Housing Finance Policy Center
Lunchtime Data Talk
Federal Reserve Surveys of the Economic WellBeing of US Households: SCF and SHED
Dave Buchholz, Federal Reserve Board- Division of Consumer and
Community Affairs
Jeff Larrimore, Federal Reserve Board- Division of Consumer and
Community Affairs
Jeff Thompson, Federal Reserve Board- Division of Research and Statistics
January 21, 2016
A Overview of the Survey of
Consumer Finances
January 21, 2016
The analysis and conclusions set forth are those of the authors and do not indicate concurrence by
other members of the research staff or the Board of Governors of the Federal Reserve System.
Overview
• Overview of the Survey of Consumer Finances (SCF)
• Recap of main findings from 2013
• 2016 SCF Redesign Highlights
• The Racial Wealth Gap – Highlights of Recent
Research
3
SCF Background
• Survey of households sponsored by the Federal Reserve
Board
• In cooperation with Department of Treasury
• Survey contractor = NORC since 1992
• SCF triennial cross-sectional surveys, 1983-2013
• Consistent Methodology since 1989
• Sample sizes 4,000 to 6,500
• SCF panel surveys in 1983-1989 and 2007-2009
• Survey design
•
•
•
•
Area probability and List samples
In person or phone interview using CAPI
Sample weights for population estimates
Missing values and multiple imputation
4
Survey content
• Collects information on:
•
•
•
•
•
•
Assets and liabilities
Relationships with financial institutions
Employment and Pensions
Income
Demographics
Attitudinal questions
• Most data collect at the household level
• Employment, pensions, demographics for head and
spouse/partner
5
Household Balance Sheet
• Assets
• Financial assets
•
•
•
•
•
•
Transaction accounts
CDs
Stocks and bonds
Mutual funds
Retirement accounts
Trusts and annuities
• Nonfinancial assets
• Liabilities
• Mortgages
• Installment loans
• Car loans
• Student loans
• Other loans
• Credit card balances
• Lines of credit
• Vehicles
• Houses / other property
• Businesses
6
Main results
• Income gains over 2010-13 very limited
• Wealth levels stabilized over 2010-13, with small
gains for some
• Increased concentration of income and wealth
• Ownership of retirement accounts and equities
declined for most groups over 2010-13; mean
values increased
• Homeownership rates fell for most groups over
2010-13; mean net housing wealth stabilized
7
Main results
• Business ownership rates fell for most groups over
2010-13, some increases in the mean value of
business equity
• Education debt continued to increase over 201013. The majority of debt is held by higher income
families or families with a college degree
• Payment to income ratios continued to decline, and
fewer families had high ratios
• Credit conditions are still an issue for many
families, some improvement in fraction with late
payments
8
The evolution of family income
100
Thousands of 2013 $
90
80
70
60
50
Mean Income
90% gap
60% gap
Median Income
40
30
1989
1992
1995
1998
Shaded areas indicate recessions
2001
Year
2004
2007
2010
2013
9
Income recovers at the top
15%
2007-10 Change
2010-13 Change
10%
Percent
5%
0%
-5%
-10%
-15%
-20%
Bottom 50
Next 40
Top 10
($27,000)
($85,000)
($398,000)
Usual income group
(2013 Mean)
10
Trend in Top Income Shares
11
The evolution of family wealth
660
Thousands of 2013 $
560
460
360
Mean Wealth
660% gap
260
400% gap
160
60
1989
Median Wealth
1992
1995
1998
Shaded areas indicate recessions
2001
Year
2004
2007
2010
2013
12
Continued wealth declines for low
incomes, little recovery at the top
2007-10 Change
5%
2010-13 Change
0%
Percent
-5%
-10%
-15%
-20%
-25%
Bottom 50
Next 40
Top 10
($99,000)
($381,000)
($3.3 Million)
Usual income group
(2013 Mean)
13
Sources of wealth changes,
2010-13
Usual Income Group
Balance Sheet Item
Bottom 50
Next 40
Top 10
-15%
-3%
-2%
(Less) Mortgages
5%
3%
1%
Business Plus Corporate Equity
-5%
2%
4%
Other Assets
-1%
-1%
-1%
(Less) Non-Mortgage Debt
0%
0%
0%
-15%
2%
2%
Housing
Total
14
Trend in Top Wealth Shares
15
SCF Missing Some of the Wealth Gains?
• Financial Accounts (FA) aggregates show stronger
gains in household sector net worth
o FA (‘10 Q1 to ‘13 Q1) +21% aggregate nominal
o SCF shows about +12% for 2010-2013
• SCF respondents may not have fully built in
recovery in housing and stock prices
o National house price indexes disagree on timing
o Some correction for prior survey over-valuations?
