? 

Not Scaled

Variable Type 

Longitudinal

Variable Name 

finfintot

Categories

Decision Making and Behavioral Economics

Financial decision making
Financial decision making ability - Sum of 6 items

Financial decision making ability is measured using a 6-item version of the Decision Making Competence Assessment Tool, created by Finucane. Participants view a module involving tables that provide financial information about mutual funds. The information provided in the module is designed to simulate materials used in financial settings in the real world.

Participants are then asked 6 questions of varying difficulty levels (3 simple and 3 complex) that assess comprehension and integration of the information in the tables. The complex problems parallel the simple problems but present information about many more options. The score for financial decision making ranges from 0 to 6 and represents the number of questions answered correctly. If 3 or more questions are missing, then the score cannot be calculated.

Participants are asked the following questions based on the provided tables:

  1. What is the account management fee for this fund?
  2. What is the gross annual return on the minimum investment?
  3. Suppose you want a mutual fund that has a management fee of less than 1% AND a gross annual return of over 6.5%. Based on the information in this table, which fund should you choose?
  4. What is the lowest available account management fee?
  5. Which mutual fund provides the best net rate of return, after subtracting management fees?
  6. Look at this table and suppose you have $2,000 to invest. You want a mutual fund that has a management fee of less than 1.5%, one that has been active for at least 5 years, and one that has a gross annual return of at least 6.0%. Based on the information in this table, which fund should you choose?

Note: In previous research, the decision making measure has been shown to have adequate psychometric properties including high inter-rater reliability and short-term temporal stability.


Publications