Family Economics Review [1987, Number 4]

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Economics
Review
1987 No.4
Contents:
Family Budget Guidelines
Col ien Hefferan
Federal Consumer and Educational Publications Relating to
Family Economics
Joyce Pitts
Abstracts
Work Schedules of Americans:
Multiple Jobholders
Shift Work and Flexitime
Work at Home
Housing Costs After Tax Reform
The Effect of Interest Rate Ceilings on Credit Card Loans
Heterogeneity Among Persons 65 Years and Older
Regular Features
New Publications
Agricultural Outlook '88--Preliminary Program Highlights
Cost of Food at Home
Updated Estimates of the Cost of Raising a Child
Consumer Prices
Index of Articles in 1987 Issues (back cover)
Room 442A Hyattsville. Md 20782. Issu ed 0 ctober 1987
1
10
26
30
31
34
25
25
33
36
38
Family Budget Guidelines
By Colien Hefferan
Economist
"How much does it cost the average Ameri­can
family to live the average American life?"
This seemingly simple question about family
budget guidelines, and its corollary, "How
much should we spend?" are among the most
frequently asked questions of family econo­mists.
Creditors would like to be able to
assess a borrower's ability to pay by com­paring
his actual spending and obligations
to a statistical standard. College financial
aid officers could use family budget
guidelines in setting need and eligibility
criteria for student assistance. Policy
makers need standards to establish the
income adequacy levels that underlie
poverty measures and to evaluate levels of
living among groups and over time. Educators
and financial planners want family budget
guidelines to assist families in managing
their money.
Developing accurate descriptions and pro­files
of family spending patterns has been
the focus of family economics research for
more than 200 years, yet consistent, reli­able,
and useful estimates continue to elude
researchers and practitioners. This article
reviews the history of budget guideline
research and development and identifies
criteria for evaluating the usefulness of
current indicators of expenditure levels and
patterns as family budget guidelines.
HISTORY
Family budget guidelines date back to 1767
when Arthur Young [cited in Monroe (!!)l
presented a scheme of expenditures by which
English agricultural laborers could meet
their current needs and save for the future.
Ten years later, David Davies [cited in
Monroe (_!!_)] systematically collected expen­diture
data from 135 families and published
the data, with no summaries or averages,
to provide a basis for understanding the
problems of the poor.
Interest in family budgets grew throughout
Europe. In 1853 budgets were the center of
discussion at the First International Statis­tical
Congress in Brussels (.!!__). Shortly
thereafter the Belgian and French Govern­ments
supported data collection, analysis,
and publication of information on family ex­penditures.
The French study, conducted by
Frederic LePlay (~_), became the best known
and most influential of the early studies.
LePlay presented data on living conditions
and family spending in France and other
European countries, including England, Nor­way,
Russia, and Spain. His research laid
the groundwork for studying family expenses
as a way to understand societal conditions
and family living patterns.
Ernst Engel, representing Saxony at the
Statistical Congress in Brussels, took the
analysis of household accounts several steps
further. Using limited information from
Saxony and drawing on the data and analysis
of LePlay and other European contemporaries,
he hypothesized and tested a series of rela­tionships
among the components of household
income and expenditures. These relationships,
known as Engel's laws (.!!__), are the basis for
much household eoonomic analysis today. The
laws include:
1. The greater the revenues of an indivi­dual
or a family, the more fully do
they provide the means necessary for
the satisfaction of all the needs of
existence. The less the revenues, the
greater is the proportion devoted to
expenditures for physical and material
needs, and the less the remainder for
expenditures for religion, for moral
and intellectual needs, and, in general,
luxury.
2. The smaller the sum essential for the
satisfaction of physical and material
needs, the greater the proportion that
must be used for food alone.
3. The greater the inadequacy of the sum
available for food, the less able is a
person to obtain food of the quality
needed. Under these conditions, one
must have recourse to foods that are
less expensive but also less nourishing
and strengthening.