• Also, continued strong growth since survey
16
2013
SCF
Field
Period
SCF
Average
House=
$316K
(nominal)
SCF
Average
House=
$319K
(nominal)
17
2014-04-01
2010
SCF
Field
Period
2014-01-01
2013-10-01
2013-07-01
2013-04-01
2013-01-01
2012-10-01
2012-07-01
2012-04-01
2012-01-01
2011-10-01
2011-07-01
2011-04-01
2011-01-01
2010-10-01
FHFA
Case-Shiller
CoreLogic
2010-07-01
2010-04-01
2010-01-01
2009-10-01
2009-07-01
2009-04-01
250
2009-01-01
275
2008-10-01
2008-07-01
2008-04-01
2008-01-01
2007-10-01
2007-07-01
2007-04-01
2007-01-01
2006-10-01
2006-07-01
2006-04-01
2006-01-01
2005-10-01
2005-07-01
2005-04-01
2005-01-01
2004-10-01
175
2004-07-01
2004-04-01
2004-01-01
Index 1989 Q1 = 100
FHFA, Case-Shiller, and CoreLogic Nominal House Price Indexes and SCF House Values
300
$339K
(2013 $)
225
200
The small nominal change in SCF average house values between
2010 and 2013 is in line with FHFA, and below the increase reported
by Case-Shiller and CoreLogic.
150
2014-07-01
2014-04-01
2014-01-01
2013-10-01
2010
SCF
Field
Period
2013-07-01
SCF
Average
Equity
Holdings=
$213k
(nominal)
2013-04-01
2013-01-01
2012-10-01
2012-07-01
2012-04-01
2012-01-01
2011-10-01
2011-07-01
2011-04-01
2011-01-01
The Wilshire index increased 36% between 2010 Q1
to 2013 Q1, while SCF aggregate nominal holdings
rose 29% between the 2010 and 2013 surveys.
2010-10-01
10000
2010-07-01
20000
2010-04-01
2010-01-01
2009-10-01
2009-07-01
2009-04-01
2009-01-01
2008-10-01
2008-07-01
2008-04-01
2008-01-01
2007-10-01
2007-07-01
2007-04-01
2007-01-01
2006-10-01
2006-07-01
2006-04-01
2006-01-01
2005-10-01
2005-07-01
2005-04-01
2005-01-01
5000
2004-10-01
2004-07-01
Aggregate Stock Market Valuation
Wilshire 5000 Stock Value Index and SCF Mean Equity Holdings
25000
2013
SCF
Field
Period
15000
SCF
Average
Equity
Holdings=
(nominal)
$270K
$228K
(2013 $)
0
18
Financial Assets
• Ownership of any financial asset stable at 94%
• Conditional median declined 8% to $21,200 in 2013
• Conditional mean increased 5% to $270,100 in
2013
19
Nonfinancial Assets
• Ownership of any nonfinancial asset stable at 91%
• Conditional median declined 10% to $148,400 in
2013
• Conditional mean declined 6% to $407,200 in 2013
• Focus on housing
• Net housing wealth – house value minus all homesecured debt
20
Homeownership and housing wealth
continued to decline for most families
• Homeownership rates
• Conditional means - net
housing wealth
100%
700.0
80%
Percent
70%
60%
50%
2007
40%
2010
30%
2013
20%
10%
0%
Thousands of 2013 $
90%
600.0
500.0
400.0
2007
300.0
2010
200.0
2013
100.0
0.0
All
Bottom 50 Next 40
Usual income group
Top 10
All
Bottom 50 Next 40
Top 10
Usual income group
21
Homeownership decline driven by families
under 65
• Homeownership rates
• Conditional means - net
housing wealth
90%
350
70%
Percent
60%
50%
2007
40%
2010
30%
2013
20%
10%
0%
< 35
35 to 64
Age of family head
65 +
Thousands of 2013 $
80%
300
250
200
2007
150
2010
100
2013
50
0
< 35
35 to 64
65 +
Age of family head
22
Debt
• Ownership of any debt stable at 75%
• Conditional median declined 2% to $115,000 in
2013
• Conditional mean declined 5% to $156,700 in 2013
• Focus on one specific type of debt
• Education loans – strong growth over the last decade
• Examine families with heads age < 40
23
Education loan growth: 2001-2013 SCF
(family heads less than 40 years old)
• The basics
• Distribution of education
debt (2013 $)
2001
2013
Percent with
education debt
22.4
38.8
Less than 25
thousand
Mean value
16.9
29.8
between 25 and
50 thousand
Median value
10.5
16.8
(thousands of 2013 $)
(thousands of 2013 $)
2001
between 50 and
100 thousand
more than 100
thousand
2013
6% 1%
6%
13%
16%
17%
64%
78%
24
Concentration of debt by income changed;
concentration of debt by degree unchanged
60%
80%
50%
70%
60%
40%
30%
2001
20%
2013
10%
Percent
Percent
• Share of education debt • Share of education debt
by usual income
by degree level
50%
40%
30%
2001
20%
2013
10%
0%
Less than 30
thousand
30 to 60 More than 60
thousand
thousand
Usual income group
0%
Bachelor's
Degree or
Higher
Associate's
Degree
No Degree
Degree level
25
Incremental payment burden of education
loans
• Composition of average payment to average income ratios
in 2013
25%
20%
22.1%
2.7%
3.8%
Percent
15%
19.7%
1.5%
3.7%
10%
15.6%
5%
14.5%
16.1%
3.5%
Including deferred education
loan payments
2.3%
Including education loan
payments
10.3%
Excluding education loan
payments
0%
Bachelor's Degree or Associate's Degree
Higher
No Degree
Degree level
26
2016 SCF Redesign
• Focus on how microeconomic heterogeneity affects
macroeconomic outcomes, especially for high-wealth
• Reduce respondent burden; less threatening questions
• Improve coordination and integration with other household
surveys and administrative data sources
• Adopt emerging technologies in fieldwork and post-survey
statistical linking of external information
• Release same high-quality data faster, make SCF data more
accessible, improve documentation and resources
• Adapt to changing use of financial products and services
27
Prepaid Accounts
Problem
1/20/2016
• Approximately 10% of the population report being
“unbanked”
• See respondents with debit cards, direct deposits, or auto
withdrawals, who then say “no” to checking account
• Increasing use of pre-paid cards with no associated
account?
