Family Economics Review [1985, Number 4]

              Editor
Marilyn Doss Ruffin
Managing Editor
Sherry Lowe
Editorial Assistant
Nancy J. Bailey
Family Economics Review is
published each quarter by the
Family Economics Research
Group. Agricultural Research
Service. United States
Department of Agriculture.
Washington. D.C.
The Secretary of Agriculture has
determined that the publication
of this pertodical is necessary in
the transaction of the public
business required by law of this
Department. Use of funds tor this
pertodical has been a pproved
by the Director of the Office of
Management and Budget
through March 31.1987.
Contents may be reprtnted
without permission. but credit to
Family Economics Review
would be appreciated. Use of
commercial or trade na mes
does not imply approval or con­stitute
endorsement by USDA
FamUy Economics Review is
tor sale by the Superintendent of
Documents. U.S. Government
Printing Office. Send subscrtp­tion
orders. change of address.
and single copy requests to
Supertntendent of Documents.
U S. Government Printing Office.
Washington. D.C. 20402. (See
subscrtplion form in back ol this
issue.)
Suggestions or comments con­cernmg
this publication should
be addressed to
Marilyn Doss Ruffin Editor.
Family Economics Review,
1985 No.4
Contents:
Time Spent in Sewing by Employed Women
Joan C. Court less
Adjustable Rate Mortgages: Consumer Information Needs
Carolyn E. Summers
Value of Food Used in Households With Elderly Members
Linda W. Ingwersen and Mary Y. Ham a
Abstracts
Uniform Marital Property Act
Your Home, Your Choice--A Workbook for Older People and
T heir Families
Macroeconomic-Demographic Model
Poverty Status of Persons and Families in 1983 •
Costs and Benefits of the Electronic Fund Transfer Act
Regional Research Report--Innovative Housing
BLS Consumer Expenditure Interview Survey Data Available
Child Support and Alimony
Regular Features
Some New USDA Publications
Cos t of Food at Home
Up dated Estimates of the Cost of Raising a Child
Consumer Prices
Agricultural Outlook '86 Program--Outlook for Families
Family Economics Research Group.
USDNARS. Federal Building.
Room442AHyattsville.Md. 20782 Issued October 1985
1
4
11
10
20
20
20
22
22
23
24
3
25
26
28
29
Uepository
p 0~ I .v OF THE
Time Spent in Sewing lPIIRARY
Employed Women .ocr 2 2 1985
By Joan C. Court less
Family economist .Umversity of North Carolina
at Green.boro
The increased labor force participation of
women may account for some of the decline in
the amount of home sewing that has taken
place over recent years (_~). The majority of
women who do sew, however, are employed
outside the home (1, 2). Although employment
limits overall time available for household
production activities, it may increase the
need for types of clothing that can be sewn
at home as well as purchased.
Home sewing requires a certain skill
level, a fair amount of space, and a period
of time relatively free of interruptions. It
involves planning, preparation, and shopping
prior to the actual sewing activity. Employed
as well as nonemployed women who are willing
to invest time and energy in attaining the
necessary competence, work space, sewing
tools, and materials may be motivated by the
sense of personal satisfaction sewing affords
them. Many women view sewing as a leisure
activity; sewing gives them a chance to be
creative and thus becomes a hobby rather
than a chore.
This article reports a special analysis of
time spent by employed women in sewing.
Background on the data, descriptive informa­tion,
and an analysis of factors associated
with time spent in the activity are
presented.
Data are from a study made by The Univer­sity
of Wisconsin-Extension, Department of
Agricultural Journalism, in cooperation with
the U.S. Department of Agriculture (USDA),
Extension Service. 1 The Family Economics
Research Group of USDA's Agricultural
Research Service provided partial support.
Time diaries and questionnaires covering
personal and demographic characteristics
were completed by 378 employed Wisconsin
1 For a detailed report on the study see
Diary Survey of Wisconsin and Illinois
Employed Women, Bulletin 41, by Helen Leslie
Steeves and Lloyd R. Bostian, The University
of Wisconsin-Extension, Madison.
,_ -_o _r 8 1ilding Use Only
and Illinois women in the fall and winter of
1978. Unmarried as well as married women
were included in the sample. The women
recorded time use in 30-minute intervals
over 7 consecuti. ve d ays. 2
Time Spent in Sewing 3
Only 55 of the 365 women (15 percent)
recorded sewing in their 7-day time diary. ,.
Three women reported that sewing was a
usual activity that did not take place
during the study week. Nearly 40 percent,
however, mentioned sewing as a hob by.
Apparently, many sewers do not sew every
week.
The median time that the sewers spent at
the activity during the diary week was
2 hours. One-fifth of the sewers, however,
recorded 6 hours or more of sewing during
the week.
About three-fifths of the women who sewed
performed the activity on 1 day only; more
than one-fifth sewed on 2 or 3 days. No
more than 20 women sewed on any 1 day of
the week (table 1). A few more women sewed
on Tuesday, Sunday, and Monday than on
other days. A shorter period of time was
recorded by sewers on Friday and Saturday
than on other days of the week. No dif­ferences
were observed in median time spent
on sewing by whether or not the day was a
working or a non working day.
2 The 30-minute recording interval,
although larger than is customary for time
diaries, was selected after pretesting
indicated it would be the smallest interval
that would result in satisfactory levels of
cooperation and completeness for a 7-day
study (8). Comparison of findings from the
Wiscons~- Illinois study with those of
other studies suggest that the results,
nonetheless, are similar (_~).
3 Sewing does not include mending or
shopping related to sewing. It does include
sewing for the home and home crafts such as
quilting and crocheting.
'+ Only 365 of the 378 cases were included
in this analysis because of incomplete or
miscoded responses.
1985 No.4 Fam il y Econom i cs Rev i ew 1
Table 1. Daily time spent in sewing, by day
of week
Day Percent Median
sewing hours
Sunday •••••••• 5 1-3/4
Monday •••••••• 5 1-1/2
Tuesday ••••••• 5 2
Wednesday ••••• 4 1-1/2
Thursday •••••• 2 2
Friday ••••••••• 4 1
Saturday •••••• 4 1
Characteristics of Sewers
Personal and demographic variables that
might affect time spent in sewing were iden­tified.
These variables generally related to
a woman's time demands, income level,
attitudes about her employment, or clothing
needs. 5 Statistical tests were carried out
to ascertain whether or not each variable
was related to weekly sewing time. 6 Only
four of the variables were found to make
statistically significant differences in
time for sewing: A sewing hobby, marital
status, husband's work shift, and own
income.
Women who named something related to
sewing among their first three hobbies spent
significantly more time in sewing than did
the remaining women. Having a sewing hobby
was the variable most strongly related to
sewing time (significant at .001 level).
Nearly 25 percent of women who had a sewing
hobby sewed during the week; the m~dian
5 Variables included her age, marital sta­tus,
and education; number of children;
number of children at home; number of
teenagers, age of youngest child; her own
income, occupation, hours on job, work
shift, future work plans, reason for
working, and preference to work or not
work; husband's income, hours on job, and
work shift; feeling rushed; "help" from
husband with household work; "help" from
children with household work; reading
fashion magazines; and a sewing hobby.
6 Kruskal-Wallis test, significant at • 05
level unless otherwise indicated.
2 Family Economics Review 1985 No.4
sewing time for these sewers was 2-1/4
hours, compared with 2 hours for all sewers
(table 2). The importance of the variable as
a determinant of home-sewing time supports
previous research (.!_, 1) that suggested that
sewing is more likely to be pursued by women
who find it to be a creative outlet than by
women who are motivated by economic
reasons.
Married women spent significantly more
time in sewing than did single, widowed, or
divorced women. Time in sewing did not vary
by whether or not these women had children
or by the number of children in the family,
an important variable when studying time
used for clothing care (_~) and other house­hold
tasks. Neither did home sewing time
vary by whether or not married women re­ceived
"help" with household work from their
husbands. One possible explanation is that
women who are not married may assume tasks
that might otherwise be done by husbands,
thereby increasing their workload to the
degree that sewing--whether motivated by
creative or economic reasons--becomes less
feasible. Except for marital status, charac­teristics
related to women's household work
load were not related to home-sewing time.
Women whose husbands had regular hours
of work were found to spend significantly
more time in sewing than women whose
husbands worked irregular hours or varying
shifts. Sewing time did not differ by the
time of day that the husband worked, how­ever.
Apparently, having a regular block of
time during which sewing can be scheduled is
conducive to spending time in the activity.
Table 2. Characteristics of women sewers
and time spent in sewing during diary week
Olaracteristic Percent Median
sewing hours
All women ••••••• 15 2
Married ••••••••• 18 2
Own income
under $8, 000 ••• 20 2
Husband works
regular hours •• 21 2
Sewing hobby •••• 24 2-1/4
Women with incomes under $8,000 (1978
dollars) spent significantly more time in
sewing than did women who earned over
$8,000. Husband's income was not related to
sewing time, however. Together these find­ings
suggest that items produced by home
sewing are substituted for items that might
otherwise be purchased from women's own
earnings. Such items could include household
items (for example, curtains) in addition to
personal and family members' wardrobe
needs.
Except for earnings level, no aspect of
women's employment was related to home­sewing
time. As in previous research (!),
no relationship was found between hours of
employment and time spent in sewing. Vari­ables
related to the employment situation,
such as occupation, work shift, attitude
about working, and future work plans, were
not related to home-sewing time.
SELECTED REFERENCES
1. Courtless, Joan C. 1982. Home sewing
trends. Family Economics Review
1982(4):19-22.
2. Homesewing Trade News. 1981. Consumers
say they sew for pleasure. December
issue, pp. 1, 14-16. Rockville Center, NY.
3. Manning, Sarah L. 1968. Time use in
household tasks by Indiana families.
Research Bulletin No. 837. Purdue
University Agricultural Experiment
Station, Lafayette, IN.
4. Sanik, Margaret M. 1979. A twofold com­parison
of time spent in household work
in two-parent, two-child households:
Urban New York State in 1967-68 and
1977; Urban-rural, New York-Oregon in
1977. [Doctoral dissertation.] Cornell
University, Ithaca, NY.
5. Sanik, Margaret Mietus. 1981. Division
of household work: A decade comparison--
1967-1977. Home Economics Research
Journal 10(2): 175-180.
6. Sew Business. 1981. Non-apparel items
now 30% of OTC market. Vol. 120, No. 9,
pp. 38-41. Sylvan Publishing, Inc.,
New York, NY.
7. Stafford, Kathryn. 1983. The effects of
wife's employment time on her household
work time. Home Economics Research
Journal 11(3):257-266.
8. Steeves, Helen Leslie and Lloyd R.
Bostian. [ 1980] Diary and Questionnaire
Survey of Wisconsin and Illinois
Employed Women. Bulletin 41. The
Department of Agricultural Journalism,
The University of Wisconsin-Extension,
Madison. In cooperation with the U.S.
Department of Agriculture, Extension
Service.
9. Walker, Kathryn E., and Margaret E.
Woods. 1976. Time Use: A Measure of
Household Production of Family, Goods
and Services. Center for the Family of
the American Home Economics Association.
Some New USDA Publications
The following are for sale from the Super­intendent
of Documents, U.S. Government
Printing Office, Washington, DC 20402,
202-783-3238.
1985 Fact Book of U.S. Agriculture.
Revised November 1984. Stock No. 001-
000-04432-0. $4.
A Profile of Female Farmers in America.
January 1985. Stock No. 001-019-00378-2.
$1.50.
Composition of Foods: Vegetables and
Vegetable Products, Raw ••• Processed •••
Prepared. August 1984. Stock No. 001-
000-04427-3. $16.
Dietary Levels: Households in the
United States--Spring 1977. March
1985. Stock No. 001-000-04438-9. $8.
Food Consumption, Prices, and
Expenditures: 1963-1983. November 1984.
Stock No. 001-019-00370-7. $4.50.
Single copies of the following are avail-able
from the U.S. Department of Agriculture,
Economic Research Service, Room 208,
1301 New York Avenue, NW., Washington, DC
20005-4788.
The Current Financial Condition of
Farmers and Farm Lenders. March 1985.
48 pp. AIG 490. Free.