The most frequent summary of Engel's laws
simply states that relative expenditures for
food increase with a decrease in well-being.
However, the laws have been restated and
extended by others to cover specific
components of family expenditures such as
clothing, lodging, and utilities. The laws
1987 No.4 Family Economics Review
and their extensions, as well as Engel's
careful nomenclature and methods, established
the theoretical and methodological basis for
the collection and analysis of household
budget data.
In the United States, the first nationwide
expenditure survey was conducted by the
Bureau of Labor Statistics (BLS) in 1888-1891
to obtain cost-of-living data for the work-ing
population (.!!). The survey program
was expanded in 1901 and 1917-19 to collect
comprehensive information on all categories
of family ex penditures. During 1934-36, BLS
conducted two surveys--a limited survey of
expenditure levels, and an extensive study
of ex penditures, income, occupation, region,
race, and family composition. The first was
used for revising the Consumer Price Index
( CP I); the latter. for analysis of family
ex penditure patterns and the development of
family budget guidelines. Expenditure surveys
were again conducted in 1941-42. 1960-61,
1972-73 , and beginning in 1980 on a
contin uing basis (.!..!!).
Using data collected in the 1960-61 Consu­mer
Expenditure Survey (CES). BLS devel­oped
a set of budgets representing the costs
of three hypothetical lists of goods and
services specified to portray three relative
standards of consumption--lower, intermedi­ate,
and higher (.!_Q). The budgets were de­signed
for a precisely defined urban family
and a retired couple. The family comprised a
38-year-old husband employed full time, a
nonworking wife, a boy of 13, and a girl of
8. The family was assumed to have been
established for 15 years; be settled in the
community; and hold an average inventory
of clothing, household furnishings, major
durables, and equipment. Similar limiting
assumptions were made about the retired
couple.
The budgets were not intended to represent
how families of this type actually spent or
should have spent their money. Rather they
reflected assumptions and analysis about the
manner of living at each consumption level.
Some components, such as food at home, were
based on scientific standards. Other compo­nents,
such as shelter, reflected prevailing
social standards.
The BLS family budgets illustrated several
of the relationships observed by Engel more
than a century earlier (table 1). At the
Table 1. Budget allocations for a 4-person family at 3 levels of living. urban
United States, autumn 1981 1
Component
Total family consumption •••••••••••••••••
Food .•......... · · · · · · · · • • • • • · • · · · · · · · ·
Housing .............................. .
Transportation ....................... .
Clothing . ............................. .
Personal care •• • •...•••.•.•••..••.•.•••
Medical care . ...................•......
Other family consumption ••••••••••••••
Total nonconsumption ••••••••••••••••.•••
Other items .......................... .
Social Security and disability •••••••••
Personal income taxes •••••••••••••••••
Lower
79
21
30
18
9
6
2
10
4
4
7
10
Intermediate
(percent)
72
23
22
9
5
2
6
5
28
4
7
17
Higher
65
35
19
22
8
5
2
4
5
5
5
25
1 Calculated as percentages from expenditure levels reported by the U.S. Department of
Labor, Bureau of Labor Statistics (!_!).
2 Fam i ly Ec onomics Rev i ew 1987 No.4
lower standard of consumption, a larger bud­get
share was allocated for food and other
necessities than at the higher standard.
Taxes and other nonconsumption items claimed
a larger budget share at the higher standard
than at the lower or intermediate standards.
Some items such as clothing and personal
care, although claiming widely dissimilar
dollar amounts, were at a similar budget
share across all levels of consumption.
The budgets, which included all major
categories of consumption and taxes, were
updated quarterly until 1969 by directly
pricing the quantities of goods and services
detailed for each level. Beginning in 1970,
the budgets were updated by applying the
price changes for individual components as
reported in the CPl. In autumn 1981, BLS
released the final quarterly update of the
budgets, citing the need for costly new
methodologies and expenditure and price
data.
