Instrumental and disinhibited financial risk taking: Personality and behavioural correlates

Risk taking, including that within the financial domain, is often considered to represent a unidimensional personality trait. This paper considers the relatively unexplored construct of instrumental financial risk taking: a class of behaviours that while inherently risky, are entered into with a greater degree of consideration than more impulsive or disinhibited forms of risk taking. Participants (N = 1043) completed a novel questionnaire assessing instrumental and disinhibited financial risk taking as part of a battery including measures of: sensation-seeking, impulsivity, psychopathic personality traits and real life financial outcomes. Correlations revealed a divergent pattern of relationships supporting the utility of characterising these different forms of financial risk. Scores on the novel instrument are shown to explain more than 10% of the variance in the use of riskier, more productive savings products, over and above the influence of demographics and financial status.