Solution
• Add questions on ownership of reloadable prepaid debit
card and government benefit card (e.g. EBT, DirectExpress)
• Ask about prepaid debit card balances
28
Education Loans
Problem
• Missing crucial details about education loans
1/20/2016
Solution
• Added question(s) about who within the family had their
education funded by the particular loan
• Added question(s) about whether it is a federal government loan
(Stafford, Parent Plus, etc.)
• Added question(s) about whether the education program was
completed (Yes/No/Still enrolled)
• Restructure and modify repayment questions to better identify
(for example) respondents participating in grace period, incomebased repayment, loan forgiveness, or other programs
29
Response to Financial Shocks
Problem
Household borrowing and spending responses to financial
constraints is not well understood
1/20/2016
•
Solution:
Two-part “hypothetical” debt repayment decision:
•
1.
Assuming you experience a financial emergency and are unable
to pay your bills, your primary response would be?
• Borrow (or borrow more)
• Cut spending
• Postpone/be late on payments
• Withdraw from existing accounts/sell assets?
2.
What sources/accounts/assets/spending categories would those
be? (prioritized list of two items)
• Follow-up tailored to the primary response category
30
Survey of Household Economics
and Decisionmaking
​David Buchholz and Jeff Larrimore
​Consumer & Community Development Research,
​Division of Consumer & Community Affairs
​January 21, 2016
​Urban Institute
​The analysis and conclusions set forth in this presentation are our own and do not indicate
concurrence of the Federal Reserve Board of Governors, the Federal Reserve System, or
their staff.
INTRODUCTION
Motivation for Survey
• Cast light on current issues affecting consumer financial well-being
and monitor recovery from the financial crisis
• Help monitor trends in consumer behavior and sentiment as they
relate to household finances and the broader economy
• Fill data gaps and provide insights into questions for which there may
not be other reliable data sources
​Board of Governors of the Federal Reserve System
32
SHED OVERVIEW
What is the SHED?
• Nationally representative survey of U.S. adults age 18 and older
• Conducted annually by the Federal Reserve Board since 2013
• Data presented today is from the Fall 2014 survey
• Focus on consumer finance issues, particularly with respect to reasons
behind decisions
• Summary report published as Report on the Economic Well-Being of U.S.
Households
• Data is publicly available at
http://www.federalreserve.gov/communitydev/shed.htm
​Board of Governors of the Federal Reserve System
33
Table of Contents
​1
2​
3​
4​
5​
SECTION
​6
7​
8​
9​
SECTION
​Introduction
​Banking and Credit
SECTION
SECTION
​Economic Well-Being
​Education and Student
Loans
SECTION
SECTION
​Housing and Living
Arrangements
​Retirement
SECTION
SECTION
​Economic Fragility and
Emergency Savings
​Additional Research
SECTION
​Savings and Spending
​Board of Governors of the Federal Reserve System
34
SHED OVERVIEW
Survey Methods: GfK KnowledgePanel®
Random selection of U.S. Households into KnowledgePanel®
using Address Based Sampling
Accept invitation into panel and complete profile survey
Offered computer and internet if none in household
(about 55,000 adults)
Invited to take SHED survey
(8,975 adults)
Complete SHED survey
(5,896 adults – 65.7%)
​Board of Governors of the Federal Reserve System
35
SHED OVERVIEW
SHED Sample Overview
SHED sample is made up of three components
1,710 adults
Re-interviewed
respondents from 2013
SHED survey
​Board of Governors of the Federal Reserve System
2,552 adults
New respondents
randomly selected
1,634 adults
Oversample of adults
with household income
under $40,000
36
SHED OVERVIEW
Data Validity: 401(k) account
​Source: Larrimore, Schmeiser, Devlin-Foltz (2015)
​Board of Governors of the Federal Reserve System
37
SHED OVERVIEW
Data Validity: Health Insurance
​Source: Larrimore, Schmeiser, Devlin-Foltz (2015)
​Board of Governors of the Federal Reserve System
38
SHED OVERVIEW
Data Validity: Homeownership
​Source: Larrimore, Schmeiser, Devlin-Foltz (2015)
​Board of Governors of the Federal Reserve System
39
Economic Well-Being
TOP TAKEAWAYS
TOP
TAKEAWAYS
​65%
​say they are “doing OK” or
“living comfortably,”
but many still face some
financial stress.
​29%
​expect their income to be
higher in the coming
year.
​Board of Governors of the Federal Reserve System
​49%
​of part-time workers
would prefer to work more
hours at their current
wage.
40
ECONOMIC WELL-BEING
Measuring Financial Health
Which one of the following best describes how well you are managing
financially these days?