CURRENT INDICATORS
Since BLS discontinued releasing family
budget data in 1981 <.!.!), those providing
financial advice to families and economic
guidance to decision makers have been
without an ongoing statistical series specif­ically
designed to describe the spending
patterns of American families. 1 In the
absence of the BLS series, what Federal data
are available from which to assess spending
patterns and standards? This section reviews
several sources and identifies criteria for
evaluating their usefulness as current
indicators of family budget guidelines.
BLS Family Budget Data--Updated
BLS discontinued the family budget series
in 1981 because the expenditure data on
which it was based were 20 years old, the
family type represented was atypical of
1 The Community Council of Greater New
York <.V periodically publishes standard
budgets based on expenditure patterns and
costs of families in New York City. The
guidelines are developed using methods
similar to those used by BLS in the family
budget program. The spending estimates are
applicable only to New York City households,
however.
American households, the methods for assign­ing
quantities of goods and services at each
of the three levels were controversial, and
the updating procedure reflected changes in
prices faced by all urban consumers not just
those covered in the family budgets. Despite
these concerns, many continue to use these
budgets because the estimates appear
"reasonable" and no series has been devel­oped
to replace it. By repricing individual
components of the last published budgets,
using the CPI, an approximate update of the
budgets can be effected. This procedure is
applicable only to the consumption portion
of the budgets, however. Updating the taxes
and other nonconsumption components
requires complicated estimates based on
changing family income, Social Security
earnings caps and contribution rates, and
income tax liabilities.
Given the concerns that resulted in BLS
discontinuing the series in 1981 and the
difficulties associated with reestimating
the tax and other "nonconsumption components,
updating the budgets is ill-advised. However,
if an updated version is required for a
specific purpose, such as longitudinal com­parisons,
some of these concerns can be
ameliorated by expressing the budgets in
terms of budget shares--that is, percent
allocations to each component rather than
spuriously accurate dollar amounts. Table 2
(p. 4) shows estimated family budget alloca­tions
updated to spring 1987 prices and
reflecting current Social Security and
income tax regulations and rates. This table
and other estimates based on the discon­tinued
BLS series should be used very
judiciously.
BLS Expert Committee on Family Budgets
Proposal
In 1978, before BLS discontinued the fami­ly
budget program, it convened a panel of
experts to review the data series and
recommend changes and improvements. The
Expert Committee recommended that four
American Family Budget Standards be devel­oped
to replace the then current three fami­ly
budgets. The four budgets, although
based on new assumptions and methods,
would continue "to express normative and
quantitative standards that can be used to
1987 No.4 Family Economics Review 3
evaluate levels of living among groups,
between times and across regions"
(_!_!, P• 3) •
The proposed budgets would be built
around a standard designed to reflect the
level of living of the typical family. This
standard, called the Prevailing Family Stan­dard,
would be set at the median level of
expenditure of two-parent families with two
children. 2 The Expert Committee viewed this
standard as affording the family the oppor­tunity
to fully participate in contemporary
life. It was conceptually similar to the
"modest but adequate" (intermediate standard
of consumption) budget in the old series.
2The median level of expenditures would
be estimated directly from the ongoing CES.
In the absence of expenditure data, the Com­mittee
recommended adjusting annual income
medians reported in the Current Population
Survey.
Three other standards would be derived
from the Prevailing Family Standard. The
Social Minimum Standard would be set at half
of the Prevailing Standard and could be used
to define poverty and eligibility for social
and economic assistance programs. The Lower
Living Standard, fixed at two-thirds of the
Prevailing Standard, would succeed the old,
lower family budget. It would represent the
level requiring frugality and few choices in
achieving what Americans consider an accept­able
standard of consumption. The Social
Abundance Standard, set 50% higher than the
Prevailing Family Standard (or three times
the Social Minimum), would reflect the begin­ning
of the expenditure range that allows
choices and luxuries.
