Saturday, 20 February 2010

What’s the length of your fingers got to do with your money?

Hold your hand out, palm facing towards you.

Now compare the length of your index finger and your ring finger. Which is longer?

In men the ring finger is usually longer.
In women they’re usually about the same length.

Scientists say the amount of testosterone we’re exposed to in the womb affects the growth of the ring finger. So the male has a larger ring finger.

But, of course, females get exposed to testosterone too and some have a longer ring finger (I’m one of those).

(Psychologists are a weeny bit obsessed with fingers at the moment - a colleague of mine literally whooped with joy when his finger-measuring callipers arrived in the post).

Now researchers from the USA* have found that females who have a more male-like finger ratio (a longer ring finger, called the 2D:4D ratio) are more likely to be financially impulsive.

They tested delay-discounting ability in men and women.

Delay discounting is opting for a smaller reward now rather than waiting for a larger reward.

So for example, you might prefer £10 now to £11 next month.

But would you turn down £10 now in favour of £100 next month?

Most people would. Where they differ is in the ‘tipping point’ at which they switch from taking the reward now to opting to wait (in the example above, somewhere between £11 and £100). This is known as the k value.

The psychologist Mischel first tested delaying gratification with children, offering them one marshmallow now or two if they could wait 5 minutes. Some kids just couldn’t wait. They wanted their gratification instantly.

Money decisions can be the same. Lots of us would rather spend our money now than put it away to earn interest. Even though the delay would stash us more cash in the long run. Delay discounting is what separates spenders from savers. And this new research suggests, in women, a sneaky look at the ring finger might be very revealing.

*Lucas, M. & Koff, E. (2010) Delay discounting is associated with the 2D:4D ratio in women but not men. Personality and Individual Differences, 48, 2, 182-186.

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