Family Economics Review [1965, Number 2]

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-vMwI CSPROP ERTY OF THf UBR Y m JUN 14\
U'NIVE~w TY Of ~
AT REEN.::>L Q.-<0 Consumer and Food Economics Research Division, Agricul ural Research Servi•·••,
UNITED STATES DEPARTMENT OF AGRICULTURE f~m~Jrlilliiiiiili!!!!!j!H~ill~~1il~F~
A quarterly report on current developments in family and food economics and economic aspects
of home management, prepared for home economics agents and home economics specialists of
the Cooperative Extension Service.
CONTENTS
Regional Differences in Income, Savings, and Expenditures of Farm Families ........ .
Diet Quality Related to Food Expenditure and Income of Older Families ....... .... .. .
Prices in a Food Store Giving Trading Stamps ..................................... .
USDA Nationwide Food Consumption Survey ..................................... .
Assets of the Aged ............................................................ .
Old-Age Inshrance after 30 Years ............................................... .
College Education on Borrowed Money ......... ...... ...... . ...... ............... .
Farmers Heme Administration Employs Home Supervisors .... ............. ....... .
Educational Attainment Projections to 1985 .. .... ......... . ..... ......... . ..... . .
New Publications on Money Management ......... . ....................... · · · · · · · ·
Variations in Food Prices in One Shopping Area .............. . ....... · .. · · · · · · · · ·
Cost of Food at Home .............................. · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·
Consumer Prices .. . .. . .................... · .. · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·
ARS 62-5
June 1965
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REGIONAL DIFFERENCES IN INCOME, SAVINGS, AND
EXPENDITURES OF FARM FAMILIES
The average income after taxes of farm families in 1961 varied from $3,600 in the South
to $6,150 in the West (table 1) .1 Income in the South was 19 percent below the $4,400 average
of all U.S. farm families, in the West 39 percent above the average. The North Central and North­eastern
regions were relatively close to the national average--10 and 14 percent above it-with
average income per family of $4,900 and $5,050,1 respectively.
Table I.-Average income, outlays, and selected characteristics of farm families in the United States and four
regions, 1961
United North- North
Item States West east Central South
Dollars Dollars Dollars Dollars Dollars
Income after taxes _______________ :._ _________________ 4,424 6,149 5,057 4,878 3,592
Other receipts ------------------------------------- 98 119 93 125 71
Total outlays -------------------------------------- 4,533 6,285 5,129 4,974 3,717
Net change in assets and liabilities (savings) ______ 519 1,006 611 709 243
Personal insurance ------------------------------- 200 302 227 230 149
Gifts and contributions --------------------------- 220 455 238 224 168
Expenditure for current consumption -------------- 3,594 4,522 4,053 3,811 3,157
Account balancing difference 1 ----------------------- -10 - 17 21 29 -55
Characteristics of families:
Average family size 2 ----------------------------- 3.8 3.8 3.7 3.9 3.7
Average number of children under 18 years--------- 1.5 1.6 1.4 1.6 1.4
Percent homeowners, all year --------------------- 71 81 79 71 68
Percent auto owners, end of year ------------------ 91 97 95 96 85
Percent with persons 65 years and over ------------ 25 23 26 20 29
Percent with self-employed head ------------------ 69 81 68 78 59
Number in sample --------------------------------- 1,967 155 145 742 925
1 The difference between reported total receipts and reported total outlays. Negative when outlays exceed
receipts.
2 In year-equivalent persons.
The regions differed considerably in the pattern of their outlays2 as well as their incomes.
The Western region saved3 a larger proportion than any other region-16 percent-and used a
smaller proportion for current living expenses-72 percent (table 2). The high rate of savings in
this region is explained in part by the high level of income and the large proportion of self-em­ployed
(presumably farm operators) in its farm population. The higher the income level, the
larger the proportion of that income families usually put into savings. However, at any income
level, self-employed families will save more than those dependent on wages and salaries or other
sources of income.
In the North Central region the rate of saving was somewhat lower than in the Western, and
a somewhat larger proportion of total outlays went for current living. However, as compared
with the Northeastern farm families, theN orth Central ones saved more and spent less for living
(both in actual amount and as a percent of total outlay), even though their average income was
lower. This and other data suggest that the North Central region had a better than usual year
1 These data are from the 1960-61 Consumer Expend\ture Survey, a cooperative undertaking of tJ:e. U.~.
Bureau of Labor Statistics and the U.S. Department of Agriculture. Summary data for farm families m
1961 are published by the USDA in Consumer Expenditure Survey Reports 1 (Northeast), 2 (North-Central),
3 (South), 4 (West), and 5 (United States).
2 Total outlays rather than income after taxes are distributed here. Income after taxes ?oes not equal total
out.lays for two reasons: ( 1) "Windfall" receipts, such as inheritances and amounts received from msur~nce
cla1ms, are not included in income. (2) Reports of receipts and disbursements seldom balance ex;actly smce
most families do not have records covering all receipts and disbursements, and must depend to varymg extents
on memory.
. " (i.s. ~s~d here saving is a positive net change in. assets a~d l~ab~l~t~es-an increase in assets plus a decrease
In habJhtJes greater than the decrease in assets and mcrease m habihtles.