The proposed standards use an equivalence
scale to calibrate differences in family size.
The scale is adapted from that used in set­ting
Federal poverty guidelines and is based
Table 2. Budget allocations for a 4-person family at 3 levels of living, urban United States,
spring 1987 1
Component
Total family consumption •••••••••••••••••
Food ...••.....•. · · · · · · • · · · · · · · · • • · • · • ·
Housing .....•.....•...................
'fransportation ....•............•......
C lathing . ......•.......................
Personal care •••............••..•..•.•
Medical care ....... ................... .
Other family consumption ••••••••••••••
Total nonconsumption ••••••••••••••••.•••
Other items .......................... .
Social security and disability •••••••••
Personal income taxes •••••••••••••••••
Lower
81
19
28
22
12
3
8
8
5
2
8
4
Intermediate
(percent)
72
28
20
27
11
3
8
17
4
2
5
3
Higher
67
33
17
27
10
4
2
4
3
4
6
23
1 Calculated as percentages from expenditure levels reported by the U.S. Department of
Labor, Bureau of Labor Statistics <!!.); updated using components of the Consumer Price
Index and The Internal Revenue Code.
4 Fam i ly Economics Rev i ew 1987 No.4
on the USDA's Thrifty Food Plan. 3 Table 3
shows the equivalence scale proposed by the
Expert Committee and the updated values of
the expenditure standards for 1984 (the
latest year for which expenditure data are
available).
The standards proposed by the Expert
Committee are defined and estimated as
expenditure totals rather than detailed
family budgets. As such they may fail to meet
the needs of educators, financial advisors,
and consumers seeking guidelines for specific
budget allocations. At the same time,
however, they indicate overall expenditures
associated with a range of consumption
levels. Consequently, the standards may be
3 For information on Federal poverty guide­lines,
see "Poverty Thresholds and Poverty
Guidelines," Family Economics Review
1985(1):17-18. For information on the
Thrifty Food Plan, see Richard L. Kerr,
et al., "USDA 1983 Thrifty Food Plan,"
Family Economics Review 1984(1): 18-25.
useful to those (such as creditors) wishing
to evaluate broad measures of economic status
of specific families and to policy makers
assessing economic well-being of families
between groups and over time.
CES Data
The continuing CES (.Q_) is collected in two
independent parts--a quarterly interview
survey and a diary survey covering two
consecutive 1-week periods. Each survey in­cludes
its own sample of about 5, 000 consu­mer
units and is collected in 85 areas of
the country rep resenting the U.S. urban
population. The interview survey is designed
to account for 95% of expenditures; the
diary survey covers only frequently pur­chased
items such as food and housekeeping
supplies. The CES data provide the primary
Federal source of information about house­hold
spending. With expansion of the
surveys to a continuing basis, numerous
reports of spending averages, comparisons
over time, and consumer response to price
Table 3. Equivalence scale and updated values of American family expenditure standards,
1984
Number of persons
1, aged ................ .
1, nonaged ...•..........
2, aged •••••••.•.•..•.••
2, nonaged ............. .
3
4 •••.•...•..•.........•.
5
6 •••••••••••••••••••••••
7 •••.•••••.•••••••••••••
8
9 •••••.••.•.•..••.••••••
10 ...•..........•.......
11 ......•.....•......•..
12 ••••..••.•.•.•••••••••
Each additional person ••
Equivalence
scale
.50
.54
.61
.67
.so
1.00
1.20
1.39
1.57
1.74
1.90
2.05
2.19
2.32
+.12
Social
Min illlliil
Standard
$6,943
7,498
8,470
9,303
11,108
13,885
16,662
19,300
21,800
24,160
26,382
28,465
30,408
32,213
1,666
Lower
Living
Standard
$9,261
10,002
11' 299
12,410
14,818
18,523
22,227
25,746
29,081
32,229
35,193
37,97 2
40,564
42,972
2,223
Prevai 1 ing
Family
Standard
$13,885
14,996
16,940
18,606
22,216
27,770
33,324
38,600
43,599
48,320
52,763
56,929
60,816
64,426
3,332
Social
Abundance
Standard
$20,828
22,494
25,410
27,909
33,324
41,655
49,986
57,900
65,399
72,479
79,145
85,394
91,224
96,639
4,999
Source: Calculated from expenditure levels reported in the 1984 Consumer Expenditure
Survey, U.S. Department of Labor, Bureau of Labor Statistics.