1985 No.3 Family Economics Rev i ew 3
Adjustable Rate Mortgages:
Consumer Information Needs
and Recent Developments1
By Carolyn E. Summers
Economist 2
A variety of mortgage instruments, in­cluding
adjustable rate mortgages (ARM's).
allow families to tailor loans to their
specific needs and circumstances. 3 When
ARM's were first introduced in the early
seventies as alternatives to the tradi­tional,
fixed-rate, fixed-payment mortgage.
they were authorized under regulations that
specified the details of the new instru-ments
and placed heavy emphasis on consumer
safeguards and disclosures. Comparisons
were reasonably simple. With an increas-ingly
deregulated economy. however, regula­tory
changes gradually have granted lenders
more latitude in designing mortgage instru­ments.
Would-be borrowers now find a wide
variety of ARM's. Most lenders offer
several ARM's. and ARM's vary substantially
among lenders. Opportunities for borrowers
to choose among or even negotiate the
design of loans are balanced by new respon­sibilites
for borrowers to gather. under­stand,
and act upon large amounts of
complex information. This article describes
11 features that borrowers should consider
when gathering information and making an
ARM choice.
1 Information in this .article is based on
regulations and publications of the Federal
Home Loan Bank Board. the Comptroller of
the Currency. and the Federal Reserve
Board. as well as information from the
Federal National Mortgage Association, the
Federal Home Loan Mortgage Corporation,
the Mortgage Bankers Association, and the
National Association of Realtors.
2 Formerly with the Family Economics
Research Group. Agricultural Research
Service, U.S. Department of Agriculture.
3 The development of alternative mortgage
instruments has been discussed by the
author in several previous issues of Family
Economics Review--Fall 1978:8-16, 1982(4):
1-18, 1983(4):26-27, and 1984(1):7-16.
• Family Economics Review 1985 No.4
ARM FEATURES
Interest Rate
Interest charges on ARM's are computed on
the basis of the movement of an index plus a
margin or spread that is added to cover the
lender's business costs and profit. For
example, if the index is at 10 percent and
the lender's margin is 2 percentage points.
the rate would be 12 percent. If the index
rises to 12 percent. the ARM rate would
become 14 percent.
There are dozens of indexes that may be
used. each reflecting differing influences.
The index used must be one over which the
lender has no control and which may be
verified by the borrower. Although many
newspapers and popular publications are
beginning to print typical ARM indexes,
there is no single source of information for
would-be borrowers to review the movements
of all the possible indexes that may be used
by local lenders.
Indexes most typically used are U.S.
Treasury indexes, such as monthly average
yields on 1-year. 3-year. and 5-year U.S.
Treasury securities adjusted to cortstant
maturity; mortgage rates as measured by
the Federal Home Loan Bank Board's (FHLBB)
National Average Mortgage Contract Rate for
Major Lenders on the Purchase of Previously­Occupied
Homes; and national, regional, or
local cost-of-funds indexes that reflect what
banking institutions must pay to attract
deposits, such as the FHLBB's semiannual
National Average Cost of Funds to FSLIC­lnsured
Institutions. Longer term indexes,
such as mortgage rates and cost-of-funds
indexes, are less volatile than short-term
indexes. Payments on ARM's tied to long-term
indexes will rise less quickly than on ARM's
tied to short-term indexes wh~n general
rates in the economy are rising. but will be
slow to adjust downward when rates are
declining. Indexes reflecting banks' costs
of funds may rise even though the general
level of rates is declining because institu­tions
are having to pay more interest to
depositors as the industry is deregulated.
1
The overall interest cost of an ARM will
be determined by the pattern of index
changes over the term of the loan, the fre­quency
at which the loan rate is adjusted,
and the timing of the adjustments. Some-times
an average of several index readings
taken over a period of time is used as the
basis for adjustments. This provides a safe­guard
against tying rate and payment changes
to unusual behavior in an index that may be
captured by a reading on a given day.
Initial Interest Rate and Payment Levels
ARM's generally are priced lower than
fixed-rate, fixed-payment loans because the
borrower is bearing some or all of the risk
of inflation. In addition, lenders may offer
ARM's with initial interest rates and/or
payments that are reduced or discounted
below current ARM rates as an incentive to
accept these instruments. These reductions
may be achieved through discounts, buy­downs,
or graduated payment features.
Lenders typically offer discounted ARM's
that carry payments based on interest rates
that are lower than the sum of the pre­vailing
index rate and their margin. These
discounts may be in effect for 6 months, for
1 year, or for the first adjustment period
of the loan. For example, even though the
index is at 10 percent and the lender's
margin is 2 percentage points (making the
loan rate 12 percent), the interest charges
and payments for the first year on a 1-year
ARM may be based on a discounted rate of
9 percent. It is important to determine the
duration of the discount period and to real­ize
that payments will rise at the end of
the discount period whether or not the index
to which the loan rate is tied changes.
It is also important to determine whether
both payments and interest charges or just
the payments are being calculated on the
basis of the discounted rate. If both pay­ments
and interest charges are tied to the
discounted rate, the loan is being fully
amortized by the monthly payments. In some
cases, however, the monthly payments are
set by the discounted rate, but the interest
charges are based on the index plus the
margin. Negative amortization is built into
the loan. That is, the payments do not cover
the interest charges on the loan. The unpaid
interest is added to the outstanding princi­pal
balance, and the debt grows; the bor­rower
is charged interest on the deferred
interest.
Borrowers may assume a false sense of
security if they do not understand that the
discounts are temporary and that payments
can increase substantially at the end of the
discount. For those not intending to remain
in a home very long, though, discounted
initial payments and rate can be a major
plus in the choice of a loan. Even if the
advantage of the discount is substantially
offset by a large increase at the first
adjustment period, an ARM that is substan­tially
discounted in the first year could be
a reasonable choice. On the other hand,
short-term homeowners could realize a signi­ficant
loss of equity at the time of sale if
the payment reductions are achieved through
discounts involving negative amortization.
A buy-down is another method of achiev­ing
lower initial monthly payments and is
also sometimes used as a means to grant
loans to borrowers who otherwise would not
qualify under prevailing interest rates."
In a buy-down, a third party (typically a
builder) pays a fee to the lender to subsi­dize
the interest in the early years of the
loan. The fee paid by the third party covers
the difference between what the borrower
pays and the payments necessary to amortize
the 12 percent loan; negative amortization
does not take place. For example, an ARM
with an interest rate of 12 percent, adjusted
every 3 years, would be bought down so that
the borrower's payments in the first 3 years
were based on interest rates of 9, 10, and
11 percent in those years, respectively.
A graduated payment (GP) feature may be
added to an ARM as another method to
reduce initial monthly payments. In a
GPARM, initial monthly payments are set
below what would be dictated by the interest
rate on the loan and rise according to a
predetermined amount and schedule. Negative
"See "Creative Residential Finance,"
Family Economics Review 1984 No. 1,
pp. 7-16, by Carolyn Summers Edwards and
Isabelle S. Payton.
1985 No.4 family Econom ics Re v iew 5
amortization is built into GPARM's. If the
interest charges are tied to an index during
the graduation period and the index rises,
negative amortization is increased. If the
index drops, the built-in negative
amortization is offset.
Scheduling and Calculation of Interest Rate
Adjustments
The interest rate on an ARM may be
adjusted as frequently as monthly or as
infrequently as every 5 years. The frequency
of rate adjustments on ARM's linked to U.S.
Treasury indexes typically coincides with
the maturity of the security. For example,
ARM's linked to 1-year Treasury securities
are adjusted annually. ARM's that are
adjusted less frequently generally carry
higher interest rates. There is a price, in
other words, for the security of knowing
that the rate and payments will remain
constant.
It is important to determine the dates of
the first and subsequent rate adjustments
and, particularly in the case of loans with
discounts or buy-downs, how the new rate
will be determined. In the most basic ARM,
the initial interest rate is the contract
rate as determined by the index and margin.
If the index reading to be applied at the
first adjustment does not differ from the
contract rate, there is no change in the
rate or payments. If the index has risen or
fallen, the contract rate is increased or
decreased by the amount of that change, and
the payments are adjusted accordingly.
As mentioned earlier, with discounted
ARM's and buy-downs the interest rate and
payments will rise at the end of the
discount period even if the index has not
moved. The amount of that increase can vary
substantially depending on how the rates at
the first and subsequent adjustment periods
are determined. The new rate and payments
may be based on the margin and index in
effect at the time of adjustments or on the
margin and index prevailing when the loan
was originated. If the latter is used and
the index has declined, the built-in in­crease
due at the end of the discount period
is offset. If, on the other hand, the margin
and index prevailing at origination are used
as the basis for adjusting interest rate and
payments, an index decline would not offset
6 Family Economics Review 1985 No.4
the scheduled rate and payment increases. If
the index rises during the first adjustment
period, however, it would be preferable for
the new rate and payments to be tied to the
margin and index prevailing at origination.
It is very important for the borrower to
determine each lender's margin when compar­ing
discounted ARM's in which the first rate
and payment adjustment is based on the
margin plus index prevailing at time of
adjustment. Two loans, with the same initial
discounted rates and with subsequent inter­est
rates tied to the same index, eventually
can differ substantially in rates and pay­ments,
depending on the margin.
Limits on Interest Rate Adjustments
Caps that prevent the interest rate on
an ARM from rising or falling beyond a
specified level or by a specified amount
each adjustment period or over the life of
the loan (a feature required by the early
regulations) may be offered on some ARM's.
For example, adjustments may be limited to
2 percentage points per year or per adjust­ment
period and to 5 percentage points over
the life of the loan. Sometimes lifetime
caps are quoted as top and bottom limits,
such as a 12 percent ARM that can never
rise above 15 percent and never fall below
9 percent. In addition to shielding the
borrower from extreme payment changes,
interest rate caps allow the borrower to
calculate a "worst case scenario" and to
evaluate the potential risk involved.
Increases and decreases not taken in an
adjustment period because of the cap may be
carried over. For example, if the change in
the index warranted a 3-percentage-point
increase during an adjustment period but the
cap limited adjustments per period to
2 percentage points, the remaining percent­age
point could be applied in the following
period. As a consequence, the interest rate
on the ARM could rise in a period when the
index fell if increases carried over from
previous periods exceeded the index decline
in the current adjustment period.
It is important to determine to what rate
the interest rate cap applies. As in the
case of the calculation of interest rate
adjustments in the first period, this is
particularly true with ARM's carrying dis­counts
or buy-downs. The cap may apply to
the initial, discounted rate or the rate as
determined by the margin plus index rate
prevailing at origination. For example, a
2-percentage-point cap could be added to the
ARM discussed earlier. The loan rate of 12
percent (index of 10 percent and margin of
2 percentage points) was discounted to
9 percent. The rate and payments at first
adjustment are to be based on the margin and
index rate in effect at origination. If the
cap applies to the discounted rate of
9 percent and there has been no movement in
the index during the first period, the new
rate would be 11 percent. Although the end
of the discount would indicate an increase
to 12 percent (the index of 10 at origina­tion
plus the margin of 2), the cap limits
the increase to 2 percentage points. If the
index did not move again during the next
period, the interest rate would become 12
(the index of 10 plus the margin of 2).
Alternatively, if the cap applies to the
rate at origination of 12 percent rather
than to the discounted rate, the new rate at
the end of the first adjustment period would
increase from the discounted level of
9 percent to the rate of 12 percent, even
though the index had not changed. The
2-percentage-point cap would limit subse­quent
increases or decreases warranted by
changes in the index.
Limits on Payment Adjustments
Monthly payments may or may not be
adjusted at the same time or to the same
extent as interest rate adjustments. Payment
caps may be used to restrict the adjustment
of monthly payments to a less frequent
schedule than that used for the adjustment
of the interest rate. For example, the
interest rate may be adjusted annually, but
the payments may only be adjusted every
3 years. Alternatively, payment increases at
each adjustment may be restricted to a
certain level, such as 7-1/2 percent, even
if changes in the index call for higher
increases.
Payment caps offer a degree of certainty
regarding payment level. As in the case of a
GPARM, however, the payment-capped ARM
may amortize more slowly (negative amortiza­tion
takes place) or more quickly than
reflected by the payments, depending on the
movement of the index to which the interest
rate is tied. The advantage of the security
of steady or restricted payments could be
negated, however, by dramatic increases in
monthly payments that ultimately may occur
when payments are adjusted to reflect
accumulated changes in the interest rate or
growth in the debt due to negative
amortization.
