Cognition and the Housing Behavior of Older Americans

Title: Cognition and the Housing Behavior of Older Americans

Date: 3/23/2016

Author(s): Englehardt

Executive Summary:

America is aging. As the Baby Boom begins to enter retirement years, new challenges are arising with significant implications for both borrowers and lenders. In particular, given the impact of aging on memory and other cognitive skills, there is a need to consider the implication for financial decisions made by older individuals. By the time individuals are arriving into traditional retirement ages, when many important financial decisions are made, cognitive skills are already in decline as part of normal cognitive aging. This report finds a strong correlation between housing behavior and the cognitive decline of older Americans. Importantly, normal cognitive aging also correlates to a potential borrower's ability to make decisions relating to their own housing and financial situation.