However, Behavioral economic theory shows that people don't make rational decisions. What does influence behaviors around money? According to the paper in this month's Journal of Political Economy .it is in our genes. A new study of twins has found that people are genetically predisposed to save or spend the money they have, regardless of their wealth, sex or upbringing. One third of our behavior when it comes to money is explained by natural factors, rather than being someone's choice to consume or save earlier in life.
According to Barclays head of behavioral investment philosophy Greg Davies thinks there will be trouble on the horizon for many.