Limits on Negative Amortization/Growth of
Principal
ARM's that involve negative amortization,
such as GPARM's and loans with payment
caps, typically limit increases in the prin­cipal
to 125 percent of the original loan
balance. For example, the limit would be
reached if payments on a $60, 000 ARM had
not risen sufficiently to prevent the debt
from rising to $75,000. If the maximum
balance were reached, the con tract might
require either that (a) payments be reset
to fully amortize the loan by the end of
the term, (b) a lump-sum payment be made,
(c) the loan be considered due, (d) the
loan be refinanced, and/or (e) the term
be extended.
Extension of Loan Term
Some ARM's have a provision that the loan
may be extended as an alternative to in­creasing
the monthly payments when the index
rises. Loans also may be extended as a means
of paying off increases in the loan balance
that have resulted from negative amortiza­tion.
Thirty-year loans generally can be
extended to a maximum of 40 years. Borrowers
need to determine whether or not this option
is available, and if it is, who makes the
decision to extend the loan term (borrower
or lender) and any costs that may be
involved. Although extending the loan can
be costly, it might be preferable to the
alternative of refinancing in the event that
negative amortization increases the balance
to the maximum amount.
1985 No.4 Family Economics Review 7
Conversion to a Fixed-Rate Mortgage
Some ARM's contain a provision that
permits the borrower to convert the loan to
a fixed-rate contract. Conversion may take
place only at preset times, such as after
the first, third, or fifth years. Conversion
can give the borrower the opportunity to fix
the interest rate and payments before
experiencing adjustments. The borrower
needs to determine (a) what, if any, costs
would be involved and (b) how the rate to
which the loan could be converted would be
determined--that is, a pre-specified rate,
the rate on the loan prevailing at the time
of conversion, or the rate prevailing for
fixed-rate contracts at the time of
conversion.
Assumption
In contrast with fixed-rate mortgages,
ARM's generally are assumable by qualified
borrowers. Because ARM's reflect current
market rates, lenders are not faced with the
risk of holding long-term, low-yielding
loans underwritten with short-term, higher
cost financing. Borrowers anticipating selling
in a short period of time would want to
determine what procedures and fees might be
required when passing the ARM to a buyer.
Depending on the movement of rates and the
features of the loan, an assumable ARM might
be an advantage in a subsequent sale.
Prepayment
Would-be borrowers should determine if
ARM's they are evaluating can be prepaid in
full or part without penalty. Prepayment may
arise when the borrower wants to sell the
home, finds that refinancing may be
desirable, or needs to alter the terms of
the loan because deferred interest has in­creased
the balance to the maximum allowed.
Points
Lenders charge points or discount fees
at the origination of home mortgage loans.
A point is equal to 1 percent of the loan
amount and is required at settlement. Some
lenders will allow the option of paying
points to reduce the interest rate on the
loan. Points are typically quoted separately
8 Family Economics Review 1985 No.4
as charges to the buyer and to the seller
but are a negotiable factor. Sellers may be
unwilling to pay points or may be less
willing to pay them than to negotiate a
lower sales price.
When comparing ARM's with varying fea­tures,
would-be borrowers should remember
that ARM's with many safeguards may also
require the payment of more points, making
such loans less of a bargain than they may
first appear. Points become a more impor­tant
factor, too, if the borrower expects to
hold the loan for only a short time.
RECENT DEVELOPMENTS
Would-be borrowers are less likely now
than in the past few years to find ARM's
that are deeply discounted with "teaser
rates" or that contain no protections. In an
effort to prevent defaults and foreclosures,
mortgage insurers and secondary-market
institutions are requiring more consumer
safeguards and are tightening the
requirements that prospective buyers must
meet to qualify for a loan. Market
experience with ARM's is revealing which
features and safeguards are important to
borrowers and lenders alike.
Effective ARM choices necessitate an
active role by the would-be borrower in
gathering information as well as in
understanding and acting upon that
information. Although that task never will
be an easy one, it is becoming more
manageable as agencies and organizations
involved in residential finance recognize
the importance of making information
available. Several publications designed to
provide would-be borrowers with information
to increase borrower understanding of
factors involved in the selection of a
mortgage now are available (see box on p. 9).
Increased concern about the adequacy of
information given by lenders to consumers
entering ARM agreements has prompted the
Federal Reserve Board to propose amendments
to Regulation Z (the implementing regula­tions
for the Truth-in-Lending legislation).
As Family Economics Review went to press,
there were three proposed amendments under
review that would provide more information
to consumers about ARM's and encourage
uniformity of disclosure requirements among
agencies.
The first proposed amendment would require
creditors to make informational materials
about adjustable rate mortgages available to
consumers. This information would illustrate
the important features of ARM's and would
alert would-be borrowers to important
questions to ask. The Consumer Handbook on
Adjustable Rate Mortgages developed by the
Federal Reserve Board and the Federal Home
Loan Bank Board, as well as booklets pro­duced
by the Federal National Mortgage Asso­ciation
and the Mortgage Bankers Association
(see box), would fulfill this requirement.
The second proposed amendment would
expand disclosure information currently re­quired
by Regulation Z. Would-be borrowers
currently receive standard Truth-in-Lending
disclosure information and only abbreviated
information on the variable-rate features of
a loan. The proposed amendment would re­quire
that disclosures include information on
the index, margin, and initial loan rate; the
frequency of rate and payment adjustments;
any rate or payment caps; and the possi­bility
of negative amortization. Any limits
on negative amortization would have to be
specified. If the loan contained no caps,
the disclosure would have to indicate that
there were no limits on potential increases
in rate and payments. A transaction-specific
example, based on the amount of the loan,
would have to show the effects on the
payment schedule of index changes, rate and
payment caps, and other features that could
affect payments. An illustrated payment
HOME FINANCING INFORMATION SOURCES
schedule assuming no changes in rates for
the term of the loan would be contrasted
with one assuming an increase of
2 percentage points in the index rate in
each of the first 3 years during which a
rate increase was permitted.
Finally, the third proposed amendment
would eliminate a provision, designed to
alleviate duplicative disclosures, that
permits creditors to substitute disclosures
required by other Federal regulators for the
variable rate disclosure required by the
Federal Reserve Board's Regulation Z. Under
current regulations, the nature and timing
of disclosures provided by various lenders
depends on which regulatory authority's (or
authorities') guidelines a lender must com-ply
with. The Federal Home Loan Bank Board,
the Comptroller of the Currency, and the
Department of Housing and Urban Develop­ment
each require disclosure of specific
variable rate features for institutions
under their jurisdiction. The disclosures
required by these agencies are far more
detailed than those currently required by
Regulation z. The proposed elimination of
substituting one agency's requirements for
another's reflects the Federal Reserve
Board's view that uniformity of variable
rate disclosures would better serve both
borrowers and lenders than the current
overlapping of Federal regulations. Other
agencies could continue to impose their own
disclosure requirements in addition to those
required by Regulation Z.
Mortgage Money Guide. Available for $0.50 from Consumer Information Center,
Pueblo, CO 81009.
Using Ads to Shop for Home Financing. Available (single copy free) from Federal
Trade Commission, Division of Credit Practices, Washington, DC 20580.
What You Should Know About ARMS and How to Shop For a Mortgage. Available
(single copy free) from Mortgage Bankers Association, Public Relations,
1125 15th Street, NW., Washington, DC 20005.
Fannie Mae's Consumer Guide on ARMS. Available (single copy free) from Consumer
Guide, Box 23867, Baltimore, MD 21203.
Consumer Handbook on Adjustable Rate Mortgages. Available (single copy free)
from Federal Reserve Board of New York, Public Information Department,
33 Liberty Street, New York, NY 10045; or Federal Home Loan Bank Board,
1700 G Street, NW., Washington, DC 20552.
1985 No.4 Family Econom i cs Rev i ew 9
Uni1orm Marital Property Act
The National Conference of Commissioners
on Uniform State Laws drafted the Uniform
Marital Property Act (UMPA), 1 which recog­nizes
the family as an economic unit and
requires the sharing between the spouses of
all property acquired during a marriage,
regardless of which spouse has earned or
assumed title to the property. In July 1983,
after 3 years of consideration, the commis­sioners
approved the UMP A and recommended
enactment by the States. The American Bar
Association approved UMPA a year later.
Under the UMPA, each spouse has one-half
interest in the marital property. Marital
property includes all forms of income
attributable to either spouse, ranging from
wages and salaries to income from trusts and
investments. Commingled or "mixed" property
is considered marital, except for individual
property that can be specifically traced.
Income produced from individual property
during marriage and appreciation of individ­ual
property that results from the efforts
of the other spouse are marital property. If
a question arises about the classification
of property, the act assumes the property is
marital; the spouse claiming individual
property must supply sufficient evidence to
support the claim.
Marital property does not include individ­ual
property that was acquired before the
marriage or before the UMPA became effective
in the State. Property brought into the
marriage is considered to be individual
property, unless the couple agrees to make
it marital property. An inheritance by a
spouse, a gift to a particular spouse,
recovery of damages for personal injury,
and appreciation of individual property
generally remain individual property.
1 A copy of the Uniform Marital Property
Act and additional materials can be obtained
for $2 from the National Conference of
Commissioners on Uniform State Laws, Suite
510, 645 North Michigan, Chicago, IL 60611.
10 Family Econom i cs Review 1985 No.4
Specific proVIsiOns of the act cover:
Credit. Since the act designates the
property that a creditor may use to
satisfy a debt, the non-wage-earning
spouse's opportunity to obtain credit
may be enhanced.
Divorce. Property division will con­tinue
to be governed by a State's
divorce statute. On a property inven­tory
developed for a divorce, however,
each spouse will have one-half interest
in marital property.
Death. The actual distribution of
marital property is governed by the
State's probate laws. Only a spouse's
share of marital property goes to his
or her estate, however. Spouses are
allowed to pass their shares in marital
property to each other without probate.
Gifts. UMPA limits gifts to third par­ties
from marital property by a spouse
acting individually to a small amount;
UMPA recommends a $500 limit.
Special provisions of the act also address
life insurance and deferred employment
benefits.
Under UMPA, management and control of
marital property generally is given to the
spouse whose name appears on the title
documents. If spouses jointly hold title to
certain property (Jane Doe and John Doe),
both must participate in its management and
control; however, if title is held in an
alternative form, either spouse may assume
that function. UMPA requires that all
marital property be managed in good faith
for the marriage. If it is not, the injured
spouse may recover from the spouse
responsible for the injury. Provisions
inhibit and restrain agreements that are
designed to avoid family responsibilities.
A third person acquiring property from a
spouse may rely upon the title document,
even if the other spouse's name does not
appear on the document or does not agree
to the transfer of ownership. In these
situations the injured spouse may not
recover from the third party.
A couple may develop its own alternative
marital property agreement. The agreement
must be in writing, signed, and in compli­ance
with other requirements in the act.
The UMPA is under consideration in several
States, having been introduced in 1985 in
the State legislatures of Connecticut,
Indiana, Michigan, North Dakota, and Ohio.
The State of Wisconsin has adopted the basic
UMPA provisions, and the property reform
provisions will become effective on
January 1, 1986.
Sources: National Conference of
Commissioners on Uniform State Laws, 1983,
Uniform Marital Property Act, as approved at
the annual conference meeting, Boca Raton,
FL; Uniform Law Commissioners, [no date],
The Uniform Marital Property Act: Questions
and Answers, Chicago, IL; Uniform Law
Commissioners, [no date], Summary: The
Uniform Marital Property Act, Chicago, IL.
Value of Food Used in
Households With Elderly
Members
By Linda W. Ingwersen
Home Economist
Human Nutrition Information Service
Mary Y. Hama
Economist
Human Nutrition Information Service
The well-being of the elderly depends on a
variety of factors--income, health, housing,
and preparation for retirement. Dietary
adequacy is another factor of major concern,
especially as more and more elderly maintain
their own households and, perhaps, eat
alone. These factors have become the focus
of many studies since an increasing
percentage of the U.S. population, now
about 12 percent, are 65 years or older. 1
1 U.S. Department of Commerce, Bureau of
the Census, 1985. State population estimates
by age and components of change: 1980 to
1984. Current Population Reports, Population
Estimates and Projections, Series P-25,
No. 970.
