A stream of recent research has suggested that financial concerns can also tax your mind and prevent you from thinking clearly. But that may be too sweeping a conclusion, according to Junhua Dang of Lund University and his colleagues in Sweden and China. Their study, published in the Scandinavian Journal of Psychology, suggests having money problems on the mind doesn’t always impair cognitive ability. In fact, it can even enhance it.
The prior studies had shown worse performance on intelligence tests by poorer participants when they were asked to think about financial issues beforehand, because of how these issues loaded their “working memory” – their ability to hold and process information over short time periods – thus hindering the mental manipulations the tests required. But working memory isn’t key to all cognitive work, so Dang’s team set out to see if other kinds of mental tasks would be unaffected by monetary angst. The participants performed a categorisation task, some of them after being prompted to think about their financial woes.
Those who were reminded of their money worries, and those with below-average family income (relative to the other participants), performed better on the task, being quicker to meet the success criteria of eight correct categorisations in a row. This relates to a wider point that Dang makes in a commentary on the previous research, which is that although stress is unwelcome, it does have a function, which is to narrow our focus “away from irrelevant tasks (which IQ tests arguably are) toward relevant tasks (which financial decision making arguably is).”
Source material from BPS Research Digest