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Jul 7
Want $100 Now or $150 in one Year?

If I offered you $100 US  today or $150 Us dollars in 12 months, which would you take? Believe it or not – your  answer to that question may separate you into the truly intelligent, or land you into the not-so-smart-set among us. How so?
bag_of_money.png
Check out researchers Dohmen, Falk, Huffman, and Sunde’s findings from the University of Bonn and the Institute for the Study of Labour (Institut zur Zukunft der Arbeit, IZA) asked 1000 German adults to make the choice between 100 euros today or 150 euros in one year.

Simultaneously,  scientists measured mental abilities of each participant, using two different tests to show cognitive ability. The result?

They discovered that more intelligent people selected to wait for a higher return in one year, while less intelligent people requested their money now.

Interestingly, this is the
first reported research that shows the connections between intelligence and patience in financial decisions. In addition, it became obvious to researchers that a person’s willingness to take financial risks - also increased with higher intelligence.

What did you say your decision was about the $100 or $150 gift again…?


3 Comments/Trackbacks




I could not gain $50.00 in interest so I think waiting is the best option... :-)

Hey - Robyn- that's the smart answer. You didn't look at the end of the story before deciding did you:-)

These days -- we'd best take it when they give it me thinks! :-)Thanks for stopping by - research is fun when one can share it:-)

Hi Ellen, long time no comment :-)

I think this is a somewhat thin basis for deciding on intelligence. There are more perfectly good reasons for taking the money now (and I am not just rationalizing either).

How can I know what happens in a years time? A bird in the hand is better than...

I may actually be able to do better than adding 50% even if most people probably wouldn't

I may need it now and have little need for it later or may not even be able to enjoy it later.

Thats what I think of spontaneously, but I think that is all perfectly good reasons for taking the $100 today rather than waiting for the $150.

As for intelligent people being more risk willing do I think that is a matter of how you define risk. I would think that it is only true as long as it can be calculated somehow whereas they should be more risk adverse when the risk is impossible to judge.

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