This article presents findings on the
money value, quantity, and nutritive value
of food used at home by 2, 066 households
that contained 1 or more persons 65 years of
age or older. Data are grouped first for all
households surveyed and then for two
categories of these households with elderly
members: (1) Those that achieved the 1974
Recommended Dietary Allowances (RDA) for
all of seven selected nutrients, and
(2) those that did not meet the allowances
for all seven nutrients. The nutrients were
protein, calcium, iron, vitamin A, thiamin,
riboflavin, and ascorbic acid. These nutri­ents
have been studied in previous USDA
food consumption surveys, and their content
in food is fairly well established. Fifty-six
percent of the sample households met the
RDA for all seven nutrients and 44 percent
did not.
Results show that such factors as
increased allocations of money for food, use
of larger quantities of food, and increased
care in the selection of foods providing a
well-balanced diet would benefit the elderly
household population. Selecting more milk
products and fruits and vegetables would
improve the nutrient content of elderly
household diets. Households meeting the RDA
for all seven nutrients spent more for home
food, used larger quantities of most kinds
of foods, selected a greater number of
foods, and had food supplies with higher
nutrient-to-calorie ratios for more nutri-ents
than did households not meeting the RDA
for all seven nutrients. The nutrient
returns per dollar as well as the nutritive
value per 1, 000 Calories for calcium and
vitamin A were lower among the households
that did not meet the seven RDA than among
those that did. About four-fifths of the
households grouped as not meeting the seven
RDA fell short of the recommendation for
calcium, one-half fell short for food
energy, and about one-third did not meet the
allowances for vitamin A and thiamin .
1985 No.4 Family Econom i cs Review 11
The Sample
Data were collected in a supplemental
survey to the Nationwide Food Consumption
Survey 1977-78 conducted by the U.S.
Department of Agriculture. 2 Information is
presented for housekeeping households 3
surveyed in the spring and summer of 1977
(April through September).~>
Interviews were conducted with the person
considered to be most responsible for food
planning and preparation in the household.
Trained interviewers used an aided-recall
questionnaire to obtain the kind (such as
ground beef and skim milk), the form (such
as fresh, canned, or frozen), the quantity,
and the cost, if purchased, of each food and
beverage used in the household during the
7 days prior to the interview. "Food used"
refers to all food that disappeared from
household food supplies during the 7-day
period, including food eaten by household
members and guests as well as that discarded
in the kitchen or at the table and leftovers
fed to pets.
A special measure, the 21-meal-equivalent­person,
was used to compare the values and
quantities of food used by households with
varying numbers of members who ate
different numbers of meals at home. An
equivalent-person equals 21 meals from home
food supplies, based on 3 meals daily for
a week.
Although households were the unit of
study, most consisted of an elderly person
living alone ( 42 percent) or with one other
member (43 percent) (table 1). In two­member
households, over one-half were
headed by an elderly man and an elderly
woman. Overall, the median age for male
heads was 70 years and the median age for
2 Robert L. Rizek, The 1977-78 Nationwide
Food Consumption Survey, Family Economics
Review, fall 1978, pp. 3-7.
3 Housekeeping households are defined as
households with at least 1 person having 10
or more meals from home food supplies during
the week prior to the interview. Four
percent of the sample were not housekeeping
households.
4 The survey was conducted from April 1977
through March 1978, but findings in this
article are based on spring and summer
1977.
12 Family Economics Review 1985 No.4
female heads was 69. Of the households with
one or two members, 57 percent met the RDA
for all seven nutrients; and of households
with three or more members, 48 percent met
the .H.DA for all seven nutrients.
The before-tax income reported by house­holds
for the previous year, 1976, averaged
$7,864. Nearly all, 96 percent, believed
they had enough food--76 percent said it was
the kind of food they wanted and 20 percent
said it was not. Few participated in the
Food Stamp Program or in Meals on Wheels.
Data relating to food practices showed
that nearly one-half of those surveyed did
major food shopping once a week and more
than one-fourth shopped more frequently.
About one-fifth shopped bimonthly or less
often. Major food shopping was done at
supermarkets by 91 percent and at small or
other stores by 9 percent of the sample.
The majority traveled by car to the store,
and fewer either walked or relied on others
for transportation. Public transportation,
taxis, or delivery services were rarely men­tioned.
Respondents generally indicated no
special problems associated with obtaining
their food--although sometimes they
mentioned the inability to go shopping alone
and to carry groceries. A lack of money or
distance from the store was occasionally
stated as a problem.
The two subpopulation groups (households
that met the RDA for seven nutrients and
households that did not) were similar in
size (number of members), distribution among
the four Census regions, 5 tenancy, race of
the respondent, and age of household heads.
Shopping practices and self-evaluations of
food also varied little. The household com­position
of the two groups was essentially
the same--nearly 50 percent were headed
jointly by a male and a female, 41 percent
were headed by a female only, and
10 percent by a male only. However, the
average incomes before taxes for the
previous year differed by $1,106--$8,341
for those who met all seven allowances and
$7,235 for those who did not meet the
allowances.
5 Northeast, North Central, South, and
West.
Table 1. Selected characteristics of households wtth an elderly member 1
Olaracteristic
Total households ••••••••••••••••••••••••••••.
Number of members in households :
1 .......................................... .
2 •••••••••••••••••••••••••••••••••••••••••••
3 .......................................... .
4 .......................................... .
5 .......................................... .
6 or more ••••••••••••..•.•••••••••••••••. ,.
Average number •••••••••••••••••••••••••• ,.
Region:
Northeast ••••••••••••••••••••••••.•••••.•••
North Central ••••••••••••••••••••••••••••••
South •••••••••••••••••.••.•••••••••••••••••
West ••••••••••••••••••••••••••.••.•••••••••
Urbanization:
Central city •••••••••••••••••••••••••••••..•
Suburban ••••••••••••••••••••••••••••••••••
Nonmetropolitan ••••••••.•••••••••••••••••••
Tenancy:
Owned •••••••••••••••••••••••••••••••••••••
Rented ••••••••••••••.••••••••••••••••••••••
Occupied, no rent ......................... .
Type of head:
Male and female head .•••••.••••••••••••••••
Female head only .......................... .
Male head only •••••••••••••••••••••••••••••
Median age of female head (years) ••••••••••••
Median age of male head (years) ••.•••••••••••
Household size in 21-meal-equivalent persons
Race of respondent:
White ••••••••••••••••••••••••••••••••••••••
Black ••••••••••••••••••••••••.••••••••• • • ••
Other ••••••••••••••••••.••.••••••••••••••••
Major food shopping frequency:
More than weekly ••••••••••••••••••.••••••••
Weekly •••••••••••••••••••••••••••••••••••••
Every other week ••••••••••.•••••••••••.•••
Monthly ••••••••••••••••••••••••••••••••••••
Never ••••••••••••••••••••••••••••••••••••••
Kind of store:
Supermarket .............................. .
Small store ................................ .
Other •••••••• •• •••••••••••••••••••.••••••••
Self-evaluation of food:
Enough, kind wanted ••••••••••••••••••••••.
Enough, not kind wanted ••••.••••••••••••••
Sometimes not enough ••••••••••••••••••••••
Often not enough •••.•••••••••••••••••••••••
Household money income before taxes, 1976 •••
Household income for the previus month ••••••
Money value of home food per 21-meal-equivalent
person ••••••••••••••.•.••••••••••
All
households 2
2,066
875
897
175
60
28
32
1.84
509
566
664
327
723
644
699
1,479
527
60
1,010
853
204
69
70
1.84
1,846
195
21
600
1,007
238
198
24
1,856
167
19
1, 572
412
59
18
7,864
639
16.85
Households Households not
meeting 7 Rll\ meeting 7 J:lQ\
- -Nu-mb-er- -
1,149
499
509
78
32
15
17
1.81
294
317
353
186
407
356
387
842
271
35
557
473
120
69
70
1.76
1,035
101
10
330
569
140
96
15
1,034
91
10
882
226
34
7
Dollars - - - - -
8,341
674
20.52
917
376
388
96
28
14
15
1.88
215
250
311
141
317
289
312
637
255
25
453
380
84
69
70
1.93
811
94
11
270
438
98
102
9
822
76
10
690
186
25
10
7,235
595
12.63
Households Households not
meeting 7 Rll\ meeting 7 Rll\
100
43
44
7
3
1
2
e>
26
28
31
16
35
31
34
73
24
3
90
9
29
50
12
8
1
90
8
1
77
20
3
1
Percent - - -
100
41
42
10
3
2
2
(')
23
27
34
15
34
32
34
69
28
3
89
10
30
48
11
11
1
90
8
75
20
3
1 Data from USDA Nationwide Food Consumption Survey 1977-78, Elderly supplemental sample, spring and summer 1977.
2 Some households did not answer certain questions, or the question did not apply to that household; therefore, number
differs from the total number of households (2,066). Parts may not total to the whole due to rounding.
3 Not applicable.
1985 No.4 Family Economics Review 1'
Food Used at Home
Elderly households averaged 1. 84 members
and $36.70 for a week's food. As shown in
table 2, this amount consisted of $30.96 for
food used at home plus $5.0 5 for meals and
$0.69 for snacks purchased and eaten away
from home. The value of food used at home
included actual purchases plus imputed
values for food that was home produced and
food that was received as a gift or in
payment for work.
The amount of food used in a week per
21-meal-equivalent-person included about
3-1 I 2 quarts of milk and milk products (in
terms of calcium content); 4-213 pounds of
meat, poultry, and fish; 6-112 pounds of
vegetables; 5-112 pounds of fruits, includ­ing
juice; 2-115 pounds of grain products
(in terms of flour content); more than
1 pound of sugar and sweets; and 3 I 4 of a
pound of fats and oils (table 3).
Households meeting the seven RDA were
smaller in terms of 21-meal-equivalent­persons
(1. 76) than were their counterparts
(1.93). They spent $20.52 per person for a
week's home food--about $8 more than the
$12.63 spent by the households not meeting
the seven RDA. Although households with
lower incomes generally devote a larger
proportion of their income to food than do
households with higher incomes. the house­holds
meeting the seven RDA averaged
higher income and devoted proportionately
more (23 percent) of their income to home
food than did those not meeting the seven
RDA (18 percent).
The food consumption practices of the two
groups differed substantially. The house­holds
meeting the seven RDA used larger
quantities of all major food groups and of
selected subgroups per person in a week.
For example, during the survey week these
households used the calcium eq uivilent of
nearly 2-112 quarts more milk; 1-112 pounds
more meat, poultry, and fish; about 2 more
large eggs; 3-112 pounds more vegetables;
3-112 pounds more fruits; and 1 pound more
grain products per person than did the
households not meeting the seven RDA.
Not only did the households that met the
seven RDA consume larger quantities of food
in a week, but also they used a greater
number of foods. Presumably, the inclusion
of a variety of foods helped them achieve
the allowances.
Nutrient Levels
Diet quality was determined by the levels
of food energy and 11 nutrients--the 7
previously mentioned, plus magnesium,
phosphorus, and vitamins 86 and 812-­present
in food reported by households.
Published food composition handbooks and
unpublished data served as the bases for
calculations of the nutritive value of the
edible portions of food used, with adjust­ments
for loss of vitamins during cooking.
Although nutrient data were limited for
some foods and for certain nutrients
(particularly magnesium, vitamin 8 6, and
vitamin B 12), the data used were con­sidered
the best available at the time of
the survey.
Table 2. Money value of food per household 1
Nurber of Total Food Food bought away fran hane
Household merri>ers 100ney at
value hane
Total Meals Snacks
All households ••••••••••••••• 1.84 $36.70 $30.96 $5.74 $5.05 $0.69
Meeting 7 RDA •••••••••••• 1.81 42.65 36.23 6.43 5.72 .71
Not meeting 7 RDA •••••••• 1.88 29.24 24.36 4.88 4.21 .67
1 Data from USDA Nationwide Food Consumption Survey 1977-78, Elderly supplemental
sample, spring and summer 1977.