-4-
Table 2.-Distribution of total outlays and of expenditures for current consumption of farm families in the
United States and four regions, 1961
Item
Total Outlays -------- --------------------------------- ---­Expenditure
for current consumption --------------------­Net
change in assets and liabilities (savings) ------------­Personal
insurance --------- ----------------------------­Gifts
and contributions --- - ----------------------------- -
Expenditure for current consumption ----------------------
Food --------------------------------------------------­!
lousing - - ----------------------------------------------
Clothing ------------ ----------------------------------­~
edical care ------------------ ------------------------- ­Automobile
- ----------- ---- -----------------------------
All otherl ---------------- --- ---------------------------
United
States
Percent
100
80
11
4
5
100
24
25
12
9
16
14
West
Percent
100
72
16
5
7
100
23
25
13
9
15
15
North- North
east Central South
Percent Percent Percent
100 100 100
79 76 84
12 14 7
4 5 4
5 5 5
100 100 100
27 24 24
27 26 24
10 12 12
7 9 9
15 16 18
14 13 13
1 Includes tobacco, alcoholic beverages, personal care, recreation, reading, education, transportation other than
by automobile, and miscellaneous expenditures.
in 1961 and so families were able to maintain their usual level of living and save at a higher
than usual rate.
Farm families in the Southern region, having the lowest average income and the smallest
proportion of families who were self-employed, had the lowest savings rate--7 percent-and the
highest proportion of outlays spent for current consumption-84 percent.
Families in all four regions spent at about the same rate for personal insurance and for gifts
and contributions. Personal insurance averaged 5 percent of total outlays in the Western and
North Central regions, 4 percent in the Northeastern and Southern. Gifts and contributions took
5 percent, on the average, in all regions except the Western-where they took 7 percent.
The average amount spent for current consumption differed considerably among the re­gions.
As might be expected, it was highest in the Western region where income was highest. It
decreased in the same order that average income and outlay decreased-after the Western, the
Northeastern, the North Central, and then the Southern region.
In the Western and North Central regions a a new relationship, evident also in all regions in
the urban and rural nonfarm populations, appears: Expenditures on housing (including shelter,
fuel, utilities, household operation, housefurnishings, and equipment) exceeded expenditures on
food for the first time in survey data. In the Northeastern and Southern, housing and food took
approximately equal amounts. In past surveys food has always taken a larger part of the budget
than any other category. The change indicates a rising level of living, although greater stability
in prices for food than for other categories of current consumption is also a contributing factor.
Western farm families used a smaller proportion of their current expenditure for food than
did families in any other region. This was to be expected since the proportion spent on food
usually declines as total expenditures rise. In line with this and a relatively low level of home
production, Southern families might have been expected to spend a larger proportion on food
than any other region, but they did not. An average family size below that of all farm families
in the United States and a traditional diet that costs less than that of other regions account for
the relatively small expenditure for food in their budgets.
Southern and Western farm families spent proportionally less on housing (including all
housing items listed above) than did families in the other regions. Climatic demands in these
regions tend to be less than in the Northeastern and North Central regions.
The percentage of the budget used for clothing was about the same in all regions except the
Northeastern, as was also the percentage used for medical care. The lower percentage in this re­gion
may be due to the small size of the sample there.
Expenditures on automobiles took a larger proportion of total expenditures in the Southern
than in other regions. In recent years Southern families, behind those in other regions in auto­mobile
ownership, have been catching up. Their higher rate of car buying probably explains the
larger share of the budget going to automobiles.
-Jean L. Pennock
-5-
DIET QUALITY RELATED TO FOOD EXPENDITURE
AND INCOME OF OLDER FAMILIES
To learn more about the dietary problems of older people, the Consumer and Food Econom­ics
Research Division, USDA, conducted a food consumption survey of older households in Roch­ester,
N. Y. Those sampled were beneficiaries of Social Security's old-age, survivors, and dis­ability
insurance (OASDI) who maintained their own households and ate most meals at home.
Each household included a beneficiary at least 65 years old, who lived alone or with one other
person at least 55 years of age.
Although the survey showed that many older people selected good diets, quite a number had
diets that needed improvement. For example, less than one-half of the households had food sup­plies
that furnished in full the amounts of nutrients recommended by the National Research
Council (NRC). One-fourth had diets that failed to meet two-thirds of the NRC allowance in
one or more nutrient.
The nutritive quality of the diets of the OASDI families was closely related to their food
.expenditures. About 80 percent of the households spending more fo1· food than the cost of the
USDA liberal food plan had diets meeting the recommended allowances in full. Nearly 60 per­cent
of those spending less than the cost of the low-cost plan had diets that failed to meet even
two-thirds of the allowances (figure 1). On the other hand, a few households with liberal food
expenditures had poor diets and nearly one-tenth of those with low food expenditures had diets
meeting allowances in full. Evidently a nutritionally adequate diet is difficult but not impossible
to provide at costs below that of the low-cost plan.
Diet Qualify as Related fo
FOOD EXPENSE
*BELOW USDA LOW-COST 1'000 ,.t.AH.
0GitEATEit TPfAH &.18EitAL.•COST ,.LAH.
U.S. OEPARTlllEHT OF AGRICULTURE
LIBERAL 0
.;:;:;:;:;:;:;:;:;:;:; ... )00% of NRC Allowance
:::::::::::::::::::::: in all Nutrients IJJ 67-99% of NRC ln 1
:.::.::.::.:::.:.:;,:;,:;:,::.: or more Nutrients )
::::::::::: {But not below 67% in any
::::::::::::::::::::::;
2% ~) 7 % Under 67% of NRC
·: • l;in any Nutrient
AcltEATEit THAH LOW, LEU THAH LIIEitAL •COST ,.LAH.
OASOI 8EHEI'ICIAitY HOUSEHOLD.S, ltOCHESTEit, H.Y., lts7.
MEG, 64 ( 6) •.S754 AGRICULTURAL RESEARCH SERVICE
Figure 1.
