The increasing financial obligations burden of US households: who is affected?

Abstract

The purpose of this paper is to examine factors associated with changes in the proportion of households with high financial obligations ratios in the United States. The proportion of households paying more than 40% of income for debt, rent, vehicle leases, property taxes and homeowners’ insurance, which we refer to as having a heavy burden, increased from 18% in 1992 to 27% in 2007. Multivariate analysis of a combination of six Survey of Consumer Finances data sets indicates that the likelihood of having a heavy burden was positively associated with homeownership, self‐employment and retirement status. Those with an optimistic 5‐year expectation of the economy were more likely to be in a household with a heavy burden. Education was positively related to having a heavy burden, suggesting that having a heavy burden is not simply a cognitive error.

Factors associated with financial independence of young adults

“…Among young adults aged 18–23, educational attainment statuses may affect determinants of their financial independence. Previous research has suggested that education may affect household financial obligation burden (Hanna et al ., ) and financial difficulty status (Patel et al ., ). In this study, educational attainment had four categories: having never attended college, been in college, dropped out of college and graduated from college.…”

“I think the middle class is disappearing”: Crisis perceptions and consumption patterns in Spain

“…Scholarly work on consumption in the context of a crisis is actually reduced to just a few contributions. There is some academic literature on values and consumption patterns (see, e.g., Faganel, 2011) and several economicgrounded articles and reports that try to measure the impact of the crisis in terms of household wealth (Arrondel, Savignac, & Tracol, 2014;Wahlen, 2016) or the burden of financial obligations (Borgeraas, Poppe, & Lavik, 2016;Hanna, Youh, & Chatterjee, 2012). From a more sociological perspective, there has been some work on consumption and the crisis in the form of national studies: Some examples are the articles devoted to the consumer strategies of precarious groups and families in Italy (Arcidiacono, 2013;Secondulfo & Tronca, 2016) or the middle classes in Portugal (Mauritti & Da Cruz Martins, 2014), or how nationalism might emerge as a feature of the new politics of consumption (Lekakis, forthcoming).…”

Financial Behavior and Attitudes of Asians Compared to Other Racial/Ethnic Groups in the United States

“…Although the SCF has not provided information on geographic location since the 1998 survey, Census data indicate that Asians and Hispanics tend to live in metropolitan areas and also tend to reside in the West (cf. Hanna et al 2012). Households in metropolitan areas and those in the West have lower rates of home ownership than those in non-metro areas and those in other regions.…”

“…Whites (19 %) and Asians (18 %) were less likely to overdraw than African Americans (31 %), Hispanics (27 %), and other racial/ethnic groups (29 %). Hanna et al (2012) reported that Asians were more likely than Whites to have financial obligations amount to over 40 % of their income.…”