14 Family Economics Review 1985 No.4
Table 3. Quantity of food used at home per person 1
Food
Milk, cream, cheese
(calcium equivalent) ••••••••••••••••
Meat, poultry, fish ••••••••••••••••••
Beef ••••••••••••••••••••••••••••••
Bacon •••••••••••••••••••••••••••••
Other pork ••••••••••••••.•••••••••
Luncheon meat .........••.........
Poultry .•......................•..•
Fish ••••••.••••••••••••••••••••••••
Other protein foods •••••••••••••••••
Eggs (fresh equivalent) •••••••••••
Dry beans, peas, lentils ••••••••••
Nuts, peanut butter •••••••••••••••
Vegetables .•••••••••••••••••••••••••
Potatoes (fresh equivalent) ••••••••
Dark green ..••.••••••.•....••...•.
Deep yellow •....•..•..............
Tomatoes ••••••••••••••••••••••••••
Fruits .. .....•........•.......•..•...
Citrus (single-strength
juice equivalent) •••••••••••••••••
Other ascorbic-acid-rich •••••••••••
Grain products (flour
equivalent) .•........•.........•.•..
Fats and oils ....................... .
Sugars and sweets ................. .
Sugar, syrup, jelly, candy ••••••••
Alcoholic beverages ••••••••••••••••••
All
households
7.38
4.68
1.78
.22
.70
.34
1.05
.39
1.20
.70
.13
.11
6.49
1.45
• 37
.38
1.02
5.47
1.77
.70
2.18
.74
1.10
.87
• 59
in a week 2
Households
IOOeting
7 .EID\
Pounds
9.79
5.37
2.02
.26
.81
.41
1.19
.45
1.41
.81
.14
.15
8.11
1.77
• 51
.49
1.28
7.10
2.11
.93
2.66
.90
1.33
1.06
.80
Households
not ~reet ing
7 liD\.
4.63
3.88
1. 51
.19
• 57
.26
.90
.32
.97
• 57
.12
.06
4.64
1.08
.21
.24
.71
3.59
1.39
.44
1.64
• 55
.84
.65
.35
1 21 meals from household food supplies equivalent to 1 person. Average value per person
is calculated using population ratio procedure.
2 Data from USDA Nationwide Food Consumption Survey 1977-78, Elderly supplemental
sample, spring and summer 1977.
1985 No.4 family Economics Review 15
The nutritive value of the household food
supply was compared with recommended
amounts of nutrients according to the sex
and age of persons eating in each household.
The 1974 Recommended Dietary Allowances
were the standard used to assess the diet
quality of the household food supply. The
RDA were designed to maintain good nutrition
in essentially all healthy persons in the
United States. Although a home food supply
may meet the RDA for a nutrient, the diet of
a member living in the home may not. This is
because we do not know how the household
food was divided among its members. However,
if the household diet does not meet the RDA,
some of the household members, if not all of
them, have diets that do not meet the RDA.
Failure to meet the RDA for one or more
nutrients does not necessarily indicate
either poor food practices or malnutrition.
Elderly households apparently had less
difficulty in· meeting the allowances for
protein, iron, phosphorus, riboflavin, and
ascorbic acid (met by 92 percent or more of
the households) than for calcium and vitamin
B5 (met by less than 65 percent) (table 4)
Food supplies of 73 percent of the house­holds
with at least one elderly member
contained energy sufficient to meet the
allowances.
Notable differences existed in the nutri­tive
value of the food supplies used by the
two groups of elderly households. The wider
selection and greater use of foods by the
households that met the seven RDA enabled
them to do better nutritionally than the
households that did not meet the seven RDA.
The home food of the households meeting the
seven RDA provided nutrients in amounts
sufficient to enable 92 percent or more to
attain the allowances for food energy,
magnesium, phosphorus, and vitamin B12•
and for 80 percent to attain the RDA for
Table 4. Households using food that met 197 4 Recommended Dietary Allowances 1
Nutrient
Food energy ••.••.•••••....•.•••
Protein •.....•.•.•..............
Calcium ••••••••.•.•..•..•.•••..
Iron .......•..•....•.......•...
Magnesium ••••• •••••••••••••••••
Phosphorus . •...••..•...........
Vitamin A .••.••....•••••.•••••.
Thiamin •••.•••................•
Riboflavin •...•.•.....•••.......
Vitamin s 6 .•.•••..•••.••.•....•
Vitamin B 12 •••••.••...•••.•••••
Ascorbic acid ••••••••••••••••••
All 7 nutrients 2
••••••••••••••••
All 11 nutients 3 ••••••••••••••••
All
households
73
95
64
92
71
95
83
86
94
57
77
93
56
41
Households
~rnet ing 7 liD\
Percent
93
100
100
100
93
100
100
100
100
80
92
100
100
74
Households not
~rnet ing 7 liD\
48
88
19
82
44
90
62
68
86
28
57
85
0
0
1 Data from USDA Nationwide Food Consumption Survey 1977-78, Elderly supplemental
sample, spring and summer, 1977.
2 Protein, calcium, iron, vitamin A. thiamin, riboflavin, and ascorbic acid.
3 Nutrients listed in footnote 2, plus magnesium, phosphorus. vitamin Bs, and vitamin B 12.
16 family Economics Review 1985 No.4
vitamin 85. Households meeting the seven
RDA had considerably more Calories and gen­erally
more nutrients (particularly calcium
and vitamin A) per 1, 000 Calories than the
households that did not meet the RDA for
these seven nutrients. Perhaps their use of
larger quantities of such nutrient-packed
foods as milk and milk products, vegetables,
and fruits contributed to more nutrient­dense
diets.
Households not meeting the seven RDA most
frequently achieved the RDA for phosphorus,
followed by protein, riboflavin, and a!?cor-bic
acid. Many of these households lacked
recommended amounts of food energy and
several nutrients. Generally, when food
energy is in short supply, nutrients are
also. The food supplies of 1 in 2 households
failed to provide the RDA for food energy
and magnesium, 3 in 4 were short of the RDA
for vitamin 85, and 4 in 5 were short
in calcium. Two percent had food supplies
short of the RDA for all seven of the
selected nutrients. When levels of nutrients
in household diets were compared with 80
percent of the RDA rather than 100 percent,
about 1 in 4 of the households not meeting
the seven RDA still failed to meet the lower
standard for food energy and vitamin 8 12,
3 in 10 were short in magnesium, and 1 in 2
were short in calcium and vitamin 86.
Thus, many did not attain 80 percent of the
RDA for several nutrients.
Nutrient Returns per Dollar
The money value of home food usually
affects nutrient returns per dollar. As a
group, households with lower money values
per person typically receive greater returns
per dollar than do those with higher money
values. Varying food prices, as well as food
selection and consumption practices, also
may influence the quantity of nutrients
acquired from a dollar's worth of food.
The returns per dollar for several nutri­ents
(table 5) were lower, however, among
the households not meeting the seven RDA
than among the households meeting the seven
RDA despite the $8 less they spent per
person for food. Returns may have been
lower than expected because the amounts of
Table 5. Nutrients per dollar's worth of home food 1
Nutrient
Food energy (Cal) ••••••••••••••••••
Protein (g) ..•.....•....•...•.......
Calcium ( mg) .•..•...••..........•.•
Iron (mg) ......................... .
Magnesium ( mg) ••••••••••••••••••••
Phosphorus (mg) •••••••••••••••••••
Vitamin A (IU) .•.....•.••••......••
Thiamin (mg) ....••.•••...•....•.••.
Riboflavin (mg) ................... .
Vitamin 86 (mg) •••••••• • • • • • • • • • • • •
Vitamin 812 (meg) •••••••••• • • • • • • • •
Ascorbic acid (mg) •••••••••••••••••
Households
meeting 7 Rll:<\.
Households not
meeting 7 RDA
Amount of nutrients
1,175 1,187
41.2 42.6
449 377
8.3 8.4
173 170
730 704
4,049 3,447
.77 .77
1.06 1.01
.92 .91
2.56 2.38
66 60
1 Data from USDA Nationwide Food Consumption Survey 1977-78, Elderly supplemental
sample, spring and summer 1977.
1985 No.4 Fam i ly Economics Review 17
food used by these households were small.
Evidently, the foods selected were not
nutritious enough to offset the small
quantities.
Notable differences in nutrient returns
per dollar resulted for two nutrients-­calcium
and vitamin A. Households not
meeting the seven RDA received 72 milligrams
less calcium per dollar than did their
counterparts, probably because they allotted
$1. 30 less per person for milk products
(table 6) and used 5 pounds less (table 3).
The households not meeting the seven RDA
had 602 I U less vitamin A per dollar than
did households that met the seven RDA, re­lating
perhaps to their use of 7 pounds less
vegetables and fruits per person in a week.
Although the dollar spent by both groups
purchased similar returns of food energy,
iron, magnesium, thiamin, and vitamin B5,
many households that did not meet the seven
RDA failed to attain the allowances for
these nutrients. This may be attributed to
several factors including the small quantity
of food used, the type of food selected, and
the lower expenditure for food. If they had
spent additional money in the same manner,
it is likely that more households would have
achieved the allowances for these nutrients.
However, increased spending alone likely
would not have alleviated the shortages of
calcium and vitamin A.
Home Food Dollar
The food spending patterns of the two
groups were dissimilar (see figure below).
Allotments of the home food dollar to
various food groups differed, as did also
the actual amounts represented by the
shares. Perhaps their different allocations
for vegetables and fruits; milk and milk
products; and meat. poultry, and fish partly
were responsible for the disparity in the
nutritive value of their diets. For example,
the households that did not meet the seven
RDA devoted 2 cents less per dollar to vege­tables
and fruits than did other households.
This 2 cents per dollar represented $2.22
less in actual value and purchased 7 pounds
less of fruits and vegetables per person per
week. Many fruits and vegetables are known
to be good sources of vitamin A and ascorbic
Share of Home Food Dollar in Households with Elderly Members
Mllk, cream,
chee••
12.5"
Other protein
food
4.4~
rat.. oila,
8UjJar8
5.8~
Households meeting all 7 RDA 1
Grain _/
froducb
1.2~
Meat, poultry,
fish
31.0~
1Proteln. ccalclum. Iron. vitamin A. thiamin, r111oflavln. and a-rlllo acid.
Households not meeting RDA for
1 or more of 7 selected nutrients 1
Milk, cream.
che•••
10.1%
Other prot.in
food
4.6"
F'ab. oila,
eugare
5.6X
Grain
producta
11."'
Meat, poultry,
fleh
35.7~
Source: USDA Nf'CS 1171-71, E.lder1y Supplemental SGmple, 8pr1ng and •ummer 1171.
18 Family Economics Review 1965 No.4
Table 6. Money value of food at home per person1 in a week 2
Food All Households Households not
households meeting 7 lUl4. meet ing 7 fiD<\
Milk, cream, cheese ........................ .
Meat, poultry, fish ••••••••••••••••••••••••••
Beef ••••••••••••••••••••••••••••••••••••••
Bacon •••••••••••••••••••••••••••••••••••••
Other pork ••••••••••.•••••••••••••••••••••
Luncheon meat ••••••••••••••••••••••••••••
Poultry ••••••••••••••••••••••••••••••••••• :
Fish •••••••••••••••••••••••••••••••••••••••
Other protein foods •••••••••••••••••••••••••
Eggs ••••••••••••••••••••••••••••••••••••••
Dry beans, peas, lentils •••••••••••••••••••
Nuts, peanut butter •••••••••••••••••••••••
Vegetables ••••••••••••••••••••••••••••••••••
Potatoes •••••••••••••••••••••••••••••••••••
Dark green •••••••••••••••••••••••••••••••
Deep yellow •••••••••••••••••••••••••••••••
Tomatoes ••••••••••••••••••••••••••••••••••
Fruits •••••••••••••••••••••••••••••••••••••••
Citrus ••••••••••••••••••••••••••••••••••••
Other ascorbic-acid-rich •••••••••••••••••••
Grain products ••••••••••••••••••••••••••••••
Fats and oils ••••••••••••••••••••••••••••••••
Sugars and sweets ••••••••••••••••••••••••••
Sugar, syrup, jelly, candy ••••••••••••••••
Miscellaneous ••••••••••••••••••••••••••••••••
Alcoholic beverages •••••••••••••••••••••••
$1.96
5.50
2.18
.29
.92
.44
.78
.60
.75
.35
.09
.13
2.35
.26
.18
.12
.46
1.62
.44
.16
1.88
• 54
.85
.42
1.40
.43
$2.57 $1.27
6.37 4.51
2.47 1.84
.33 .24
1. 07 .75
.54 .34
.88 .66
.70 .50
.90 • 58
.40 .29
.10 .07
.19 .07
2.94 1.67
.31 .20
.24 .11
.16 .08
.58 .33
2.06 1.11
.53 .34
.20 .12
2.30 1.40
.65 .40
1.03 .65
.53 .30
1.72 1.04
• 58 .26
1 21 meals from household food supplies equivalent to 1 person. Average value per person is calculated using
population ratio procedure.