Finding it
difficult to
get by
Just
getting by
Doing
okay
Living
comfortably
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
41
ECONOMIC WELL-BEING
Expectations for future income
Next year, do you think your income will be higher, lower, or about the same
as it was this year?
Higher
Lower
The Same
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
42
ECONOMIC WELL-BEING
Desire for Additional Employment
At your current wage, would you prefer to work more, less, or about the
same amount as you currently work?
36%
49%
5%
Among
All
Workers
58%
More Hours
Less Hours
The Same
Number of Hours
Among
Part-time
Workers
3%
48%
​Asked of employed respondents. n = 2,846
​Board of Governors of the Federal Reserve System
43
Housing and Living Arrangements
TOP TAKEAWAYS
TOP
TAKEAWAYS
​81%
​of renters would prefer to
own their home if they
could afford to do so.
​43%
​of homeowners believe
the value of their home
increased since 2013...
​Board of Governors of the Federal Reserve System
​…but
14%
​of homeowners think
that they owe more on
their home than it is
worth.
44
LIVING ARRANGEMENTS
Why Do You Live with Others?
20% of adults are living
with individuals not in their
immediate family
Of those living with others:
64% are doing so to save money or to
provide financial assistance to someone
living with them
14% are doing so to provide or receive
assistance with caregiving activities
​Board of Governors of the Federal Reserve System
45
LIVING ARRANGEMENTS
What Is Your Living Arrangement?
Which one of the following best describes your housing arrangement?
61% own their homes
28% pay rent
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
46
LIVING ARRANGEMENTS
Why People Rent
81%
Please select all the reasons below for why you
rent rather than own your home:
Of renters would
prefer to own
their home if
they could
afford to do s0
​Asked of renters. n = 1,769
​Board of Governors of the Federal Reserve System
47
LIVING ARRANGEMENTS
Why People Rent
Household Income
Renters who make under $40,000
are more likely to say:
Renters who make over $100,000
are more likely to say:
“I can’t afford
down payment”
“It’s more
convenient to
rent”
or
“I can’t qualify for
a mortgage”
or
“I plan on moving
in the near future”
​Asked of renters. n = 1,769
​Board of Governors of the Federal Reserve System
48
LIVING ARRANGEMENTS
Why People Own
​Asked of homeowners. n = 3,638
​Board of Governors of the Federal Reserve System
49
LIVING ARRANGEMENTS
Perceived Home Values Increasing
Compared to 12 months ago, do you think the value of your home today is
higher, lower or stayed the same?
​Asked of homeowners who owned since 2012. n=3,402
​Board of Governors of the Federal Reserve System
50
LIVING ARRANGEMENTS
Expectations for Further Increases
In the next 12 months, how do you think that home prices in your
neighborhood will change?
​Asked of all homeowners. n = 3,638
​Board of Governors of the Federal Reserve System
51
LIVING ARRANGEMENTS
Underwater on Mortgage Balance
Does the total amount of money you currently owe on your primary home
exceed the current value of your home?
11%
17%
15%
14%
​Asked of homeowners with a mortgage. n = 2,016
​Board of Governors of the Federal Reserve System
52
Economic Fragility and Emergency Savings
TOP TAKEAWAYS
TOP
TAKEAWAYS
​24%
​experienced some form
of financial hardship in
the past year
​47%
​could not pay a $400
emergency expense or
would borrow / sell
something to do so
​Board of Governors of the Federal Reserve System
​31%
​went without needed
medical care because
they couldn’t afford it
53
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Experienced an Economic Hardship
Over the past year, have you or your family living with you experienced any
financial hardship such as a job loss, drop in income, health emergency,
divorce, or loss of your home?
24%
Yes
75%
No
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
​Asked of respondents who experienced a hardship. n = 1,527
54
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Saving for Major Emergencies
(1) Have you set aside emergency or rainy day funds that would cover
your expenses for 3 months in case of sickness, job loss, economic downturn,
or other emergencies?
Set Aside
Emergency Funds
Has Not Set aside
Emergency Funds
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
55
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Saving for Major Emergencies
(1) Have you set aside emergency or rainy day funds that would cover
your expenses for 3 months in case of sickness, job loss, economic downturn,
or other emergencies?
(2) If you were to lose your main source of income, could you cover your
expenses for 3 months by borrowing money, using savings, or selling
assets?
Cover Expense
Could not
Set Aside
by borrowing or
cover expenses
Emergency Funds
selling assets
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
56
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Covering Smaller Emergency Expense
Suppose that you have an emergency expense that costs $400. Based on
your current financial situation how would you pay for this expense?
53%
Pay using
cash or
credit card
paid in full
33%
Pay using debt
or by selling
something
14%
Could not
pay
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
57
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Out of Pocket Medical Expenses
During the past 12 months, have you had any unexpected major medical
expenses that you had to pay out of pocket (that were not completely paid
for by insurance)?
24%
Yes
75%
No
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
58
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Avoiding Medical Treatment
During the past 12 months, was there a time when you needed any of the
following, but didn’t get it because you couldn’t afford it?
31%
went without at
least one form of
medical treatment
in the last year
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
59
ECONOMIC FRAGILITY & EMERGENCY SAVINGS
Avoiding Medical Treatment
During the past 12 months, was there a time when you needed any of the
following, but didn’t get it because you couldn’t afford it?