Diets meeting allowances in full were a~most ~Y2 times as frequent i~ the high-income
households as in the low (fig. 2). In contrast, diets fmlmg !o n:eet even two-thirds of allow~n~es
were more than 2112 times as numerous in the low- as the h1gh-mcome households. The years m­come
was considered low if it was under $1,000 for one-person and under $2,000 for two-person
households. It was considered high if it was at least $2,000 for the one-person and $3,000 for the
two-person households.
Nearly one-half of the low-income households had food costing less than the USDA's low­cost
food plan. A fifth of the higher income households, who presumably could have afforded to
spend more, were also spending this little.
Diet Quality as Related to
-6-
INCOME
100% of NRC Allowance
in all Nutrients
67-99% of NRC in 1
r more Nutrients
(But not below 67% in any)
\Jnder 67% of NRC
in any Nutrient
* UHOER JJ,OOO FOit J AHO $2,000 FOR 2 MEMSEitS.
6 U,OOO I.HD OVER FOR J, Sl,OOO AHD OVER FOR 2 MEMSERS.
OASDI SEHEFICIARY HOUSEHOJ..DS, ROCHESTER, H. Y •• US7.
U.S. DEPARTMENT OF AGRICULTURE NEG. 64(6) 5753 AGRICULTURAL RESEARCH SERVICE
Figure 2.
Thus, it appears that some OASDI households need higher incomes to raise their food ex­penditures
to the level of the low-cost food plan below which an adequate diet is unlikely. Others
with seemingly sufficient income need guidance in managing their money to provide enough for
food, or need to be convinced that buying and eating nutritionally adequate food is important.
Still others spend enough for food, but need help in getting a good nutritional return on their
food money.
More data from this survey are published in "Food Consumption and Dietary Levels of Older
Households in Rochester, New York," by Corinne LeBovit and Dorothy A. Baker. USDA, Home
Economics Research Report No. 25, February 1965.
-Corinne LeBovit
PRICES IN A FOOD STORE GIVING TRADING STAMPS
Economists at the Rhode Island Agricultural Experiment Station recently studied the effect
on prices of giving trading stamps at retail food stores.' They made a case study of one retail
chain food store, in which they compared prices before and after trading stamps were intro­duced.
Prices of 185 items, a representative sample of the dry grocery items in the store, were
taken 3 months before and 8 months after the store added stamps. At the end of the period,
prices had risen 3.5 percent, on the average, after adjustment for the general rise in dry grocery
prices. When the redemption value of the stamps was subtracted, the average price rise was
2.02 percent.
Trading stamps cost the retailer about 2 percent of his gross sales. According to this study,
the cost was passed on to the consumer.
1 Bromley, James D., and Wallace, W. H. "The Effect of Trading Stamps on Retail Food Prices," Contri­bution
No. 1091, R. I. Agr. Exp. Sta., Kingston, R. I. 1965.
-7-
USDA NATIONWIDE FOOD CONSUMPTION SURVEY
A nationwide survey of eating habits in the United States is being made by the USDA's
Agricultural Research Service. Its purpose is to obtain information about the food consumption
patterns of both households and individuals and the nutrient levels of U.S. diets. Information
from the survey will be useful, among other things, as a basis for consumer education programs
and for farm and food policies.
The most recent previous national survey of household food consumption was made in the
spring of 1955. No nationwide survey of the food intake of individuals has ever before been
made. The survey of household food consumption-to be made in approximately 15,000 house­holds-
will cover four seasons, beginning with spring 1965 and continuing through winter 1966.
Plans call for visits to about 7,500 of the households in the spring and 2,500 in each of the other
3 seasons. Data on the diets of individuals-about 13,000 of them-are to be obtained in the
spring survey only.
The households selected for interviews will be a representative sample of U.S. housekeep­ing
families in each of the four seasons. The homemakers are being asked to give specific in­formation
about every type of food used in the household during the week preceding the inter­view,
including the quantity used, whether the food was purchased or obtained in other ways,
and the price paid for purchased food. Information is also being obtained about expenditures
for food eaten away from home, age and sex of persons eating from household food supplies,
their relationship to the household head, the number of meals eaten, and food management prac­tices
such as canning and freezing.
Information being obtained on the food intake of individual members of the households in­cludes:
The kinds and amounts of food eaten at home and away from home during the preceding
day, the time of day these foods were eaten, the place where food not taken from home was
eaten, and the cost of purchased meals and snacks eaten away from home.
The data obtained in the survey will provide information about the food consumption of
farm, rural nonfarm, and urban families in the four regions, and at different income levels.
The nutritive content of food consumed will be computed, and an appraisal will be made of
trends over the past three decades in food consumption and dietary patterns in the United
States.
The Agricultural Research Service is being assisted in the survey by the Economic Research
Service. The data are being collected by a private research firm, under contract with the USDA.
ASSETS OF THE AGED
How successful have the Nation's elderly been in saving for their old age? This is one of the
questions the Social Security Administration sought to answer in its 1963 Survey of the Aged,
in which a nationwide sample of aged couples and nonmarried men and women was interviewed.1
About 10 percent of the couples, 28 percent of the nonmarried men, and 26 percent <;>f the
nonmarried women among the aged ( 65 years and over) had no assets (table 1) . Only slightly
better off were 6 percent of the couples and about 12 percent of the nonmarried, with assets
valued at less than $1,000. On the other hand, a sizable group--40 percent of the couples and
about one-half that proportion of the nonmarried-reported assets totaling $15,000 or more.
The median amount of assets held by those reporting any was $13,000 for couples, and about
$6,900 and $6,800 for nonmarried men and women, respectively. "Assets," as ':ls.ed here, include
deposits in banks and savings accounts; U.S. Savings Bonds; market~ble secunties; the ~alu~ of
collectible loans to others; equity in a business, farm, or real estate mvestment; and eqmty m a
home.