2 Data from USDA Nationwide Food Consumption Survey 1977-78, Elderly supplemental sample, spring and summer
1977.
acid--nutrients in shorter supply among
these households. This group devoted a
larger dollar share than did households
meeting the seven RDA to meat, poultry,
and fish (36 and 31 cents, respectively).
Despite this, they actually spent $1.86 less
and used 1-1/2 pounds less per person. The
meat, poultry, and fish group often
contributes much protein, iron, and B
vitamins to the diet.
The smaller per dollar allotment made by
the households not meeting the seven RDA
(10 cents) than by the households that met
the seven RDA (12. 5 cents) for milk and milk
products represented an actual difference of
$1.30. Only one in five of the households
that did not meet the seven RDA had food
supplies that provided the RDA for calcium.
Although milk is an excellent source of
calcium, it may be regarded by some as
difficult to digest, expensive to purchase,
and a problem to store. Other foods that are
important sources of calcium include green
and leafy vegetables, dried beans, and grain
products.
1985 No.4 Family Economics Review 19
Your Home, Your Choice-A
Workbook for Older People and
Their Families
Your Home, Your Choice--A Workbook for
Older People and Their Families was devel­oped
by the American Association of Retired
Persons in cooperation with the Federal
Trade Commission to help older people choose
appropriate living arrangements as their
requirements change. The workbook is
designed to encourage people to plan for and
make informed decisions about altered cir­cumstances
and future housing needs. Topics
covered include support services and home
adaptations that can make it possible to
remain at home; alternatives to living
alone; and supportive housing such as nurs­ing
homes, board and care homes, congregate
housing, and continuing care retirement
communities. Each chapter concludes with a
list of questions to ask before making a
decision. An informative resource section
lists private and public agencies and orga­nizations
tl:lat assist the elderly and
suggests additional references on housing
alternatives. The 32-page booklet is
available free from the Consumer Information
Center, Pueblo, CO 81009 (303-948-3334).
Macroeconomic-Demographic
Model
Population aging will be a significant
factor in the future evolution of our econ­omy,
affecting productivity, consumption,
savings, and investment as well as the
income level of the elderly population.
A long-term Macroeconomic-Demographic Model
of the U.S. economy was developed for the
National Institute on Aging (NIA) for use in
assessing how the changing age structure of
the population and its economic consequences
will affect retirement income.
The NIA Macroeconomic-Demographic Model
combines a population model with a macro­economic
growth model and a disaggregated
labor market model, which together comprise
the core modeling system. The Population
Model uses a large amount of demographic
information to project the working-age and
20 Family Economics Review 1985 No.4
retired populations to the year 2055, given
specified fertility rates, mortality rates,
and immigration levels. The Macroeconomic
Growth Model and the Labor Market Model
work together to project levels of economic
activity and labor market outcomes for 22
sex-age groups. The information provided
by the core modeling system is applied to
the simulation of three pension system
models (Social Security, private pension,
and public employee pem;iion) and two
income transfer models (Supplemental
Security Income and Medicare).
The Macroeconomic-Demographic Model
enables researchers and policymakers to
examine a wide range of income security
issues within a single model. The model is
a useful tool in long-term projections and
analyses and in highlighting problems in
meeting public and private commitments to
the elderly. The Macroeconomic-Demographic
Model currently is being used in analyses
for the Federal Government.
Source: U.S. Department of Health and
Human Services, 1984, The National Institute
on Aging Macroeconomic-Demographic Model,
NIH Publication No. 83-2492.
Poverty Status of Persons and
Families in 19831
The poverty rate for 1983 did not differ
significantly from that of 1982.Z In 1983,
15. 2 percent of the population ( 3 5. 3 million
people) were living in poverty compared with
15.0 percent (34.4 million people) in 1982.
The stability of poverty rates over the
1982-83 period is also evident in the
experiences of most major subgroups of the
population (see table on p. 21).
About 7.6 million families were living in
poverty in 1983, not significantly different
from the 1982 level. The number of poor
unrelated individuals, however, rose signif­icantly
from 6. 5 million to 6. 8 million. The
1 For information on measuring poverty, see
"Measuring Poverty," Family Economics Revie~
1984(2): 9-13, by Daniel H. Weinberg.
2 Ninety-five-percent confidence level used
throughout except where otherwise noted.
Persons, famtlies, and unrelated individuals below the poverty level in 1983 1
Characteristic
All persons ••••••••••••••••••••••••••••••••••
White •••••••••••••••••••••••••••••••••••••••
Black •••••••••••••••••••••••••••••••••••••••
Spanish origin 2
••••••••••••••••••••••••••••••
Under 15 years ••••••••••••••••••••••••••••••
15 to 24 years ............................. ..
25 to 44 years ..............................
45 to 54 years ..............................
55 to 59 years ..............................
60 to 64 years ..............................
65 years and over ...........................
Related children under 18 years •••••••••••••
In families •••••••••••••••••••••••••••••••••
In unrelated subfamilies ••••••••••••••••••••
In metropolitan areas •••••••••••••••••••••••••
In central cities •••••••••••••••••• • •••••••••
Outside central cities •••••••••••••••••••••••
Outside metropolitan areas •••••••••••••••••••
Northeast •••••••••••••••••••••••••••••••••••••
Midwest 3
•••••••••••••••••••••••••••••••••••••
South ••••••••••••••••••••••••••••••••••••••••
West •••••••••••••••••••••••••••••••••••••••••
All families ••••••••••••••••••••••••••••••••••
Married-couple families ••••••••••••••••••••••
Male householder, no wife present •••••••••••
Female householder, no husband present •••••
All unrelated individuals •••••••••••••••••••••
Male ••••••••••••••••••••••••••••••••••••• • ••
Female ••••••••••••••••••••••••••••••••• • • •• •
Below
poverty
level
(nurt>ers in
thousands)
35,266
23,974
9,885
4,249
11,801
6,944
8,379
2,023
1,173
1,234
3, 711
13,668
13,326
342
21,750
12,872
8,878
13,516
6, 561
8,536
13,484
6,684
7,641
3,820
264
3,557
6,832
2,619
4,213
Poverty rate
1983 Difference from 1982
(percentage poi nts)
15.2 0.2
12.1 0.1
35.7 0.1
28.4 -1.5
23.0 0.4
17.6 • 1.1
11.9 0.1
9.1 -0.3
10.4 0.5
11.5 0.2
14.1 -0.5
22.1 0.4
21.7 0.4
61.2 0.9
13.8 0.1
19.8 -0.1
9.6 0.3
18.3 0.5
13.4 0.4
14.6 • 1.3
17.2 • -0.9
14.7 0.6
12.3 0.1
7.6 ( ~)
13.0 -1.4
36.0 -0.3
23.4 0.3
19.9 • 1.1
26.2 -0.4
1 Data are from the Income Supplement of the Census Bureau's Current Population Survey of March 1984.
2 Persons of Spanish origin may be of any race.
3 Formerly the North Central Region.
4 No change.
• Significant at the 95-percent confidence level.
Source: U.S. Department of Commerce, Bureau of the Census, 1985, Characteristics of the population
below the poverty level, 1983, Current Population Reports, Consumer Income, Series P-60, No. 147.
increase resulted from a significant rise in
the number of poor unrelated males.
The poverty threshold for a family of four
rose from $9,862 in 1982 to $10,178 in 1983.
Poverty thresholds rise each year by the
same percentage as the annual average
Consumer Price Index. The 1983 "poverty
gap"--the amount of money income needed
to raise a poor family above the poverty
line--was $4,020 for poor families, not
significantly different, in real terms, from
1982. The poverty gap for unrelated indivi­duals
was $2,230, an increase of $50 in real
terms from the previous year (significant at
the 90-percent confidence level).
Source: U.S. Department of Commerce,
Bureau of the Census, 1985, Characteristics
of the population below the poverty level:
1983, Current Population Reports, Consumer
Income, Series P-60, No. 147.
1985 No.4 family Economics Review 21
Costs and Benefits of the
Electronic Fund 'n'ansfer Act1
Most consumers now have a checking,
saving, or money market deposit account that
has at least one electronic fund transfer
(EFT) feature. 2 Consumer rights and
protections in the operation of EFT systems
were established by the Electronic Fund
Transfer Act, which became law in November
1978.
The Federal Reserve Board has responsi­bility
for writing regulations to implement
the EFT Act and for administering and
enforcing the act for State member banks.
Under Regulation E (Electronic Fund
Transfers) financial institutions must
comply with a number of specific disclosure
and documentation requirements and other
consumer safeguards, such as error resolu­tion
procedures and liability limits for
losses from unauthorized transfers. These
rules have costs as well as benefits asso­ciated
with them. The Board is required by
law to analyze the costs and benefits of the
EFT Act to consumers and other users of
EFT systems and to report annually to the
Congress. As part of these efforts, the
Board conducted a survey of financial insti­tutions
in 1981-82 to determine the costs of
complying with Regulation E. Sixty-seven
institutions, representing a wide range of
sizes, types, and geographic locations,
voluntarily responded to the survey q ues­tionnaire.
The incremental compliance cost
to the financial institution of an EFT
transaction, including startup as well as
1 For information on electronic fund
transfer systems, see "EFTS--Electronic
Funds Transfer Systems," Family Economics
Review, winter 1980, by Cynthia L. Jennings,
pp. 9-13; and Electronic Funds Transfer,"
Family Economic Review 1984, No. 1, P• 6.
2 In an April 1983 telephone survey con­ducted
for the Federal Reserve Board by the
University of Michigan Survey Research
Center, 61 percent of responding households
and 69 percent of those with a checking,
saving, or money market deposit account,
reported having an EFT feature.
22 family Economics Review 1985 No.4
ongoing costs, ranged from $0.10 to $0.33
through the first year of compliance.
Although the cost of compliance may appear
to be high relative to the cost of an EFT
transaction, EFT transactions, nonetheless,
have a cost advantage over check-based
transactions. In the long run, EFT trans­actions
can be made at little incremental
cost. Consequently, as EFT systems mature
and are more heavily utilized, the average
compliance cost per transaction is expected
to decrease.
Other data indicate that although con­sumers
are not widely aware of protections
afforded by the EFT Act, EFT systems are,
nonetheless, working well. The Board's
Consumer Complaint Control System received
only 75 complaints regarding EFT in 1982,
measured against 3 billion transactions
yearly at A TM's (automatic teller machines)
alone. Also, a 1983 survey of consumers
(see footnote 2) found that while 6 percent
of respondents who had an account with an
EFT feature alleged an error attributable to
that feature, 75 percent of those com­plained
to the institution, with nearly all
(95 percent) satisfied with the resolution
of the matter.
Source: Schroeder, Frederick J., 1985,
Compliance Costs and Consumer Benefits of
the Electronic Fund Transfer Act: Recent
Survey Evidence, Board of Governors of
the Federal Reserve System, Staff Studies
No. 143.
Regional Research Report­Innovative
Housing
Solar, earth-sheltered, manufactured, and
multifamily housing are receiving increased
attention as both the purchase and energy
costs of conventional housing increase.
Regional Project S-141, "Housing for Low­and
Moderate-Income Families," investigated
public acceptability of and institutional
effects on these innovative housing forms.
