Money Management Difficulties and Older People: Detection of Early-stage Dementia in Financial Data

48 Pages Posted: 8 Apr 2024 Last revised: 24 May 2024

See all articles by Shivam Agarwal

Shivam Agarwal

National University of Ireland, Maynooth (NUI Maynooth) - School of Business

Cal B. Muckley

University College Dublin

Date Written: May 24, 2024

Abstract

The years before a dementia diagnosis may be an acutely vulnerable period for individuals, leading to poor financial decisions. Financial institutions have a duty of care to protect their customers in vulnerable circumstances. We test if older persons' incipient money management difficulties can help identify vulnerable individuals with early-stage dementia. We show that clinically informed lead indicators of dementia, extended to include money management difficulties, can inform a high-performance AI model to predict a clinical diagnosis. Invariant to extensive robustness tests, after age, money management difficulties is consistently ranked the most important lead indicator of dementia. Financial institutions can use this data to enhance their protection of customers with dementia, and to inform the inter-generational transfer of financial control to a reliable agent.

Note:

Funding Information: Cal Muckley is grateful for support provided by the VAR consortium, Science Foundation Ireland and an Operational Risk industry consorium comprising: Bank of Ireland, Citibank Europe Plc, Deloitte Ireland and Institute of Banking. Shivam Agarwal also gratefully acknowledges support of a generous UCD Business School Doctoral Scholarship. Cal Muckley would like to acknowledge the financial support of Science Foundation Ireland under Grant Numbers 16/SPP/3347 and 17/SP/5447 and funding from the ADAPT Centre for Digital Content Technology, funded under the Science Foundation Ireland Research Centres Programme (Grant 13/RC/2106 P2), and co-funded by the European Regional Development Fund.

Conflict of Interests: We have no competing interests to declare.

Keywords: Financial services, Household finance, Aging, Cognitive decline, Money management difficulty, Vulnerable customers, Machine learning, Explainable AI

JEL Classification: G51, G53, I18, J14, J26

Suggested Citation

Agarwal, Shivam and Muckley, Cal B., Money Management Difficulties and Older People: Detection of Early-stage Dementia in Financial Data (May 24, 2024). Available at SSRN: https://ssrn.com/abstract=4785764 or http://dx.doi.org/10.2139/ssrn.4785764

Shivam Agarwal

National University of Ireland, Maynooth (NUI Maynooth) - School of Business ( email )

Cal B. Muckley (Contact Author)

University College Dublin ( email )

Blackrock, Co. Dublin
Ireland
+353-1-716-8091 (Phone)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
184
Abstract Views
786
Rank
304,842
PlumX Metrics