Can Financial Stress Make It Harder To Think?

See Financial Stress May Hit Your Brain and Wallet by SETH BORENSTEIN, AP Science Writer. Excerpts:

"People worrying about having enough money to pay their bills tend to lose temporarily the equivalent of 13 IQ points, scientists found when they gave intelligence tests to shoppers at a New Jersey mall and farmers in India.

The idea is that financial stress monopolizes thinking, making other calculations slower and more difficult, sort of like the effects of going without sleep for a night.

And this money-and-brain crunch applies, albeit to a smaller degree, to about 100 million Americans who face financial squeezes, say the team of economists and psychologists who wrote the study published in Friday's issue of the journal Science.

If you are always thinking about overdue bills, a mortgage or rent, or college loans, it takes away from your focus on other things. So being late on loans could end up costing you both interest points and IQ points, Mullainathan said.

The study used tests that studied various aspects of thinking including a traditional IQ test, getting the 13 IQ point drop, said study co-author Jiaying Zhao, a professor of psychology and sustainability at the University of British Columbia."