Equity in a home represented a large share of the assets held by the aged, and ~as th~ only
asset some of them owned. When this equity was left out of the count! the proportion w1th no
assets increased to 23 percent for couples and 37 percent for nonmarned men and _women, and
the median value of assets was reduced to $6,200, $4,300, and $3,000 for the respective groups.
1 Findings of the 1963 Survey of the Aged: (1) "Assets of the Aged in 1962," Social Security Bul. PP· 3-13,
Nov. 1964; (2) "Potential Income from Assets," Social S ectM·ity Bul. pp. 3-11, Dec. 1964.
-8-
Table 1.-Assets, total and less equity in home, of couples and nonmart·ied men and women 65 years old and
over, by amount, 1962
Amount of assets
All ---------------------------­Zero
--------------------------
$1-999 -------------------------
1,000-1,999 ---------------------
2,000-2,999 ---------------------
3,000-4,999 ---------------------
5,000-9,999 ---------------------
10,000-14,999 -------------------
15,000 or more -----------------
Married
couples
Percent
100
10
6
5
3
7
16
14
40
Total assets
Non- Non-married
married
men women
Percent Percent
100 100
28 26
12 12
6 5
4 5
8 8
13 15
9 9
20 19
Total assets less equity
in nonfarm home
Non- Non-
Married married married
couples men women
""Percent P~t Percent
100 100 100
23 37 37
16 16 19
8 5 8
5 7 6
8 5 7
11 12 9
8 5 4
23 12 11
-----------------------------
Median:
$11,180 $2,900 $3,285 $2,950 $ 790 $ 610
13,000 6,920 6,820 6,180 4,270 2,950
For those reporting _________ _
For those with assets ________ _
Data from the survey were used to calculate how much the income of the aged would be in­creased
if it were possible to prorate their assets and the interest they could earn over their re­maining
lifetime. The asset principal plus interest at 4 percent a year was divided by the ex­pected
remaining years of life of the couple or individual. The result was added to the current
money income, less whatever amount was being received as income from assets, giving the total
"potential income."
Two calculations of potential income were made for each couple and nonmarried person­(
1) including equity in the home among the assets prorated, and (2) excluding equity in the
home. The latter seems a more reasonable method for general use, for if the home were sold the
amount of income needed for housing would increase. Rental costs tend to be higher than owner­ship
costs for a home that is clear of debt, as most of those owned by the elderly are.
Table 2 shows how much prorating their assets and using them up during their remaining
lifetime would have increased the incomes of the aged persons studied. (These figures are based
on the total number of aged couples and individuals, not just those with assets.)
Table 2.-Median actual and potential income of the aged
Potential income
Aged unit
Married couples ---------------­Nonmarried
men --------------­Nonmarried
women -------------
Actual
income
Dollars
2,875
1,365
1,015
Excluding
home equity
Dollars
3,130
1,560
1,130
Including
home equity
Dollars
3,795
1,845
1,395
The Bureau of Labor Statistics estimates that a retired city couple needs about $2,500 a
year to maintain a "modest but adequate" level of living. About 58 percent of the aged couples
could have provided for this standard with their actual incomes in 1963. Another 6 percent
could have met it by prorating their assets (other than equity in the house) and adding to their
actual income. This would still have left 36 percent with insufficient money to live independently
at the BLS "modest but adequate" level.
OLD-AGE INSURANCE AFTER 30 YEARS'
This year marks the 30th anniversary of the passage of the Social Security Act. During the
period since 1935 the programs established by the act have been expanded, and new programs
have been added. Millions of people have been helped financially through one or more of these
programs.
1 Data from HEW Indicators, pp. S-18, S-19, March 1965.
-9-
Undoubtedly the best-known of the social security programs is that providing incomes for
retired persons. At first known as old-age insurance, it provided only for retirement benefits for
workers in commerce and industry. When a 1939 amendment extended benefits to certain depen­dents
and survivors of these workers, it became old-age and survivors insurance. Now it is
old-age, survivors, and disability insurance (OASDI), and covers workers in nearly all kinds of
employment and self-employment.
The first monthly benefit checks paid under old-age insurance went out in January 1940.
At the end of June that year there were 222,000 beneficiaries, including 147,000 aged persons,
20,000 widowed mothers, and 55,000 children. The number receiving monthly payments under
this program has increased steadily, as coverage has been extended to more and more groups,
and the number of covered workers reaching retirements age has risen. During the first decade
(1940-1950) approximately 3 million beneficiaries were added, and during the second decade
(1950-1960) another 11 million (see chart below). By the end of June 1964, a total of 19.8 mil­lion
persons were receiving monthly payments. Of these, about 15.6 million were aged persons
receiving old-age (retired worker), wife's, husband's, widow's, widower's, and parent's bene­fits;
2.7 million were depend~nt children of deceased workers; 471,000 were widows with chil­dren
under 18; and 894,000 were disabled workers.
OASDI BENEFICIARIES
Receiving Monthly Payments
15 r--------
1950 1955 1960 1965
0.4SDf ... OLD- AGE, SURVIVORS, J.HO DISABILITY IHSUIU.HCE. HEW 0.4 TA AS OF JUHE )0.
