The Wall Street Journal recently published an article that discussed the work of Jan-Emmanuel De Neve and James Fowler (London School of Economics and University of California, San Diego, researchers). De Neve and Fowler conducted a study that focused on finding a “debt gene” within certain people. The two researchers discovered that people who have one low MAOA gene and one high MAOA gene tend to have a larger amount of debt (8 to 16 percent more than most people).
The study included 2,000 participants aged 18 to 26. By studying each participant’s genetic information in conjunction with the amount of credit card debt that each individual had, researchers were able to discover that the MAOA gene had a direct impact on each person’s debt ratio. Of course, other factors (environmental, social) impact one’s debt, though the link between debt and genetics is the first of its kind.
For decades, researchers have been linking certain behavioural traits with various genes that people share, though the connection between behaviour and genes is difficult to pinpoint. What scientists have discovered about genes is that many personality traits are linked to genetics. While De Neve and Fowler told the Wall Street Journal that a true “debt gene” does not exit, what does exist in some people is an inherent set of genes that may heavily impact financial decisions.
Controlling Your Debt Gene
Trying to determine whether or not you have the so-called “debt gene” isn’t possible without a DNA analysis, though taking a good look at the spending habits of your parents might be a good idea. If you find that your financial habits are similar to habits that one or both of your parents has, simply recognizing this tendency could prevent you from falling into serious debt.
There’s still a lot for scientists to learn about genetics, but you can take your financial future into your own hands right now. In order to avoid falling prey to possible genetics, follow a few simple steps to avoid debt.
Don’t Carry a Balance: you’ve heard this one before, but carrying a credit card balance is the fastest way to sink into credit card debt.
- Don’t Buy Things You Can’t Afford: no matter how much of an available limit you have on your cards, resist the temptation to spend money that you don’t have.
- Use Cash Instead: while you need a credit card for some things (hotel rooms, airplane tickets), buying everyday items with cash may be a better idea.
- Ask for a Lower Limit: when your credit card company offers to raise your limit, ask for a lower limit instead. Companies love to give certain consumers who pay off debt more money, but you can stop this vicious cycle by refusing a credit increase.
- Start Paying Off Debt: if you’re already in debt (you may be able to blame your parents for this!), start paying off your debt as soon as possible. A small additional credit card payment each month is all it takes to wipe debt away.
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