Study Questions Link Between Childhood Poverty and Risky Financial Behavior

Study Questions Link Between Childhood Poverty and Risky Financial Behavior
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A new study has cast doubt on the strength of the link between growing up in poverty and taking financial risks when faced with reminders of death. Published in the Journal of Experimental Psychology: Applied, the research aimed to replicate a 2011 study that claimed childhood poverty leads to riskier and more impulsive financial decisions under mortality salience.

Led by Joe Gladstone from the University of Colorado Boulder’s Leeds School of Business, the study used a significantly larger and more diverse sample—over 1,000 U.S. adults compared to the original study’s 71 university students. Participants were randomly assigned to read either a death-related or neutral article before completing decision-making tasks measuring financial risk-taking and time preference.

The researchers found a statistically significant but minimal link between mortality cues and increased financial risk-taking among those from lower-income childhood backgrounds. The effect was so small—less than one additional risky choice on a seven-item scale—that its practical relevance was questioned.

Unlike the original study, no connection was found between mortality reminders and impulsive decision-making. However, younger participants showed a slight tendency toward preferring immediate rewards, partially aligning with the earlier findings.

The study, which was preregistered and publicly shared for transparency, suggests that life history theory may have limited application in predicting individual financial behavior. The authors argue that factors such as current financial status and psychological traits may play a more significant role.