U.S. DEPARTMENT OF AGR\CUL TURE NEG. 65 {5)-5779 AGRICULTURAL RESEARCH SERVICE
Monthly benefits paid under OASDI have increased as. the general price l~ve_l a:r;td the level
of living have risen. Average monthly payments to t~e vanous types of ~enefic1anes m 1940 and
1964 are shown below (no payments were made to d1sabled workers unbl 1957):
Beneficiary :
Retired workers
Retired worker and aged wife
Aged widow
Widowed mother, 2 children under 18
Disabled worker, wife under 65,
and 1 or more children under 18
Average monthly benefit
1940 1964
Dollars
22.60
36.40
20.30
47.10
Dollars
77.57
129.40
66.90
192.50
192.90
-Emma G. Holmes
-10-
COLLEGE EDUCATION ON BORROWED MONEY
Although more and more families consider a college education for each youngster to be a
part of their child-rearing expenses, many are unable to accumulate the funds necessary. In­creasingly,
loans are being used to· augment what funds they have and what the student can earn
from summer jobs, part-time work during the school year, and scholarships.
As the popularity of loans for college expenses has increased, the sources of such loans have
multiplied. The individual wanting to borrow would be wise to investigate several sources to find
one that gives him the most favorable terms.
The financial aid officer at a college or university-as well as the guidance counselor in the
high school-has information about loan programs. Application forms for loans are likely to
be available in the student aid office. It is wise to apply for loans the spring prior to the college
year in which the funds will be needed.
Information about some of the educational loans available is summarized below.
National Def ense Education Act.-Undergraduate students attending a college at least half­time
and demonstrating a need for help may borrow up to $1,000 per year, for a total of not more
than $5,000 borrowed. Graduate or professional students may borrow up to $2,500 per year for
a total of $10,000.
When the student finishes his education, he has a year of grace before he is expected to
start repayment. Annual interest of 3 percent on the unpaid balance begins at that time with up
to 10 years to repay. If the student enters the armed services or the Peace Corps, repayment
may be deferred up to 3 years and no interest is charged during that time. If the student teaches
full time after graduation in any public or nonprofit private school (elementary, secondary, or
college level), up to 10 percent of the loan may be cancelled for each year of teaching up to a
maximum of 50 percent of the loan.
Nurse Training Act of 1964.-Loans are granted to full-time students of nursing, either en­tering
or presently enrolled, in proportion to need. The maximum that may be borrowed is
$1,000 per year. If, after graduation, the nurse is employed in any public or nonprofit institu­tion
or agency, up to 50 percent of the loan repayment may be cancelled at the rate of up to 10
percent for each complete year of service.
Health Professions Educational Assistance Act.-A full-time student in a school of medi­cine,
dentistry, or osteopathy may apply for a loan of up to $2,000 per year, with no limit to the
total amount. Repayment is not expected until 3 years after the student completes his studies.
At that time, interest charges at the going Federal rate (now 4 percent annually) begin. Pay­ments
are suspended, and no interest accrued, during service in the Peace Corps or uniformed
services.
United Student Aid Funds, Inc.-Loan funds for USA Funds, Inc., are provided by com­mercial
concerns and participating educational institutions, but the loans are processed by banks.
The college must certify the student's standing and recommend the loan (with parent's or guar­dian's
approval). The student takes the application to a designated bank in his locality where
he signs a promissory note for the amount borrowed. Interest at 6 percent annually begins im­mediately,
but repayment of principal and interest is not required until the fifth month after
schooling is completed. Most repayment schedules are for 36 to 54 months.
Banks.-Many banks make educational loans "on your signature"-that is, without requir­ing
security. Amounts are borrowed as needed throughout the student's school years. The true
annual interest rate is often about 8 percent. Repayment installments start as soon as the loan
is made and usually run for the length of the student's schooling or 1 or 2 years beyond.
The borrower may be able to reduce the interest charges by depositing with the loan officer
collateral, such as securities, a deed to property, or a life insurance policy.
Federal savings and loan institutions.-Secured, partially secured, and unsecured educa­tional
loans are made by Federal savings- and loan institutions. Terms of the loans, such as
amount, interest rate, and repayment schedule, are arranged by each institution to suit the bor­rower's
needs.
Other loans.-Vsually the financial aid office of the college the student plans to attend has
information about other loan funds, such as those provided by the college, organizations, individ-
-11-
uals, and State and local governments. This office probably can direct students who are depend­ents
or survivors of military personnel to additional sources of funds.
Some parents who can qualify "borrow on their life insurance"-that is, borrow from the
life insurance company writing their policies. Others mortgage real estate. Relatively low inter­est
rates make these two sources of funds for college education attractive.
-Martha L. Garrison
FARMERS HOME ADMINISTRATION EMPLOYS HOME SUPERVISORS
The Farmers Home Administration is again providing home management help to many of
its borrower families in low-income areas. A newly employed staff of home supervisors will be
working out of county offices in 22 States where there are large numbers of low-income farm or
rural nonfarm families-including those in towns up to 2,500 population. The women chosen
for this job have been trained in home economics or social work or both. A large proportion of
them are Negroes, Spanish Americans, and Indians who will work with families in their own
ethnic groups.
The home supervisors will give top priority to working with families who have received
Economic Opportunity Loans, but will also work with families with farm ownership or operat­ing
loans from FHA. They will assist borrower families in making farm and home manage­ment
plans, and will make followup visits as needed to help individual families to carry out these
plans. Major emphasis will be placed on the needs of the children in the families. The home su­pervisors
will see that as many as possible are enrolled in Project Headstart programs, that
health needs are met, and that youngsters are encouraged and helped to stay in school. Emphasis
will also be placed on management of money and other resources, on home production and pres­ervation
of food for family use, on the use of USDA-donated foods, and on improvement of hous­ing.
The home supervisors will cooperate with workers in the Agricultural Extension Service,
public health, social welfare, and other local agencies concerned with low-income people.