1987 No.4 Family Economics Review 5
and other economic changes have appeared in
recent years (_!_, l_, ~) • These reports
describe patterns of spending rather than
identifying the market basket of goods and
services or overall level of expenditures
needed to meet a defined consumption level.
The CES includes extensive detail on
household characteristics, as well as cate­gories
of expense. Consequently, expenditure
patterns of various household types have
been reported. For example, Gieseman and
Rogers (l_) present average weekly and annual
expenditures classified by household income
quintile, age of reference person, region,
household size, and number of earners. Using
expenditure averages, they calculate budget
shares to compare patterns among household
types. They report that although high-income
households spend much more for food and
housing than do low-income households, as a
percent of expenditures, their budget alloca­tions
for these necessities are relatively
low. Whereas high-income households used
only 44% of their budget for food and
housing, low-income households spent 58%.
They also report that 10% of expenditures in
households with a reference person 65 years
or over was spent for health care, versus 3%
in households with a reference person under
25 years.
Another way to compare general welfare
and specific spending patterns among house­holds
is to calculate income shares used for
overall consumption and specific expenses.
For example, based on annual averages re­ported
by Gieseman and Rogers (l_), the dif­ferences
in spending between 1- and 2-earner
households can be calculated and compared
as indicated in the table below.
The table shows that l-earner households
(with significantly lower incomes) spend a
larger portion of their income than do
2-earner households. Food and housing com­prise
a smaller proportional demand on in­come
in 2-earner than l-earner households.
In contrast, transportation claims a similar
share of income in both 1- and 2-earner
families.
The usefulness of CES data in describing
spending patterns of specific types of house­holds,
and therefore as budget guidelines,
is limited by the relatively small size of
the survey samples. Although it would seem
that spending estimates among specifically
defined categories of families would be
highly reliable due to the homogeneity of
the groups, Helmick (1) reported the CES
sample was inadequate to reliably measure
expenditures in households classified
according to several specific character­istics.
Using 1980 diary data, 4 she found
the sample dropped from 10,433 diaries to
103 when the following household qualifiers
were imposed: Reference person with a high
school education, annual income between
$10,000 and $30,000, the presence of two
parents and at least one child, and living
in the North Central region. The coefficient
of variation and measure of relative varia­tion,
indicators of stability of means and
variation among groups (J_), were calculated
for several expenditures. Helmick concluded
4 The CES methodology combines both
1-week diary surveys from the more than
5, 000 consumer units in the sample to create
a data file containing in excess of 10,000
diaries.
Portion of household income
Annual Total Food Housing Transpor- Health Insurance Other
income expendi- tat ion expenses
tures
l-earner
households ••• $22,107 87 .3 16.5 27.9 15.8 4.3 6.8 16.0
2-earner
households ••• 30,661 78.8 13.3 23.8 16.5 2.6 8.4 14.2
6 Family Economics Review 1987 No.4
that variation was so great for some cate­gories
of expense that not even ranges of
expense, much less mean levels, could be
used to develop useful budget guidelines. In
most cases, the sample size that resulted
when family types were specifically defined
reduced the reliability of the expenditure
estimates.
Analysis of the 1982-83 interview data
indicates similar problems in developing
specific budget guidelines from CES data.
