Selected Findings from the Survey of Household Economics and Decisionmaking

1. Selected Findings from the Survey of Household Economics and Decisionmaking Dave Buchholz Federal Reserve Board Seventh Annual Financial Literacy Leadership Conference September 29, 2014 My comments today represent my own views. They do not necessarily represent the views of the Federal Reserve Board of Governors or its staff.

2. Full report available at federalreserve.gov

3. Major survey topics • Household Economic Well-Being • Housing and Living Arrangements • Credit Behavior and Access to credit • Savings • Education, Student Loans, and Job Readiness • Retirement Planning and Saving • Health Care Expenses

4. Well-Being

5. Household Economic Well-Being Which one of the following best describes how well you are managing financially these days? Asked of all respondents. n = 4,134

6. Which one of the following best describes how well you are managing financially these days?

7. Compared to five years ago (2008), would you say that you (and your family living with you) are better off, the same or worse off financially?

8. Saving

9. In 2012, about how much of your income did your household set aside as savings as a percent of your total gross household income (before taxes and deductions)?

10. Reasons for Saving “Which of the following categories, if any, are you saving money for? “ Asked of those who reported saving a positive portion of their income. n=2,270

11. If you were to lose your main source of income (e.g. job, government benefits), could you cover your expenses for 3 months by borrowing money, using savings, selling assets, or borrowing from friends/family?Those responding “Yes”

12. Ability to cover $400 expense Suppose that you have an emergency expense that costs $400. Based on your current financial situation how would you pay for this expense? Asked of all respondents. n = 4,134

13. Before 2008, did you or your household have any savings, including stocks, money in a savings account, or pensions? n=4,134

14. Of those who had had savings: “Since 2008, have you or your household had to use up some, nearly all, or all of your savings to pay for bills and expenses?” n=2,845

15. Retirement

16. Retirement planning by age How much thought have you given to the financial planning for your retirement? Asked of those not currently retired. n=3,163

17. Retirement planning by income Asked of those not currently retired. n=3,163

18. Retirement Asked of those not currently retired who have given at least “some” thought to retirement. n=1,766

19. Retirement savings types, by age Asked of those not currently retired. n=3,163

20. Have no retirement savings or pension:

21. Retirement and the Great Recession Among those not retired who had given at least “some” thought to retirement: Asked of those not currently retired who have given at least “some” thought to retirement. n=1,766

22. Not Just Lack of Retirement Savings(Just Broke?) Of those who report no retirement savings or pension: • 67% also said they didn’t regularly put money into savings account (vs. 47% overall) • 86% didn’t have 3 months’ rainy-day funds (vs. 58% overall)

23. Overall Financial Challenges

24. Self-described financial challenges “In a sentence or two, please describe the main financial challenges or concerns facing you or your family?” • 1,616 respondents indicated that they currently had none • 2,265 provided a written response

25. Self-described financial challenges Top Issues Among those who offered a response. n = 2,265

26. In a sentence or two, please describe the main financial challenges or concerns facing you or your family? Total Responses: 2,265