Economic Opportunity Loans were provided for under the Economic Opportunity Act of
1964. They are made to low-income farm and rural nonfarm families for the primary purpose
of helping them to increase their earnings. Families may use the loan funds to buy livestock
or farm equipment, build and repair farm buildings, and buy and improve farmland. They
may also use them to carry out such enterprises as well drilling, roadside marketing, carpentry,
trucking, and home production of handicrafts. Loans have been made, for example, to buy a sew­ing
machine so a woman could earn money as a seamstress; to repair and modernize a house so
it would pass inspection for use as a boarding home for children; and to establish a home beauty
parlor. The Economic Opportunity Loans have a top limit of $2,500, payable in up to 15 years
at 41/s percent annual interest.
By providing management counsel to borrower families, FHA is helping them to make
profitable use not only of the loan funds they receive but of their other resources as well.
EDUCATIONAL ATTAINMENT PROJECTIONS TO 1985
The educational gap between men and women is expected to widen in the next 2 decades,
giving men a larger lead than before. Census Bureau projections indicate that by 1985 about
20 percent of the men and 10 percent of the women 25 years of age and over will be college
graduates (see table) .1 In 1960 about 10 percent of the men and 6 percent of_ the women had
completed 4 or more years of college, and in 1950 about 7 an~ 5 percent, re~pecbvely. The smal­ler
gain forecast for women between 1960 and 1985 reflects, m part, the h1gh drop-out rate for
women in the first 2 years of college.
The proportion of men and women with college degrees is highest in th~ 2~-to-2_9 a~e group,
where most who will complete 4 years of college have already done so. ~ro]ecbons md1cate t~at
about 25 percent of the men 25 to 29 years old will be college graduates m 1985, compared w1th
14 percent in 1960. Corresponding figures for women in this age group are 14 and 8 percent,
respectively.
1 Bureau of the Census Current Population Reports: Projections of educational attainment in the United
States, 1965 to 1985. Series P-25, No. 305 (April 14, 1965).
-12-
High school and co/.lege graduates in the population 25 years old and ove1·, by sex, 1940, 1950, 1960, and projec­tions
for 1985 1
Both sexes Men Women
High school Colleges High school College High school College
Year graduates2 graduates a graduates2 graduates a graduates2 graduates3
Percent Percent Percent Percent Percent Percent
1940 24.1 4.6 22.3 5.4 25.9 3.7
1950 34.3 6.2 32.6 7.3 36.0 5.2
1960 41.1 7.7 39.5 9.7 42.5 5.8
1985 62.5 14.3 61.9 19.4 63.1 9.7
1 Data from Bureau of the Census, Series P-20, No. 15 and P-25, No. 305.
z Persons who completed 4 years of high school or beyond.
~ Persons who completed 4 or more years of college.
In the past, girls have done somewhat better than boys at staying in school through high
school, but boys are improving their record. In 1960 about 43 percent of the women and 40 per­cent
of the men 25 years old and over had completed high school. Projections for 1985 indicate
that both will have made much progress, for about 63 percent of the women and 62 percent of
the men will be high school graduates.
Increases in educational attainment at these higher levels are expected to be accompanied by
a sharp reduction in the percentage of adults with little or no schooling. For example, although
about 8 percent of those 25 years old and over had less than 5 years of formal schooling in 1960,
only 3 percent will have this little by 1985 if projections turn out to be correct.
The median number of years of school completed by persons 25 and over was 10.5 in 1960,
and is expected to be about 12.3 or 12.4 in 1985. This improvement will occur as persons now in
the older ·age groups, whose level of schooling is relatively low, die and are replaced by persons
with more education. The chart illustrates this process of increasing median years of educational
attainment.
c
w
1- w
.-l a..
2
0 u
.-l
0
0 :z: u
"' u...
0
I"X' w""
>-
z
~
0 w
2
MEDIAN YEARS OF SCHOOL COMPLETED BY PERSONS 25 YEARS OLD AND OVER
IN THE UNITED STATES: 1960 AND PROJECTIONS TO 1970 AND 1980
16
+ L __ I __ I __ I __ I __ I __ I __ I __ I __ I __ I __ J 16
+
.---- -- -- -- -- -- -- -- -- -- ---
13 13
12
11
10
9
- =..- r=--~--f-------1---------- --~ ~--- ~-
r'\~ -'
,...,
' ' I' 1980\. r-.. "' ' ' '\. ' ' 1970' !', I'
~ ' ' ', ' '\.
f\.. ,, ]\.
'-r-- '"-- -. ............... '\.
1-- --
12
11
10
9
8
L_ __ -- -- -- -- -- -- -- -- -- -- 0[-,- I -,-I-,- I -,-I -,-I -,-I-,- I-,- I -,-I-,- I ·-,- l o
25·29 3().34 35·39 40·44 45·49 50·54 55·59 60-64 65·69 70-74 75 AND
OVER
AGE
-13-
These projections are indicators rather than predictions of future educational levels. They
assume that there will be no unusual political or economic changes and no extreme changes in
educational practices that might seriously affect patterns of educational attainment. The figures
would probably be very different if, for example, mass programs of free public higher education
were to become available throughout the country in the near future.
NEW PUBLICATIONS ON MONEY MANAGEMENT
Three publica~i~n~ on family money m~nagement, for use by low-income families, have been
prepared by the DivisiOn of Home Economics, Federal Extension Service, USDA. The titles are:
• Managing Your Money-a Family Plan. March 1964
• Understanding Life Insurance-for the Family. December 1964
• When You Use Credit-for the Family. January 1965
. ~.hese 3 publicat~ons are for sale by the Superintendent of Documents, U.S. Government
Prmtmg Offic~, Washmgton, J?.C., 20402_, for 10 cents each. Single free copies may be available
from the Agncultural ExtensiOn Office m the county where you live.