The sample size dropped from 4,342 to 193
when only households in the middle-income
quintile and those comprising four members
were included in analysis. The standard
deviation and measure of relative variation
in mean expenditures among broadly versus
specifically defined groups of households
(such as all households versus middle-income,
4-person households) was equally large in
almost all categories of expense. This sug­gests
that high within-group variability
exists in household expenditures and that
the variability is not diminished when
demographically homogeneous households are
grouped together.
The analysis indicated several factors to
consider when evaluating the variablility
and reliability of expenditure averages
calculated from CES data:
Longer measurement periods, combining
data from several quarters or survey years,
have less variability in expenditure means
than shorter periods.
Larger or continuing expenses, such as
housing and food, have less variablility in
expenditure means than small expenditures.
Necessities, such as food and utilities,
have less variability in expenditure means
than luxury items.
In sum, general guidelines for spending
over long periods of time, especially for
necessities, are more likely to be statistically
valid than specific guidelines developed
from CES data.
Expenditure Aggregates
The most frequently released Federal data
on consumer expenditures is the Personal
Consumption Expenditure (PCE) component of
the National Income and Product Accounts.
The PCE is calculated as part of the proce­dures
to estimate Gross National Product.
PCE data are not based on household reports
of spending. Rather, expenditure levels are
aggregated from retail sales reports, real
estate transactions, and other business and
industry reports.
Although PCE data provide little guidance
to specific households in managing their re­sources,
the aggregates show overall patterns
of consumer spending useful to analysts and
policy makers assessing the status of the
consumer sector of the economy. The data are
especially useful in measuring changes over
time. Tables 4 and 5 (p. 8) show the
changing pattern of personal consumption
during the past decade.
In Table 4 expenditures are categorized in
a way comparable to family budget guidelines.
The PCE data show a decline in expenditure
shares for food, clothing, and housing since
1978. At the same time, medical care and
personal business expenses have increased as
a portion of spending. Table 5, which is
arrayed according. to groupings used in
aggregate economic analysis, also indicates
the growing importance of expenditures for
services. Between 1978 and 1987, expendi­tures
for services, adjusted for increases
in prices, grew from 45.6% of PCE to 49 .2%.
This signals an important change in the
economy. Similarly, other trends can be
identified by monitoring PCE data.
FUTURE BUDGET GUIDELINE DEVELOPMENT
Scientific standards of need and social
standards of adequacy· may exist for many
areas of consumer expense, but large
national data sources indicate wide varia­bility
in actual consumer spending patterns.
In the face of wide and apparently growing
variability in spending, normative or
statistically based family budget guidelines
will be difficult to develop. Efforts to
create computer-based expert systems and
decision-making aids, based on research
showing the relationship of spending
patterns to the achievement of economic
goals and well-being, may be the best avenue
for developing new family budget guidelines.
1987 No.4 Family Economics Review 7
Table 4. Personal consumption expenditures (budget shares)
[Calculated from levels adjusted to 1982 prices)
Items
Food and tobacco ••••••.•••• •••••••••
Clothing, accessories, jewelry •••••.•
Personal care •••••••.••••..••••••••••
Housing ••.•••• •··•· • • • • · · · • · · · • • • • • •
Household operation ••..••••••••.••.•
Medical care ••••••.••.•••••••••••..••
Personal business •••••••..•....•••••
Transportation •••••.•...••••••••• · ••
Recreation .••••••••••..••••••••••.••
Private education and research .••.••
Religious and welfare activities ..•••
Foreign travel (net) .••••..••••...•••
1978
21.9
8.0
1.4
15.9
13.6
9.4
5.3
14.7
6.6
1.5
1.4
.3
1980
21.6
7.5
1.4
16.1
13.8
9.9
5.6
14.4
6.4
1.6
1.4
.3
1982
(percent)
20.7
7.5
1.5
15.7
13.3
12.0
5.7
13.0
6.7
1.5
2.2
.2
1984
19.7
7.5
1.5
15.3
13.1
12.2
6.1
13.5
6.8
1.6
2.2
.5
1985
19.2
7.4
1.5
15.5
12.7
12.5
6.6
13.5
6.8
1.6
2.2
.5
Source: U.S. Department of Commerce, Bureau of Economic Analysis, 1986,
Vol. 66, No. 7.