Personal interviews completed with 1, 804
southern households revealed that many
families would consider living in solar
retrofit (65 percent), passive solar
(54 percent), active solar (50 percent),
earth-sheltered (32 percent). multifamily
(27 percent). and manufactured (21 percent)
housing. Respondents who were younger, who
had higher incomes, and who had higher edu­cational
levels were more likely to consider
living in the solar and earth-sheltered
housing forms. whereas the converse was
true about respondents interested in the
multifamily and manufactured housing forms.
Questionnaires completed by county and
municipal officials representing 1,371
southern jurisdictions indicated that
climate. population. and government support
and/or intervention also influenced
acceptability of innovative housing. Results
of Project S-141 are summarized in the
Southern Cooperative Series Bulletins 298
and 305.1 Further exploration of innovative
housing currently is underway through the
recently approved Regional Project S-194,
"Barriers and Incentives to Affordable
Housing."
lPerceptions of Alternative Housing:
A Data Book, Southern Cooperative Series
Bulletin 298, 1983, is available (supply
limited) for $4 from the University of
Georgia, Agricultural Experiment Station.
125 Barrow Hall. Athens. GA, 30602; The
Impact of Codes and Regulatory Practices on
the Presence of Energy-Efficient Alternative
Housing. Southern Cooperative Series
Bulletin 305, 1984, is available free from
the Virginia Polytechnic Institute and State
University. Virginia Agricultural Experiment
Station, Blacksburg. VA, 24061.
Source: Report submitted by Kenneth R.
Tremblay. Jr •• University of Arkansas.
Fayetteville. Additional information about
Regional Projects S-141 and S-194 and a com­plete
list of publications and manuscripts
may be obtained from Margaret Weber, Chair
of Regional Committee S-194, Department of
Housing, Design. and Consumer Studies.
Room 438 H.E.W •• Oklahoma State University,
Stillwater, OK 74078.
BLS Consumer Expenditure
Interview Survey Data
Available
Microdata tapes containing information on
consumer expenditures, income. and charac­teristics
collected in 1980-81 from the
Interview component of the ongoing Consumer
Expenditure Survey are available from the
U.S. Department of Labor, Bureau of Labor
Statistics (BLS). The data. collected from
samples of approximately 5. 000 households
each year, include monthly expenditures for
housing. apparel and services. transporta­tion.
health care, entertainment, personal
care, reading. education, food, alcoholic
beverages. tobacco, cash contributions, and
personal insurance and pensions; and socio­economic
characteristics of each household.
For further information about the tapes,
contact the Division of Consumer Expenditure
Surveys. Bureau of Labor Statistics. Room
4216, 600 E Street, NW •• Washington. DC
20212 (phone: 202-272-5060). To purchase
the tapes, send a check (payable to Bureau
of Labor Statistics) to Division of Planning
and Financial Management, Bureau of Labor
Statistics. Room 2127. 441 G Street NW ••
Washington. DC 20212. Cost of the tapes is
$230 for 1600 BPI (eight tapes) and $130
for 6250 BPI (two tapes). Specify whether
you want labeled or unlabeled tapes.
A new publication from BLS presents
selected results from the Survey. Thirty
tables show expenditures and income for
American consumers grouped by character­istics
such as family income. family size.
age of householder. and region of residence.
Other information in the bulletin includes
comparisons of the 1980-81 data with other
data (including the 1972-73 Consumer
Expenditure Survey). description of
methodology. and some analysis of the
data. Consumer Expenditure Survey:
Interview Survey. 1980-81, Bulletin 2225
(Stock No. 029-001-02841-5) may be ordered
for $6 from the Superintendent of Documents.
Government Printing Office, Washington, DC
20402. or the Chicago Regional Office of
the Bureau of Labor Statistics. 9th floor,
Federal Office Building. 230 South Dearborn
Street, Chicago. IL 60604.
1985 No.4 Family Economics Review ZJ
Child Support and Alimony
Concern over the economic condition of
women and children involved in divorce and
separation has grown due to the high divorce
rate and increases in the number of families
headed by women with no husbands present.
The Bureau of the Census conducted a survey
in 1979 and again in 1982 to obtain data on
child support and alimony. The resulting
report presents information on payments made
to mothers for the support of their children
by absent fathers, and information on
alimony pay~ents and property settlement
awarthr for women involved in marital
dissolution.
As of spring 1982, 8.4 million mothers
were living with a child under age 21 whose
father was not living with them. Of these
women, 59 percent were awarded or had an
agreement to receive child support payments
for their children. However, only 47 percent
of those due payment received the full
amount due. For women receiving payments
irregularly or not at all, the main reason
reported was refusal of the father to pay.
The mean amount of child support for
women who received payments in 1981 was
$2,110. After adjusting for inflation over
the period from 1978, the average child sup­port
payment showed a 16-percent decrease
from the 1978 figure. This decrease is not
surprising since support payments rarely
have escalator clauses that adjust for in­creases
in consumer prices. The women most
likely to be awarded and to receive child
support payments were white women, women
who had attended college, women in white­collar
occupations, women living outside of
central cities within metropolitan areas,
and those with unearned income other than
government transfer payments.
Of the 8. 4 million mothers of children
with an absent father, 31 percent had
incomes below the poverty level in 1981.
Only 31 percent of these women had agree­ments
and were due to receive child support
in 1981. Of those due to receive child
2• Fam i ly Econom i cs Review 1985 No.4
support, only 60 percent received payments,
with a mean payment of $1,440. The charac­teristics
of poor women who were most likely
to receive child support payments paralleled
the characteristics for all women.
As of spring 1982, only about 15 percent
of the 17 million ever-divorced or currently
separated women were awarded or had an
agreement to receive alimony or maintenance
payments. Women most likely to have an
award were women over age 40 who were
divorced or separated prior to 1970 and not
working at the time of the divorce or sepa­ration.
Black women and women under age
30 were least likely to receive an award.
The mean amount of alimony received in 1981
was $3,000. This payment represents a 25-
percent decrease from the average level of
1978 after adjusting for inflation. Of the
3. 5 million ever-divorced or currently
separated women below the poverty level,
about 11 percent were awarded or had an
agreement to receive alimony or maintenance
payments, with an average payment of $1,250
in 1981.
About 42 percent of the 14.2 million women
who had ever been divorced received some
form of property settlement as of spring
1982. Women most likely to have a property
settlement were those between the ages of 30
and 39 and those with 4 or more years of
college.
Source: U.S. Department of Commerce,
Bureau of the Census, 1985, Child support
and alimony: 1981, Current Population
Reports, Special Studies, Series P-23,
No. 140.
'oll
CD
\11
z
0
l>-
..,
Ill
3 .,._....
'< ,
0
0
::l
0
.3.. ..
0
0)
;;>;)
(D
<.... .
(D
:a:
N
"'
Cost of food at home estimated for food plans at 4 cost levels, June 1985, u.s. average 1
Sex-age group
FAMILIES
Family of 2: 2
20-50 years ........................
51 years and over .•.•••.••.•..••..•
Family of 4:
Couple, 20-50 years and children--
1-2 and 3-5 years ••••••••••••••••
6-8 and 9-11 years •••••••••••••••
INDIVIDUALS 3
Child:
1-2 years ..........................
3-5 years "" .........................
6-8 years ..........................
9-11 years •••••••••••••••••••••••••
Male:
12-14 years ..............•.........
15-19 years ........................
20-50 years ••••••••••••••••••••••••
51 years and over .......••.•..•.•.•
Female:
12-19 years ........................
20-50 years ........................
51 years and over •••••••••••••••••
Thrifty
plan
$37.00
35.00
53.80
62.00
9.70
10.50
13.00
15.40
16.10
16.70
17.70
16.10
16.00
15.90
15.70
Cost for 1 week
Low-cost
plan
$46.40
44.30
67.00
78.80
11.80
13.00
17.10
19.50
22.10
22.90
22.50
21.30
19.00
19.70
19.00
1\txlera te­cost
plan
$57.10
54.40
81.50
98.20
13.70
15.90
21.40
24.90
27.40
28.30
28.10
26.10
23.00
23.80
23.40
Liberal
plan
$70.40
65.10
99.50
117.80
16.40
19.10
24.90
28.90
32.20
32.80
33.80
31.30
27.70
30.20
27.90
Thrifty
plan
$160.20
151.40
233.40
268.50
42.10
45.70
56.20
66.70
69.60
72.60
76.80
69.70
69.10
68.80
67.90
Cost for 1 month
Low-cost
plan
$201.10
192 . 20
289.90
341.40
51.00
56.10
74.20
84.40
95.60
99.10
97.50
92.30
82.50
85.30
82.40
MOderate- Liberal
cost plan plan
$247.60 $305.20
236.30 282.00
353.30 431.70
425.80 510.80
59.20 71.30
69.00 82.90
92.70 108.10
108.00 125.20
118.90 139.50
122.40 142.00
121.90 146.50
113.30 135.40
99.70 120.10
103.20 131.00
101.50 121.00
1 Assumes that food for all meals and snacks is purchased at the store and prepared at home. Estimates for the thrifty food
plan were computed from quantities of foods published in Family Economics Review, 1984 No. 1. Estimates for the other plans
were computed from quantities of foods published in Family Economics Review, 1983 No. 2. The costs of the food plans are
estimated by updating prices paid by households surveyed in 1977-78 in USDA's Nationwide Food Consumption Survey. USDA
updates these survey prices using information from the Bureau of Labor Statistics ( CPI Detailed Report, table 3) to estimate
the costs for the food plans.
2 10 percent added for family size adjustment. See footnote 3 •
3 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- or 6-person--subtract
5 percent; 7- or more-person--subtract 10 percent.
()
~
B.
~
0
0. a
5=
~
Updated Estimates of the Cost of Raising a Child
The cost of raising urban children: June 1985; moderate-cost level 1
Region and
age of child
(years)
MIDWEST: 5
Total
Food
at
hane 2
Food
away
fran
hane
Clothing Housing 3 Medical
care
Educa­tion
Transpor- All
tat ion other 4
Under 1 • •••••••• $4,429 $570 $0 $140 $1,909 $298 $0 $890 $622
1 • • • • • • •• • • • • •• • • 4,558 699 0 140 1,909 298 0 890 622
2-3 •• •• •••••••••• 4,240 699 0 228 1,678 298 0 775 562
4-5 • • • • • • • • • ••• • • 4,490 803 146 228 1,678 298 0 775 562
6 •••••••••••••••• 4,692 777 146 316 1,591 298 138 775 651
7-9 • • • • • • • • • • • • • • 4, 873 958 146 316 1' 591 298 138 775 651
10-11 •••••• •••••• 5,055 1,140 146 316 1,591 298 138 775 651
12 ••• •••••••••••• 5,396 1,166 175 456 1,649 298 138 833 681
13-15 •• •••••• •• •• 5,525 1,295 175 456 1,649 298 138 833 681
16-17 • • • • • • • • • • • • _6"-'''-'0C.:::5.::..9 __ _:1:.!.,...:.4::.;50::__ __ :.;17:..:5:.__ _6 ::..:3:..:2:.__ ___;1~,'-'-7..::.0.:...7- ---=2.::..9.::..8 __- =.1::.:38::__ __ _:9:...:1::.9_ __7; ;4;_;:0_ _
Total •••••••••• 89,957 18,155 2,218 6, 176 30 , 086 5, 364 1, 656 14 , 700 11,602
NORTHEAST:
Under 1 .••.••.••
1 ..••.•••.•••••••
2-3 ••••••••••••••
4-5 ••••••••••••••
6 ••••••••••••••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total
SOUTH:
Under 1 •••••••••
1 ••••••••••••••••
2-3 ••••••••••••••
4-5 ••••••••••••••
6 ••••••••••••••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total
WEST:
Under 1 •••••••••
1 ••••••••••••••••
2-3 ••••••••••••••
4-5 ••••••••••••••
6 ••••••••••••••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total ••••••••••