The Budget Standard Service of the Community Council of Greater New York has updated
the cost figures for its "Family Budget Standard" and published them in a manual entitled
"Annual Price Survey-Family Budget Costs, October 1964." This manual contains (1) a sum­mary
o.f the changes in the cost of the family budget standard since 1963; (2) revised cost tables
for the family budget standard; and (3) retail price lists for the various goods and services in­cluded
in the budget standard. Copies of the manual may be purchased for $2.00 from the Com­munity
Council of Greater New York, 225 Park Avenue South, New York. N.Y., 10003.
VARIATIONS IN FOOD PRICES IN ONE SHOPPING AREA
A study of food prices in two typical supermarkets in a shopping area serving middle-in­come
families in Greensboro, N.C., has been reported by the Economic Research Service, USDA.
To ascertain changes in prices during 3-month and 1-year periods, Tuesday and Friday prices of
about 115 items were examined in each of the stores. These items were representative of foods
commonly purchased by families. On the average, the prices changed 2.6 times per item during
the 3-month period. However, prices of nearly 4 out of 10 of the items did not change even once.
Although fresh products (perishables) made up only one-sixth of the total number of items
priced, they accounted for almost one-half of the price changes. Fresh products averaged 7.6
changes per item. Prices of some fresh items changed more than once a week-for example,
bacon, ground beef, pork chops, chuck roast, chicken, eggs, sweet potatoes, fresh tomatoes, cab­bage,
and lettuce. Variation in the price of chuck roast is illustrative of price movements among
fresh products. There were only 3 weeks during the year when the price of chuck roast stayed
the same Tuesday and Friday and was the same in both stores. Only on 4 other occasions­twice
on Tuesdays and twice on Fridays-was the price in the two stores the same. However,
the average prices for the year were about the same in both stores-58.2 ver·sus 58.3 cents for
Fridays, and 62.2 versus 63.9 for Tuesdays.
The family shopper can tell when to buy by studying the newspaper advertisements. For
example, one or the other of the two stores studied advertised chuck roast at "special" prices on
20 weekends of the year.1 Prices ranged from 33 to 49 cents a pound. If a family purchased 5
pounds each time chuck was "specialed," the bill would have been $39.30. If they had bought 5
pounds each weekend after the "special," the cost would have been $23 more, or $62.30.
To find out how the cost of a family's food would be affected by the choice of a store for
food buying, estimates were made of the cost per week of food for a family o~ four-a young
hus~and and wife and two pre-teenage children. Two m3;rket baskets were pnced-one. repre­sentmg
food in the USDA's low-cost plan, the other food m the mod~rate-cost plan.2 Prices on
Tuesdays and Fridays were averaged by month, for the 3-month penod.
1 Unpublished data furnished by John J. Galvin, Industry Economist, Marketing Economics Division, Economic
Research Service, USDA, Washington, D.C.
2 "Family Fooc!_Plans and Food Costs," USDA Home Economics Research Report No. 20, 54 pp. Nov. 1962.
-14-
Three estimates of the average weekly cost of these market baskets were made: One for each
store, using prices of national brands only for the branded items; and one using the lowest price
in either store among national and top-quality store brands. Fresh foods priceq were the same
for each estimate (see table below).
Estimated cost in two supermarkets of a weekly market basket for a family of 4, at moderate- and low-cost
levels, September-November 1962 1
Type of market Average
basket and store September October November 3 months
Dollars Dollars Dollars Dollars
Moderate-cost:
Store A ---------------------- 32.02 31.89 32.46 32.13
Store B ---------------------- 33.04 31.91 31.40 32.11
Shopping around ------------- 28.54 28.78 29.17 28.84
Low-cost: 2
Store A ---------------------- 20.63 20.62 20.99 20.74
Store B ---------------------- 20.83 20.40 20.35 20.53
Shopping around ------------- 18.16 18.26 18.64 18.34
1 Preliminary.
2 Quantities used in estimating the weekly cost of the low-cost plan are adapted to food habits of families
in the southeastern states.
There was some variation between stores in the average cost of the weekly market basket
each month; however, the average cost for the entire 3-month period was virtually the same in
the two stores. Hence, if a consumer bought in only one store, it would have made no difference
which she patronized. If, however, she patronized both, shopping for specials, she could have
cu.t her bill by about 10 percent.
