1. Exploring the Relationship Between
Financial and Non-Financial Risk-Taking Behaviors
Diann Moorman, Leslie Gordon-Simons, Martin Seay
University of Georgia
Background Table 2.
Frequently financial behavior is measured by determining the level of risk Predicting Likelihood of Exhibiting Financially Risky Behavior
inherent within an action. Conventional wisdom has indicated that “general” Data and Methods Characteristic Odds-Ratio P-value
risk tolerance is a poor predictor of financial risk tolerance. However, Data: Intercept 0.433
evidence suggests that some individuals may actively seek multiple types of 312 undergraduate students from a southeastern research university were Sex
risks while other individuals seek to avoid as much risk as possible surveyed in an introductory level course during the spring and fall semesters of
(Zuckerman & Kuhlman, 2000). The college years in particular, are generally Male 0.501 0.018
2009. Female - -
associated with a multitude of risky behaviors including “binge drinking”
(Douglas, et al., 1997), gambling (Huang & Boyer, 2007), and sexual Race
Measures:
experimentation (Martins, Tavares, da Silva Lobi, Galetti & Gentil, 2004). White 0.565 0.13
Responses to a series of questions were used to create three indices. In order to
This research explores the connections between multiple risk taking behaviors Other - -
differentiate between above and below average levels of risk taking behavior,
of college students including sexual risk-taking (e.g. having multiple partners), Family Income
indices were transformed into dichotomous variables utilizing means as cut
alcohol risk-taking (e.g. consuming 4 or more drinks at one sitting), and Less than $60,000 - -
offs. Each index was created using the following questions:
financial risk-taking (e.g. paying only the minimum credit card payment). It $60,001 to $90,000 1.212 0.685
seeks to ascertain whether a consistent risk profile is exhibited in all three $90,001 to $130,000 0.801 0.624
•Risky Financial Behavior: How often do you --pay only minimum
arenas. There is growing evidence that financial problems among U.S. $130,000 plus 0.654 0.341
payments on credit cards, pay finance charges on your credit card, buy items
consumers begins during early adulthood (McKenna, Hyllegard, & Linder, Relationship Status
on impulse, borrow money from family/friends, receive collection calls,
2003), quite possibly during the more risky college years. Committed relationship - -
bounce checks, buy things you can’t afford;
Other 0.859 0.537
Research Questions •Risky Sexual Behavior: How old were you when you first had sex, with Employment Status
•Do individuals demonstrate consistent risk-taking tendencies across how many partners have you had sex, it is acceptable to have sex with Employed 1.807 0.021
differing types of risks? casual dating partners the first night, in an exclusive relationship it is ok to Not Employed - -
•Is risky behavior as related to sexual and alcohol related activities have sex with a different person, one night stands are enjoyable, it is ok to Sexually Risky
associated with unfavorable financial behavior? have sexual relationships with multiple people at the same time; More risky 2.064 0.013
Less risky - -
•Risky Drinking Behavior: How often do you drink more than 4 drinks in a Alcohol Risky
Table 1. single night, drive drunk, appear in public intoxicated, drink alcoholic More risky 1.199 0.491
Sample Description beverages during a typical month, get very intoxicated, get mildly Less risky - -
Characteristic % of Sample intoxicated
Sex Conclusion
Analysis: This study sought to explore whether individuals a consistent risk-taking
Male 30.8%
A binary logistic regression analysis was conducted to predict the likelihood of profile across multiple types of behaviors. Results indicate that individuals
Female 69.2%
exhibiting above average financially risky behavior based upon whether a who exhibited sexually risky behavior were found to be more likely to
Race
respondent exhibited above average alcohol related risky behavior and exhibit financially risky behavior, but no correlation was found between
White 85.9% alcohol related behavior and financially risky behavior. These mixed results
sexually risky behavior, controlling for gender, race, family income,
Other 14.1% relationship status, and employment status. leave room for further exploration and clarification. It is important to note
Family Income that the generalizability of this study is limited both by its population and by
Less than $60,000 10.3% the convenience sampling techniques that were employed in data collection.
$60,001 to $90,000 21.5% Results
$90,001 to $130,000 29.8%
•Participation in sexually risky behavior was found to be positively
References
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Relationship Status correlated with participation in financially risky behavior. (1997). Results from the 1995 National College health risk behavior survey. Journal of
Committed relationship 42.9% •Individual’s who exhibited risky behavior in sexual activities were American College Health, 46, 55-66.
Other 57.1% 2.06 times as likely to exhibit financially risky behaviors. Huang, J. H., & Boyer, R. (2007). Epidemiology of youth gambling problems in
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•Participation in risky alcohol related behavior was not found to be Martins, S. S., Taveres, H., da Silva Lobo, D. S., Galetti, A.M., & Gentil, V. (2004).
Employed 39.1% Pathological gambling, gender, risk-taking behaviors. Addictive Behaviors, 29,, 1231-
significantly correlated with participation in financially risky behavior.
Not Employed 60.9% 1235.
McKenna, J., Hyllegard, K., & Linder, R. (2003). Linking psychological type to
financial decision-making. Journal of Financial Counseling and Planning, 14, 19-29