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Financial risk-taking higher in those who feel excluded, study claims
January 16, 2013
Research has revealed a person may be more inclined to take a financial risk when they feel socially excluded
When people feel isolated from the rest of society, they are more open to taking financial risks.
That is according to a study published in the Journal of Consumer Research, which identified a pattern in people's spending habits when they feel rejected.
In one test, research participants were asked to think of a social situation in which they felt excluded or included, and were then asked to choose between high-odds/low-reward and low-reward/high-odds gambling options.
As such, the absence of social support, or feeling included, led people to seek and value money as an alternative means to secure what they wanted from society, the study claimed.
The research team involved in the study said that "feeling socially rejected triggers riskier financial decision-making", suggesting that important money matters should not be discussed straight after a breakup or argument with friends and family.
As the authors suggest, it is important to understand how social vulnerability can influence a person's ability to balance risk and financial rewards in terms of savings, insurance and investments.
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