Uninsured
Insured
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
60
Savings and Spending
TOP TAKEAWAYS
TOP
TAKEAWAYS
​20%
​of respondents spent
more than their income
in the past year
​30%
​of non-retirees saved
nothing in the past year
​Board of Governors of the Federal Reserve System
61
SAVINGS & SPENDING
Do Households Spend More than
They Earn?
In the past 12 months, would you say that your household’s total
spending was more, the same or less than your income?
Spending less than
income
41%
Spending equals
Income
37%
Spending exceeded
Income
20%
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
62
SAVINGS & SPENDING
Are People Saving?
In the past 12 months, what percent of your household’s total gross
income (before taxes and deductions) did you set aside as savings?
Did not save
any portion of
income
30%
of non-retirees
said they saved
nothing in the
past year
Did
Saved at least
some of income not state
Income less
than $40,000
Income $40,000
To $100,000
Income greater
than $100,000
​Asked of non-retired respondents. n = 4,561
​Board of Governors of the Federal Reserve System
63
SAVINGS & SPENDING
What Are People Saving For?
Which of the following categories, if any, are you saving money for?
​Asked of non-retirees who reported saving a positive portion of their income. n=2,587
​Board of Governors of the Federal Reserve System
64
SAVINGS & SPENDING
What Are People Saving For?
Which of the following categories, if any, are you saving money for?
Most popular answers
​Asked of non-retirees who reported saving a positive portion of their income. n=2,587
​Board of Governors of the Federal Reserve System
65
Banking and Credit
TOP TAKEAWAYS
TOP
TAKEAWAYS
​32%
​of those who applied for
credit were turned down
or given less credit than
they applied for
​56%
​of respondents with a
credit card always paid
their bill in full in the
past year
​Board of Governors of the Federal Reserve System
​17%
​of lower-income
respondents do not have
a checking or savings
account
66
BANKING AND CREDIT
Unbanked and Underbanked
Unbanked: Do you currently have a checking, savings, or money market
account?
Underbanked: In the past 12 months, have you used a check cashing
service, money order, pawn shop loan, auto title loan, paycheck advance,
or payday loan?
Unbanked
Underbanked
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
67
BANKING AND CREDIT
Frequency of Credit Applications
Please select all of the types of credit below that you have applied for in the
past 12 months
37%
applied for
some form of
credit in the
past 12
months
​Asked of respondents who reported having applied for credit in the past 12 months. n = 2,054
​Board of Governors of the Federal Reserve System
68
BANKING AND CREDIT
Outcome of Credit Application
In the past 12 months, did any of the following happen to you:
You were you turned down for credit
You were approved, but not given as much credit as you applied for
Approved
Not denied,
but offered less
credit than
desired
Denied
Outright
​Asked of respondents who reported having applied for credit in the past 12 months. n = 2,054
​Board of Governors of the Federal Reserve System
69
BANKING AND CREDIT
Additional Demand for Credit?
12%
Why did you choose not to submit a credit
application when you desired credit in the past 12
months?
of adults
desired credit
in the past 12
months but
did not submit
an application
7%
Obtained money
some other way
9%
Other/refused
​Asked of respondents who desired credit but did not apply. n = 460
​Board of Governors of the Federal Reserve System
70
BANKING AND CREDIT
How Confident Do Consumers Feel?
If you applied for a mortgage today, how confident are you that your
application would be approved?
13%
Very confident
41%
26%
Somewhat confident
Not confident
Don’t know
20%
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
71
BANKING AND CREDIT
Are People Paying Credit Card Bills?
In the past 12 months have
you always paid your credit
card bills in full each
month?
​Among those with at least one credit card. n = 3,263
​Board of Governors of the Federal Reserve System
72
BANKING AND CREDIT
Are People Paying Credit Card Bills?
Among those who do not pay off credit cards in full each month:
​Among those with at least one credit card who do not pay bill in full each month. n = 1,366
​Board of Governors of the Federal Reserve System
73
Education and Student Loans
TOP TAKEAWAYS
TOP
TAKEAWAYS
​23%
​of the population
currently has outstanding
education debt
​16%
​of borrowers without a
degree are behind on
their student loan
payments
​Board of Governors of the Federal Reserve System
​38%
​of non-graduates say that
family responsibilities
contributed to not
finishing their degree
74
EDUCATION
Education Debt Burden
Do you currently owe any money or have any loans that you used to pay for
the education of anyone below: (respondents could choose all that apply)
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
75
EDUCATION
Form of Education Debt
Is the money you owe for education a student loan, a home equity loan,
credit card debt, or some other type of loan: (respondents could choose all that apply)
​Asked of respondents who owe money for education. n = 1,272
​Board of Governors of the Federal Reserve System
76
EDUCATION
Did you borrow for your education?
Use of student loans to finance own education, including loans which have
been fully repaid
​Asked of all respondents. n = 5,896
​Board of Governors of the Federal Reserve System
77
EDUCATION
Repayment status by race/ethnicity
Behind
on payments
Current
on payments
Paid off
loan
​Among respondents who borrowed to pay for their own education. n = 1,249
​Board of Governors of the Federal Reserve System
78
EDUCATION
Does Loan Status Vary by Degree
Completion?