4,386
4, 542
4,422
4,672
5,021
5,202
5,435
5,766
5,921
6,345
94,832
4,823
4,952
4,640
4,864
5,159
5,314
5,522
5,883
6,038
6,482
97,889
4,751
4,906
4,652
4,931
5,300
5,481
5, 714
6,028
6,158
6,754
100,004
673
829
803
907
907
1,088
1,321
1,321
1,476
1,632
20,748
6.22
751
725
803
803
958
1,166
1,166
1,321
1,450
18,467
622
777
751
855
829
1,010
1,243
1,243
1,373
1,554
19,426
0
0
0
146
175
175
175
175
175
204
2,450
0
0
0
146
175
175
175
204
204
204
2,566
0
0
0
175
204
204
204
204
204
234
2,858
140
140
246
246
333
333
333
491
491
614
6,454
158
158
246
246
333
333
333
491
491
632
6,526
140
140
228
228
333
333
333
474
474
597
6,280
1,938
1,938
1,765
1,765
1,736
1,736
1,736
1,794
1, 794
1,823
32,174
2,054
2,054
1,823
1,823
1. 736
1,736
1,736
1,794
1,794
1,852
32,696
1,996
1,996
1,794
1,794
1, 765
1,765
1,765
1,823
1,823
1,909
32,868
298
298
298
298
298
298
298
298
298
298
5,364
332
332
332
332
332
332
332
332
332
332
5,976
365
365
365
365
365
365
365
365
365
365
6,570
0
0
0
0
173
173
173
173
173
173
2,076
0
0
0
0
207
207
207
207
207
207
2,484
0
0
0
0
173
173
173
173
173
173
2,076
775
775
718
718
718
718
718
804
B04
861
13,668
947
947
833
833
833
833
833
890
890
976
15,736
947
947
833
833
861
861
861
947
947
1, 034
16,248
562
562
592
592
681
681
681
710
710
740
11 , 898
710
710
681
681
740
740
740
799
799
829
13,438
681
681
681
681
770
770
770
799
799
888
13,678
1 Annual cost of raising a child from birth to age 18, by age, in a husband-wife family with no more than 5 children.
For more information on these and additional child cost estimates, see USDA Miscellaneous Publication No . 1411, "USDA
Estimates of the Cost of Raising a Child: A Guide to Their Use and Interpretation," by Carolyn s. Edwards, Family
Economics Research Group, Agricultural Research Service, USDA.
2 Includes home-produced food and school lunches.
3 Includes shelter, fuel, utilities, household operations, furnishings, and equipment.
• Includes personal care, recreation, reading, and other miscellaneous expenditures.
5 Formerly the North Central Region.
26 family Economics Review 1985 No.4
The cost of raising rural nonfarm children: June 1985; moderate-cost level 1
Region and
age of child
(years)
MliJWEST: 5
Under 1 •••••••••
1 ••••••••••••••••
2-3 ••••••••••••••
4-5 ••••••••••••••
6 ••••••••••••••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total ••••••••••
NORTHEAST:
Under 1 •••••••••
1 ••••••••••••.•••
2-3 ••••••••••••••
4-5 ••••••••••••••
6 ••••••••••••••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total
SOUTH:
Under 1 •••••••••
1 ••••••.•••••••••
2-3 ••••••••••••••
4-5 ••••••••••••••
6 ••••••••••••••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total
WEST:
Under 1 •••••••••
1 .. • •••••.•..••..
2-3 ••••••••••••••
4-5 ••••••••••••••
6 •••••••• •••• ••••
7-9 ••••••••••••••
10-11 ••••••••••••
12 •••••••••••••••
13-15 ••••••••••••
16-17 ••••••••••••
Total ••••••• • ••
Total
$4,185
4,315
3,834
4,054
4,384
4,540
4,747
5,110
5,239
5,623
83,847
4,859
4,988
4,760
5,039
5,412
5,567
5,800
6,149
6,305
6,851
101,924
5,024
5,127
4,640
4,919
5,126
5,281
5,489
5,898
6,027
6,539
98,273
5,216
5,345
4,825
5,104
5,500
5,681
5,888
6, 297
6,453
7,069
104,532
Food
at
hare 2
$518
648
622
725
725
881
1,088
1,088
1,217
1,347
16,837
622
751
725
829
829
984
1,217
1,217
1,373
1,528
19,088
622
725
699
803
777
932
1,140
1,140
1,269
1,425
18,001
622
751
725
829
803
984
1,191
1,191
1,347
1,528
18,906
Food
away
fran
hare
$0
0
0
117
146
146
146
146
146
175
2,044
0
0
0
175
204
204
204
204
204
234
2,858
0
0
0
175
175
175
175
204
204
234
2,684
0
0
0
175
175
175
175
204
204
234
2,684
Clothing Housing 3 Medical
care
$123
123
193
193
298
298
298
456
456
562
5,754
140
140
228
228
333
333
333
509
509
667
6,560
158
158
246
246
333
333
333
509
509
720
6,774
140
140
228
228
351
351
351
527
527
614
6,634
$1,823
1,823
1,533
1,533
1,504
1,504
1,504
1,562
1,562
1,591
28,232
2,054
2,054
1,880
1,880
1, 852
1,852
1,852
1,909
1,909
1,967
34,310
2,054
2,054
1,765
1,765
1,707
1,707
1, 707
1,765
1,765
1, 794
32,058
2,083
2,083
1,794
1,794
1,765
1,765
1,765
1,823
1,823
1,938
33,100
$298
298
265
265
265
265
265
265
265
298
4,902
298
298
298
298
298
298
298
298
298
298
5,364
332
332
332
332
332
332
332
332
332
332
5,976
365
365
332
332
365
365
365
365
365
365
6,438
Educa­tion
$0
0
0
0
138
138
138
138
138
138
1,656
0
0
0
0
207
207
207
207
207
207
2,484
0
0
0
0
173
173
173
173
173
173
2,076
0
0
0
0
207
207
207
207
207
207
2,484
Transpor­tation
$861
861
718
718
746
746
746
833
833
861
14,124
1,005
1,005
919
919
919
919
919
976
976
1,062
17,228
1,148
1,148
947
947
919
919
919
1,005
1,005
1,062
17,742
1,148
1,148
976
976
976
976
976
1,062
1,062
1,206
18.716
All
other '
$562
562
503
503
562
562
562
622
622
651
10,298
740
740
710
710
770
770
770
829
829
888
14,032
710
710
651
651
710
710
710
770
770
799
12,962
858
858
770
770
858
858
858
918
918
977
15,570
1 Annual cost of raising a child from birth to age 18, by age, in a husband-wife family with no more than 5 children.
For more information on these and additional child cost estimates , see USDA Miscellaneous Publication No. 1411, "USDA
Estimates of the Cost of Raising a Child: A Guide to Their Use and Interpretation," by Carolyn S. Edwards, Family
Economics Research Group, Agricultural Research Service, USDA.
2 Includes home-produced food and school lunches.
3 1ncludes shelter, fuel, utilities, household operations, furnishings, and equipment.
'I ncludes personal care, recreation, reading, and other miscellaneous expenditures.
5Formerly the North Central Region.
1965 No.4 family Economics Review 27
Consumer Prices
Consume,. p,.ice Index fo,. all u,.ban consume,.s [ 1967 = 100)
Group
All items ••••••••••••••••••••••••••••••••••••
Food ••••••••••••••••••••••••••••••••••••••
Food at home ••••••••••••••••••••••••••••
Food away from home ••••••••••••••••••••
Housing •••••••••••••••••••••••••••••••••••
Shelter ••••••••••••••••••••••••••••••••••
Rent, residential ••••••••••••••••••••••
Fuel and other utilities ................ .
Fuel oil, coal, and bottled gas ••••••••
Gas (piped) and electricity ••••••••••••
Household furnishings and operation •••••
Apparel and upkeep •••••••••••••••••••••••
Men's and boys' •••••••••••••• •••• •••••••
Women's and girls' •••••••••••••••••••••••
Footwear ••••••••••••••••••••••••••••••••
Transportation ••••••••••••••••••••••••••••
Private ••••••••••••••••••••••••••••••••••
Public ••••••••••••••••••• ••••••• •••••••••
Medical care •••••••••••••••••••••••••••••••
Entertainment •••••••••••••••••••••••••••••
Other goods and services ••••••••••••••••••
Personal care ••••••••••••••••••••••••••••
July
1985
322.8
309.5
296.2
347.3
351.6
383.2
265.0
399.9
601.9
467.1
246.5
202.tl
194.5
163.4
211.4
321.8
316.1
402.4
404.0
265.7
325.0
282.3
June
1985
322.3
309.3
296.0
346.9
350.4
381.0
263.6
399.4
612.0
465.6
247.1
204.6
196.4
166.5
213.9
321.8
316.3
399.3
401.7
264.8
323.0
281.7
Source: U.S. Department of Labor, Bureau of Labor Statistics.
May
1985
321.3
308.9
296.2
345.1
348.5
379.5
262.6
393.0
620.8
454.7
247.6
205.3
197.8
168.0
213.2
321.4
316.0
398.4
399.5
263.6
322.3
280.9
Subscrtptl.on Order Or
Change Of Address Form
FAMILY Annual subscription Single copies
Enclosed is s. ______ _
0 Check
0 Money order
0 Charge to my Deposit Account
No ________ _
~der No. ______ _
Make check payable to
Superintendent of Documents
CREDIT CARD ORDERS ONL T
(Visa and Mastercard)
Total charges S
Credlt card No
Expiration Date Month/Year
ECONOMICS $12.00 domestic $325 domestic
REVIEW ($15.00 foreign) ($4.10 foreign).
Ple<De print or type
Company 01 Personal Name
I I I I I I I I I I I I I
Addltional Address I Anention Une
I I I I I I I I
Street Address
I I I I I
City
I I I
Country
I I I I
CHANGE OF ADDRESS
Please anach maUing label here and
send this form when requesting a
change of address
loiAJL ORDER FODl TO.
Superintendent of Documents
Gaoremment Prtnttng otftce
WCDhlngton, D.C. 20402
July
1984
311.7
303.2
292.5
334.4
338.1
362.7
249.7
393.9
637.4
459.1
241.9
196.6
189.8
156.2
208.0
312.9
307.5
389.3
380.3
255.3
306.5
271.8
State ZIP Code
LlJ I I I I
I I I
FOR omCE USE ONLY
Quantity
___ PubUcatlons
___ Subscriptions
Charges
Special Shipping Charges __ _
International Handling ___ _
Special Charges _____ _
OPNR
____ UPNS
____ Balance Due
____ Dtscounl
____ Refund
28 family Economics Review 1985 No.4 ~ U.S GOVERNMENT PRINTING OFJrlCE: 1985 - 461-964 - 814/34004
Agricultural Outlook '86
Program- Outlook for Families
The Agricultural Outlook Conference will
be held from December 3 to 5, 1985, in
Washington, DC. To obtain additional infor­mation
about the Conference or to register
in advance, write: Outlook '86, Room 5143,
South Building, Washington, DC 20250, or
call 202-447-3050. To obtain Conference
materials and a building pass to this free
Conference, participants are asked to go to
the Patio in USDA's Administration Building
at 12th Street and Independence Avenue.
Home Economics: Outlook for Families will
convene on the morning of December 4, in
Wednesday, December 4
room 107-A of USDA's Administration
Building. The first session will examine how
economic trends and conditions will affect
families and, in particular, what economic
issues are influencing farm family living.
This year's human nutrition program,
11 Dietary Guidelines--Spreading the Word, 11
will focus on plans to help consumers use
the USDA/HHS Dietary Guidelines for
Americans (Second edition) in their everyday
lives. Plans developed by the Federal
Government, the Cooperative Extension
Service, and supermarkets will be featured.
A live access telephone line service will
not be available for the sessions listed
below.
8:00-8:30 Coffee and conversation outside Room 107-A
8:30-10:30
10:45-12:15
FAMILY ECONOMICS
Moderator - (to be announced)
Economic Outlook for Families - Colien Hefferan, ARS-USDA
Discussants - Josephine Turner, ES-USDA
Harold D. Guither, University of Illinois
Economic Outlook for Farm Families - Kathleen K. Scholl, ARS-USDA
Discussants - Ronald T. Daly, ES-USDA
Karen P. Goebel, University of Wisconsin
DIETARY GUIDELINES--SPREADING THE WORD
Moderator - Suzanne S. Harris, HNIS-USDA
Federal Government's Role - Susan 0. Welsh, HNIS-USDA
Cooperative Extension Service's Role - Jean M. Howe, ES-USDA
Food Marketing Strategies - Susan N. Borra, Food Marketing Institute.
1985 No.4 Family Economics Review 29