Human behavior may not belogical at times, but it can be predictable, even in areas ofspending, saving and investing. (Photo: Shutterstock)

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It's not exactly in your genes, but according to a new studyfrom DNA Behavior International, behavioral patterns can shedlight on the reasons behind investors' spending, savingand goal-setting actions.

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“An investor's decisions and actions may sometimes seem likewild cards,” Hugh Massie, CEO of DNA Behavior International, isquoted saying, “but the truth is that with each decision, goal oremotion, their behavior is predictable.”

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Massie adds, “We call this a person's financial DNA. And bylearning and leveraging that, we can improve and accelerate theresults clients achieve with their financial advisors.”

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From a cohort composed of 50 percent men and 50 percent women,from 19 to 87 years of age and with incomes ranging from $18,000 to$589,000, the study (illustrated in a video ) resulted in over 60 insightsinto people's financial behavior.

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DNA Behavior identified four different types ofspenders/investors. It christened the two top spending groups as“influencers” and “initiators,” and found that they seekout experiences and are more goal-driven than others in the study.Topping their discretionary spending is dining out.

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In contrast, “stylish thinkers” are among the lowest spenders,dropping an average of 30 percent less than the top two groups.

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The study found that higher risk-takers live in more affluentneighborhoods; they also borrow more for homes, while lowerrisk-takers have more equity in their homes.  And whilehigher-risk groups earn more on average, the top earners in theabsolute are in the lower middle range of risk-takers.

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By applying its assessment tool in the aggregate instead ofindividually, to identify risk profile, behavioral biases, spendingpatterns and goals-based planning preferences, thestudy aimed to help financial advisors, wealth managersand other financial professionals identify the clients who needattention, as well as how and when to provide that attention. Thatin turn enables them to accelerate their own performance as well asthat of client portfolios.

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Massie says in a statement, “Using validated methodology toidentify things like how likely a client is to delegate financialplanning, how likely a client is to save/spend, how a clientsets/pursues goals, and how emotional will a client become, forinstance, in the face of market upswings and downswings, wecontinue to demonstrate that advisors and their clients can bestprotect and build wealth through the added edge of this deeperinformation.”

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READ MORE:

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Retirement's future could rest with digital tools,behavioral economics

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How behavioral finance can improve plan health& outcomes for participants

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Godfather of auto-enrollment says reducing 401(k)deferrals 'massively progressive'

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Marlene Satter

Marlene Y. Satter has worked in and written about the financial industry for decades.