Percent of borrowers (including those who completely repaid loan)
behind on payments on one or more loans for their own education
​Asked of those who took out student loans for their education and report the institution attended. n=1,249
​Board of Governors of the Federal Reserve System
79
EDUCATION
Does Loan Status Vary by Institution?
Percent of borrowers (including those who completely repaid loan)
behind on payments on one or more loans for their own education
​Asked of those who took out student loans for their education and report the institution attended. n=1,249
​Board of Governors of the Federal Reserve System
80
EDUCATION
Is College Worth the Cost?
How would you say the lifetime financial benefits of your bachelor’s or
associate degree program or your most recent educational program
compares to its financial costs?
Benefits
higher
About
the same
Costs
higher
For-profit
Nonprofit
Public
​Asked of respondents who completed at least some college and reported the institution attended. N=3,080
​Board of Governors of the Federal Reserve System
81
EDUCATION
Why don’t people complete degree
after starting college?
​Asked of those not currently enrolled who started college but did not complete degree. n=866
​Board of Governors of the Federal Reserve System
82
EDUCATION
Why don’t people complete degree?
Percent of respondents who cite “family responsibilities” as a reason for
not completing a college degree:
​Asked of those not currently enrolled who started college but did not complete degree. n=1,059
​Board of Governors of the Federal Reserve System
83
Retirement
TOP TAKEAWAYS
TOP
TAKEAWAYS
​39%
​had given little or no
thought to financial
planning for their
retirement
​31%
​having no retirement
savings or pension
whatsoever
​Board of Governors of the Federal Reserve System
​51%
​are not confident or are
slightly confident in their
ability to manage their
retirement savings
84
RETIREMENT
Are You Planning
for Retirement?
How much thought have
you given to the financial
planning for your
retirement?
13%
A lot
21%
A fair
amount
17%
None at all
25%
Some
22%
A little
​Asked of those not currently retired. n=4,414
​Board of Governors of the Federal Reserve System
85
RETIREMENT
Who Is Planning for Retirement?
None at all
A little
Some
A fair amount
A lot
​Asked of those not currently retired. n=4,414
​Board of Governors of the Federal Reserve System
86
RETIREMENT
What Is Your Retirement Plan?
Which one of the following best describes your plan for retirement?
Most popular answers:
Less than $40,000
$40,000-$100,000
Greater than $100,000
​Among respondents who are not currently retired or out of work due to a disability. n=3,894
​Board of Governors of the Federal Reserve System
87
RETIREMENT
Retirement Savings Differ by Income
Do you have the following type of retirement savings?
401(k), 403(b), Thrift
Employer pension
IRA
Outside savings
Any retirement savings
​Among respondents who are not currently retired. n=4,414
​Board of Governors of the Federal Reserve System
88
RETIREMENT
Lack of Retirement Savings By Age
Percent of respondents with no retirement savings
​Among respondents who are not currently retired. n=4,414
​Board of Governors of the Federal Reserve System
89
RETIREMENT
Why not invest in a 401(k)?
Please select all the reasons below for why you do not currently invest in
a 401(k), 403(b), thrift, or other defined contribution plan from work.
​Among respondents who are not currently retired. n=4,414
​Board of Governors of the Federal Reserve System
90
RETIREMENT
Investment Confidence & Knowledge
How confident are you in your ability to
make the right investment decisions when
managing and investing the money in your
retirement accounts?
12%
Very
confident
​Asked of non-retired respondents with savings in a 401(k),
IRA, or other self-directed retirement account. n = 2,566
​Board of Governors of the Federal Reserve System
41%
of respondents
whose employer
offers a 401(k) type
plan say they do not
know how much
their employer will
match
​Among employed respondents with a 401(k) type account or
whose employer offers a plan. n = 2,122
91
RETIREMENT
Retirement Strategies Differ by Age
How are you planning to pay (or are you paying) expenses during retirement?
Most popular answers:
PLANNING
30–44
45–59
60+
ACTUAL
Retired
​Asked of those not currently retired (n=3,163) and current retirees (n=1,482)
​Board of Governors of the Federal Reserve System
92
Additional Research
​Board of Governors of the Federal Reserve System
93
ADDITIONAL RESEARCH
Internal Research
• General research projects
• SHED data validity
• Intergenerational mobility of well-being and expectations for future generations
• Projects using geographic identifiers for respondents
• Zip code (2013-2015 data), census tract (2015)
• Well-being of respondents in concentrated poverty areas
• Relationship between self-stated reasons for housing and local housing market conditions
• Relationship between self-assessed local housing price trends / predictions and actual trends
in local area
​Board of Governors of the Federal Reserve System
94
ADDITIONAL RESEARCH
External Research
• SHED data is publicly available
• http://www.federalreserve.gov/communitydev/shed.htm
• Additional profile variables available for purchase from firm that
administers the panel from which respondents are drawn (GfK)
• Encourage use of the data by external researchers, including potential
collaboration for internal variables such as local-level geographies
​Board of Governors of the Federal Reserve System
95
TOP TAKEAWAYS
​Board of Governors of the Federal Reserve System
96
An Example of Recent Research
using the SCF
• “Exploring the Racial Wealth Gap Using the Survey
of Consumer Finances”
• Gustavo Suarez and Jeffrey Thompson (2015)
97
Average Networth of White Families Relative to Black and
Hispanic Families
800%
700%
600%
Ratio
500%
400%
300%
200%
100%
0%
1989
1992
1995
1998
white relative to black
2001
2004
white relative to Hispanic
2007
2010
2013
Decomposing the Racial Wealth Gap
• How much of the gap is due to factors related to
the accumulation of wealth?
