Despite declines in financial ability with age and dementia, research has not explored older adults’ metacognitive awareness of such declines. We investigated the relationship between subjective and objective financial abilities among older adults, and how this relationship changed over 10 years and with cognitive decline.
Data from older adults (N = 2,802) in the Advanced Cognitive Training for Independent and Vital Elderly study were used to assess subjective financial performance from the Minimum Data Set for Home Care and objective financial performance from the Everyday Problem Solving Test and the Observed Tasks of Daily Living. Multilevel modeling tested associations between subjective and objective performance and moderating factors.
In years when older adults subjectively reported fewer difficulties with their finances, they objectively performed better at financial tasks and this relationship became stronger over 10 years. This relationship was not present for older adults with a dementia diagnosis. Age and objective cognitive impairment did not moderate the relationships.
Awareness of financial abilities is critical in an aging population bombarded by fraud and scams. Although older adults without dementia are metacognitively aware of their financial abilities, those diagnosed with dementia are more likely to experience financial anosognosia. These findings offer new insights for programs and early detection tools for dementia.