7 secrets to a richer retirement #6 Take losses in stride

Behavioral scientists have long known that people feel the pain of loss more pronounced than the joy of winning. They call this phenomenon of loss aversion. What they are just beginning to learn, however, is that retirees are usually much more loss averse than younger people.

How much more? Columbia University business professor Eric Johnson has recently conducted a study to find out. He gathered a group of people over 60 years of age and asked them if they would take the bet: You have 50% chance to win $ 100 and a 50% chance of losing $ 10.

Almost half the people who said they would refuse to play - which means that the heavy losses 10 times heavier than gains. Moreover, previous studies showed that the population as a whole tends to weigh the losses 2-3 times stronger than gains.

Investigators still are not certain why the loss of points aversion with age. As you age, you may feel you can not afford to have hits to your wallet, because you have fewer years ahead to do for them.

Another factor may be the effect of donation (see paragraph 5), which increases their desire to hold onto something that you already have. Whatever the cause, loss aversion is a problem if it leads you to invest too conservatively in their retirement years, carrying on the bonds, avoiding stocks. Its stock is more vulnerable to inflation that way.

Now put these findings into action:

Keep your financial knowledge
Research suggests that well-educated investors are less loss-averse than the average. It will continue to monitor news and advice on retirement money, or even enroll in a class of personal finance.

Fix your mix
Anthony Ogorek, a financial adviser in Williamsville, NY, recommends that by the time you spend 60 years of age having no more than 60% of its assets in stocks, You'll be less likely to freak out and run at 100% in cash next time the market tanks.

Get an outside perspective in their later years
This may mean investing some money in a fund's life cycle back to their age or using a money manager (accessible available today through many 401 (k) plans).