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Federal Reserve Report — The Economic Well-Being of U.S. Households

Posted By Kim Legato, Tuesday, May 28, 2019

Every year for the last six the Federal Reserve Board has released a report on the economic well-being of the nation’s households. The 2018 report — titled the Survey of Household Economics and Decisionmaking (SHED) — says things are slightly better than the excellent results of 2017.

The report surveyed 11,000 adults across all economic situations and included all races and minorities. Most said they have experienced “substantial” gains since the survey started in 2013. It is — the board says — in line with the ongoing economic expansion being experienced nationwide.

These are the items considered in the survey:

  Income

  Employment

  Handling of expenses

  Banking

  Credit

  Housing

  Education

  Retirement

Here is a summary:

  75% said they are doing okay or living comfortably

  That’s up 12% from the first survey in 2013

  Asked how to pay a $400 unexpected expense

  61% said they could pay with cash or savings or a credit card

  If a credit card is used, the balance could be paid off the next statement

  12% would not be able to cover the $400 expense

  In 2013 only half could have paid with cash or by credit card

As for race, education level and — in some cases — geography, some in those categories are still experiencing some financial stress.

  80% of caucasians say they are at least doing okay financially

  66% of African Americans and hispanics said the same thing

  87% of those with Batchelor degrees or higher said they are at least doing okay

  Just 64% of those with a high school degree or less said they are at least doing okay

  80% of those living in middle-or-upper income neighborhoods are satisfied overall with their community

  60% of those living in low-to-moderate income neighborhoods are satisfied overall with their community

Federal Reserve Board Governor Michelle Bowman said the report shows a growing American economy is supporting most American families. “At the same time, the survey does find differences across communities, with just over half of those living in rural areas describing their local economy as good or excellent compared to two-thirds of those living in cities,” she said. “Across the country, many families continue to experience financial distress and struggle to save for retirement and unexpected expenses.”

Here’s more:

  Family income changes from month-to-month continues to be a financial strain for some individuals

  30% have family income that varies from month-to-month

  10% struggled at least once during the year to make ends meet because of income changes

  Financial support was needed from family or friends for that group

  That is most common among young adults

  Most adults are working as much as they want — that is an indication of full employment

  Some — however — remain unemployed or underemployed

  10% of adults are not working and want to work

  However, many are not actively looking for work

  4% of adults are not working and want to work and had applied for jobs in the last 12 months

  That’s close to the 3.8% national unemployment rate

  20% are working but want to work more

  African Americans, hispanics and those with less education are less satisfied with how much they are working

  66% of graduates with Batchelor’s degrees think their education investment paid off financially

  Just 30% who started toward a degree and did not finish agree with that assessment

  Over half of young adults that attended college took on debt to pay for that education

  Over a fifth that went to private-for-profit schools are behind on loan payments

  That compares to 8% of those that went to public institutions and 5% that attended private-not-for-profit schools

  On retirement, most adults are struggling to save for retirement

  36% of non-retired respondents think they’re on track

  25% have no retirement savings or pensions

  Even those with some savings have no clue how to make investment decisions

Click here for a link to a video summarizing the findings.

Click here for a news release on the report.

Source link PDF of the report: The Federal Reserve

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