This study explores the links between culture and risk tolerance, based on surveys conducted in 23 countries. Altogether, more than 4,000 individuals participated in the surveys.Risk tolerance is associated with culture. Risk tolerance is relatively low in countries where uncertainty avoidance...

Typical risk questionnaires aimed at helping advisors guide investors are deficient in five ways. First, each investor has a multitude of risk tolerances, one for each goal and its mental account. Probes for one global risk tolerance miss that multitude. Second, the links between answers to...

Financial well-being is distinct from income. Some people with high incomes suffer low financial well-being, as their incomes fall short of their aspirations. Such people feel propelled to reach their aspirations by taking risk and willing to bear losses. Conversely, some people with low incomes...

The crisis of 2008 and 2009 exposed not only the shortcomings of our financial system but also the shortcomings of the tools used by financial advisors to assess and guide investors. These include risk questionnaires. Many investors who were assessed as risk tolerant in 2007 and assigned...