•
•
•
•
Aging
Education
Inheritance
Saving/Investing Outlook
• How much of the gap is due to factors we cannot
account for in the data?
• We explore these gaps between white, African
American, and Hispanic families using the Survey of
Consumer Finances, 1989 to 2013.
Age Profile (for household head) by Race (2013)
%Distribution
Average
Age
Under 35
35 to 49
50 to 64
65+
White
53
18%
24%
30%
27%
Black
49
23%
29%
29%
18%
Hispanic
44
32%
36%
22%
11%
Education and Income for "Prime" Working-Age
Household Heads (30to59) by Race Group
"Usual" Income
Highest Degree Obtained
Less than
High
High School
School
Only
Some College,
No Degree
BA only
Advanced
Degree
Mean
Median
White
$118,259
$75,371
6%
29%
26%
24%
15%
Black
$54,107
$40,581
9%
33%
34%
17%
8%
Hispanic
$55,770
$40,581
31%
36%
21%
7%
4%
Total
$99,162
$60,872
9.7%
30.8%
26.5%
20.8%
12.2%
Inheritance by Major Race Group - Household Head
Ages 30 to 59
Ever Received
Inheritance
Conditional Mean Value
of Total Inheritances
Received*
Conditional Median
Value of Total
Inheritances Received*
Expect to Receive an
(another)
inheritance
White
23%
$236,000
$55,000
19%
Black
11%
$83,000
$49,000
6%
Hispanic
6%
$86,000
$29,000
4%
Attitudes toward Saving and Investing
(family heads ages 35 to 59)
Risk Tolerant
Long Horizon
Luxury
Borrower
white
23%
71%
18%
Black
15%
53%
21%
Hispanic
15%
52%
17%
Total
21%
67%
18%
Decomposing the White/Non-White Wealth Gap
(Oaxaca-Blinder)
Controls Include Demographic,
Labor Force, Inheritance, Health
Status, Investment Attitudes,
Parental Longevity, and Regional
Real Estate Variables
Controls Also
Include Usual
Income
Covariates Also
Include Usual
Income and Home
Ownership
(1)
(2)
(3)
Percent of Black/White Networth Difference
Explained
0.60
0.67
0.80
Percent of Hispanic/White Networth Difference
Explained
0.82
0.89
1.06
Decomposing Wealth Gaps using Nonparametric
Reweighting Techniques (DFL)
Panel A. Black/White Wealth Differences
Panel B. Hispanic/White Wealth Differences
Observables Explain:
Mean
Observables Explain:
No Income or
Housing
With
Income
With Income
and Housing
59%
67%
79%
Mean
No Income or
Housing
With
Income
With Income
and Housing
88%
97%
112%
ptile of
wealth dist.
ptile of
wealth dist.
10
96%
97%
100%
10
106%
105%
109%
25
44%
52%
63%
25
85%
102%
125%
50
57%
63%
81%
50
70%
76%
96%
75
57%
64%
73%
75
72%
79%
88%
90
59%
64%
68%
90
72%
78%
81%
95
58%
62%
65%
95
71%
76%
79%
• The full report can be found online:
• http://www.federalreserve.gov/econresdata/feds/2
015/files/2015076pap.pdf
Thank you
Questions?
jeffrey.p.thompson@frb.gov
SCF Website
www.federalreserve.gov/econresdata/scf/scfindex.htm
107
Additional results
108
Median Income: CPS,SCF
60
55
50
45
40
35
1988
1991
1994
1997
2000
SCF Primary Economic Unit (PEU)
2003
2006
2009
2012
CPS Household
109
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Top 1% Share in IRS & SCF
0.250
0.225
0.200
0.175
0.150
0.125
Top1_IRS
Top1_scf
0.100
0.075
0.050
110
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Top 10% Share in IRS & SCF
0.550
0.525
0.500
0.475
0.450
0.425
0.400
0.375
Top10_IRS
Top10_scf
0.350
0.325
0.300
111
Retirement account ownership fell for all but
the highest income, values rose across groups
• Ownership rates
• Conditional means
100%
700.0
90%
Percent
70%
60%
50%
2007
40%
2010
30%
2013
20%
Thousands of 2013 $
600.0
80%
500.0
400.0
2007
300.0
2010
2013
200.0
100.0
10%
0%
All
Bottom 50 Next 40
Usual income group
Top 10
0.0
All
Bottom 50 Next 40
Top 10
Usual income group
112
• Ownership rates
• Conditional means
70%
400
60%
350
50%
300
40%
2007
30%
2010
2013
20%
10%
Thousands of 2013 $
Percent
Retirement accounts grew for older families,
and remained stable for younger families
250
200
2007
150
2010
2013
100
50
0%
< 35
35 to 64
65 +
Age of family head
0
< 35
35 to 64
65 +
Age of family head
113
Corporate equity ownership fell for all but the
top income group, values rebounded for all
