New Study Reveals Findings About Excessive Optimism

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( – A new University of Bath Study that was published in Neuroscience News has determined that people who show excessive optimism tend to have lower cognitive abilities and often struggle with making decisions.

The abstract from the study notes that those with the highest cognitive ability tend to experience a 22 percent increase in the possibility of having a realistic view of the world, while they have a 34.8 percent reduction in optimism when compared to those with low cognitive abilities. The study also found that unrealistic optimism is also connected to “excessively risky behavior” and is often found in people who fail to exercise the necessary caution. These traits are felt more deeply when relating to financial issues. Those with excessive optimism were found to be more likely to make risky decisions and are more likely to make mistakes in the realm of investments and savings.

The University’s School of Management Dr. Chris Dawson pointed out regarding these results that unrealistic financial expectations can often lead to the accumulation of debt and be connected to high levels of consumption. According to the study, unrealistically optimistic people also have significantly lower chances of launching a successful business, with many optimists always believing that their business has a chance, while the business ends up failing.

As part of the survey, more than 36,000 households were surveyed regarding their expectations about their financial states. Those results were then compared to the financial outcomes of those same households. In the comparison, it was found that those who were extremely optimistic often had the worst results.

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