-Rosalind Lifquist
Consumer and Marketing Service USDA
-15-
Cost of Food at Home1 Estimated jo1· Food Plans at Three Cost Levels, Mat·ch 1965, U.S. Average
Sex-age groups2
FAMILIES
Family of 2, 20-35 yearss -----------­Family
of 2, 55-75 yearss ------------
Family of 4, preschool children4 ______ _
Family of 4, school childrens ---------
INDIVIDUALS G
Children, under 1 year ---------------
1-3 years --------------------------
3-6 years --------------------------
6-9 years --------------------------
Girls, 9-12 years ---------------------
12-15 years -------------------~----
15-20 years -----------------------­Boys,
9-12 years ---------------------
12-15 years ------------------------
15-20 years ------------------------
VVomen, 20-35 years ------------------
35-55 years ------------------------
55-75 years ------------------------
75 years and over -----------------­Pregnant
-------------------------­~
ursing --------------------------
Men, 20-35 years ---------------------
35-55 years ------------------------
55-75 years ------------------------
75 years and over ------------------
Low­cost
plan
Dollars
14.60
12.10
21.30
24.60
2.90
3.70
4.30
5.20
6.00
6.50
6.90
6.10
7.00
8.30
6.20
6.00
5.10
4.70
7.40
8.60
7.10
6.60
5.90
5.60
Cost for 1 week
Moderate­cost
plan
Dolla1·s
19.50
16.50
28.30
32.80
3.80
4.80
5.80
7.00
8.00
8.80
9.00
8.10
9.60
11.00
8.20
7.90
6.90
6.10
9.60
11.10
9.50
8.80
8.10
7.80
Liberal
plan
Dollars
22.60
18.70
32.60
38.10
4.10
5.50
6.60
8.30
8.90
10.20
10.10
9.30
10.90
12.60
9.40
9.10
7.80
7.10
10.80
12.20
11.10
10.20
9.20
8.80
Low­cost
plan
Dolla1·s
63.40
52.70
92.40
106.60
12.60
16.00
18.80
22.60
25.90
28.30
29.70
26.40
30.50
36.00
26.90
25.80
22.10
20.20
32.10
37.10
30.70
28.60
25.80
24.10
Cost for 1 month
Moderate­cost
plan
Dollars
84.30
71.20
122.30
141.90
16.30
20.70
25.00
30.10
34.50
38.10
38.90
35.20
41.80
47.70
35.60
34.20
29.80
26.60
41.50
47.90
41.00
38.10
34.90
33.60
Liberal
plan
Dolla1·s
97.90
81.00
141.30
165.20
17.60
23.70
28.60
35.80
38.60
44.00
43.90
40.40
47.40
54.50
40.70
39.20
33.80
30.90
46.60
53.00
48.30
44.00
39.80
38.20
1 These estimates were computed from quantities in food plans published in Family Economics Review, Octo­ber
1964. The costs of the food plans were first estimated by using the average price per pound of each food
group paid by nonfarm survey families at three selected income levels in 1955. These prices were adjusted to
current levels by use of Retail Food Prices by Cities released periodically by the Bureau of Labor Statistics.
2 Age groups include the persons of the first age listed up to but not including those of the second age listed.
a Ten percent added for family size adjustment. For derivation· of factors for adjustments, see Family Food
Plans and Food Costs, HERR ~o. 20, Appendix B. ·
4 Man and woman, 20-35 years; children, 1-3 and 3-6 years.
5 Man and woman, 20-35 years; child, 6-9; and boy, 9-12 years.
G The costs given are for individuals in 4-person families. For individuals in other size families, the follow­ing
adjustments are suggested: 1-person-add 20 percent; 2-person-add 10 percent; 3-person-add 5 per­cent;
5-person-subtract 5 percent; 6-or-more-person-subtract 10 percent.
-16-
CONSUMER PRICES
Con.~umer Price Index for Urban Wage Earners and Clerical Workers
(including single workers) (1957-59=100)
Group
All items ----------------------------------------­Food
-------------------------------------------
Food at home -------------------------------­Food
away from home ------------------------
Flousing ----------------------------------------
Shelterl --------------------------------------
Rent ---------------------------------------
Flomeownership2 ---------------------------­Fuel
and utilitiesa ---------------------------­Fuel
oil and coal ---------------------------­Gas
and electricity --------------------------
I!ousehold furnishings and operations _________ _
Apparel and upkeep4 ---------------------------­Men's
and boys' -----------------------------­Women's
and girls' ---------------------------
Footwear -------------------------------------
Transportation ----------------------------------
Private --------------------- -----------------­Public
----------------------------------------
I!ealth and recreation ---------------------------
Medical care ---------------------------------­Personal
care --------------------------------­Reading
and recreation -----------------------­Other
goods and services" ----------------------
March
1964
107.7
105.7
104.0
114.7
107.1
108.4
107.5
108.9
107.3
106.1
107.1
102.8
105.3
105.2
102.1
110.7
108.9
107.4
118.3
113.1
118.7
108.7
113.6
108.5
1 Also includes hotel and motel rates not shown separately.
Jan.
1965
108.9
106.6
104.8
116.1
108.1
109.9
108.4
110.6
107.9
106.5
108.0
102.8
105.6
106.2
101.4
111.5
111.1
109.7
120.6
114.5
120.6
110.0
115.0
109.3
Feb.
1965
108.9
106.6
104.8
116.3
108.2
110.2
108.5
110.9
107.4
106.7
107.8
102.8
105.8
106.2
101.9
111.6
110.6
109.1
121.2
114.7
121.0
110.1
115.2
109.4
2 Includes home purchase, mortgage interest, taxes, insurance, and maintenance and repairs.
3 Also includes telephone, water, and sewerage service not shown separately.
March
1965
109.0
106.9
105.0
116.5
108.2
110.1
108.7
110.8
107.4
106.5
107.7
103.1
106.0
106.3
102.1
111.7
110.6
109.0
121.3
114.9
121.4
110.4
115.4
109.5
4 Also includes infants' wear, sewing materials, jewelry, and apparel upkeep services not shown separately.
5 Includes tobacco, alcoholic beverages, and funeral, legal, and bank service charges.
Source: Bureau of Labor Statistics, U.S. Department of Labor.
Index of Prices Paid by Farmers for Commodities Used
in Family Living (1957-59=100)
April Dec. Jan. Feb. March
Item 1964 1964 1965 1965 1965
All commodities ------------------ 105 105 106 106 106
Food and tobacco -------------- 107 108
Clothing ----------------------- 110 111
Flousehold operation ------------ 109 110
I!ousehold furnishings ---------- 96 96
Building materials, house ______ 101 101
Autos and auto supplies -------- 103 103
Source: U.S. Department of Agriculture, Statistical Reporting Service.
April
1965
106