• Ownership rates
• Conditional means
100%
1200.0
90%
Percent
70%
60%
50%
2007
40%
2010
30%
2013
20%
Thousands of 2013 $
1000.0
80%
800.0
2007
600.0
2010
400.0
2013
200.0
10%
0%
All
Bottom 50 Next 40
Usual income group
Top 10
0.0
All
Bottom 50 Next 40
Top 10
Usual income group
114
Business ownership declined across income
groups
• Ownership rates
• Conditional means
50%
3000.0
45%
Percent
35%
30%
25%
2007
20%
2010
15%
2013
10%
Thousands of 2013 $
2500.0
40%
2000.0
2007
1500.0
2010
1000.0
2013
500.0
5%
0%
0.0
All
Bottom 50
Next 40
Usual income group
Top 10
All
Bottom 50 Next 40
Top 10
Usual income group
115
Debt Burden and Credit Markets
• Payment-to-income ratio (PIR)
• All required debt payments divided by income
• PIR > 40% – usually an indicator of financial distress
• Credit market experiences
• Turned down or fear denial of credit
• 60 days late on any payment in the last 12 months
116
Lower debt payment ratios
25%
25%
20%
20%
15%
15%
2007
2010
10%
Percent
Percent
Median PIR for debtors
2007
2010
10%
2013
5%
2013
5%
0%
All
Bottom 50 Next 40
Usual income group
Top 10
0%
< 35
35 to 64
65 +
Age of family head
117
Fewer households with high payment burdens
PIR > 40%
20%
16%
18%
14%
16%
12%
10%
12%
10%
2007
8%
2010
6%
2013
4%
Percent
Percent
14%
2007
8%
2010
6%
2013
4%
2%
2%
0%
All
Bottom 50 Next 40
Usual income group
Top 10
0%
< 35
35 to 64
65 +
Age of family head
118
Modest changes in credit constraints
40%
45%
35%
40%
30%
35%
30%
25%
2007
20%
2010
15%
2013
10%
Percent
Percent
Turned down or feared denial of credit
25%
2007
20%
2010
15%
2013
10%
5%
5%
0%
All
Bottom 50 Next 40
Usual income group
Top 10
0%
< 35
35 to 64
65 +
Age of family head
119
Fewer households are delinquent
60 days past due on a payment over the past year
12%
10%
9%
10%
8%
8%
6%
5%
2007
4%
2010
3%
2013
2%
Percent
Percent
7%
2007
6%
2010
4%
2013
2%
1%
0%
0%
All
Bottom 50 Next 40
Usual income group
Top 10
< 35
35 to 64
65 +
Age of family head
120
Adjusted Net Worth Changes, 2010-14
(Adds Subsequent House & Equity Gains)
Usual Income Group
Balance Sheet Item
Bottom 50
Next 40
Top 10
-10%
2%
0%
(Less) Mortgages
5%
3%
1%
Business Plus Corporate Equity
-3%
6%
7%
Other Assets
-1%
-1%
-1%
(Less) Non-Mortgage Debt
0%
0%
0%
Total
-9%
11%
7%
Housing
121
Sources of wealth changes,
2010-13
Age of Family Head
Balance Sheet Item
< 35
35 to 64
65 +
Housing
-11%
-5%
-2%
(Less) Mortgages
17%
3%
0%
Business Plus Corporate Equity
3%
0%
5%
Other Assets
0%
-3%
2%
(Less) Non-Mortgage Debt
-1%
0%
0%
Total
8%
-5%
6%
122
Corporate equity ownership fell, values rose
for age groups; older families saw larger gains
• Ownership rates
• Conditional means
600
60%
500
Percent
50%
40%
2007
30%
2010
2013
20%
Thousands of 2013 $
70%
400
2007
300
2010
200
2013
100
10%
0%
< 35
35 to 64
Age of family head
65 +
0
< 35
35 to 64
65 +
Age of family head
123
Business ownership declined across age groups
• Ownership rates
• Conditional means
20%
2500
16%
Percent
14%
12%
10%
2007
8%
2010
6%
2013
4%
Thousands of 2013 $
18%
2000
1500
2007
1000
2010
2013
500
2%
0%
< 35
35 to 64
Age of family head
65 +
0
< 35
35 to 64
65 +
Age of family head
124
CONCLUSION AND APPENDIX
Response Rate Summary Metrics
A. Study-Specific Average Panel Recruitment Rate (RECR)
13.9%
B. Study-Specific Average Household Profile Rate (PROR)
64.1%
C. Study-Specific Average Household Retention Rate (RETR)
33.8%
D. Study Completion Rate (COMPR)
65.7%
E. Study Breakoff Rate (BOR)
F. Study Qualification Rate (QUALR)
2.8%
100.0%
G. Cumulative Response Rate 1 (CUMRR1)
5.8%
H. Cumulative Response Rate 2 (CUMRR2)
2.0%
​Callegaro, Mario & DiSogra, Charles (2008). Computing response metrics for online panels. Public Opinion Quarterly 72(5). pp. 1008-1032.
​Board of Governors of the Federal Reserve System
125
CONCLUSION AND APPENDIX
RDD Phone Response Rates
​Board of Governors of the Federal Reserve System
126