Surve:y of Current Business,
Table 5. Personal consumption expenditures (budget shares)
[Calculated from levels adjusted to 1982 prices)
Items 1978 1980 1982 1984 1985 1986 1987 1
(percent)
Durable goods ••••••••••••••••.•.• 16.2 14.8 12.3 14.3 14.8 15.3 14.8
Motor vehicles and parts ....... 7.3 5.8 5.3 6.5 6.7 6.8 6.0
Furniture and household
equipment ••••..••••••.•.•••••. 6.2 6.5 4.7 5.3 5.5 5.8 6.0
Other 2 ••••••••••••••••••••••••• 2.7 2.5 2.3 2.5 2.6 2.7 2.8
Nondurable goods ................ 38.2 38.3 37.6 36.9 36.1 36.0 35.9
Food ••••••••..••..••.••••••••.• 19.1 19.4 19.5 18.9 18.6 18.2 18.1
Clothing and shoes .••••••••••.• 8.1 8.4 6.1 6.4 6.3 6.4 6.5
Gasoline and oil •.•.•••••••••••• 3.2 2.8 4.3 4.2 4.1 4.3 4.9
Fuel oil and coal ••••••••••••••. .5 .4 .9 .8 .7 .8
Other 3
••••••••••••••••••••••••• 7.3 7.3 6.8 6.6 6.4 6.3 6.4
Services ••..•••.•...•••...••••..••• 45.6 47.1 50.1 48.8 49.0 48.6 49.2
Housing .••••.•.••••.••••••••••• 16.7 17.2 15.7 14.9 14.8 14.5 14.6
Household operation •.•••••••••• 6.3 6.6 7.0 6.6 6.5 6.2 6.2
Transportation ••••••••••••••••• 3.7 3.7 3.4 3.3 3.5 3.5 3.6
Medical care ••••.•••.••••.•••••• 7.6 8.0 10.6 10.2 10.2 10.2 10.3
Other~ •••.•...•••••••••••••••.• 11.3 11.6 13.4 13.8 14.0 14.2 14.5
1 First quarter data.
2 Wheel goods, durable toys, sports equipment, boats, and pleasure aircraft; jewelry and watches;
and books and maps.
3 Tobacco, toiletries, cleaning chemicals, drugs, sundries, nondurable toys, and stationery.
~Personal care, personal business, recreation, private education and research, religious
activities, and net foreign travel.
Source: U.S. Department of Commerce, Bureau of Economic Analysis, 1986, Surve:y of Current
Business, Vol. 66, No. 7.
8 Family Economics Review 1987 No.4
REFERENCES
1. Bloom, David E., and Sanders D.
Korenman. 1986. The spending habits
of American consumers. American
Demographics 8(3):22-25-:-51-54.
2. Community Council of Greater New York,
Budget Standard Service. 1986. Annual
Price Survey--Family Budget Costs,
October 1985.
3. Gieseman, Raymond, and John Rogers.
1986. Consumer expenditures: Results
from the Diary and Interview surveys.
Monthly Labor Review 199(6): 14-18.
U.S. Department of Labor, Bureau of
Labor Statistics.
4. Helmick, Sandra A. 1985. Expert
Systems for Family Budgeting. Paper
presented at the North Central
Computer Institute Workshop, Computer
Applications for Family Financial
Management Professionals. [St. Paul,
MN, October 1985.]
5. Kaneer, Kirk. 1986. Research Sum­maries--
Distribution of consumption
examined using aggregate expenditure
shares. Monthly Labor R~view 109(4):
50-53. U.S. Department of Labor,
Bureau of Labor Statistics.
6. LePlay, Frederic. 1878. Les Ouviers
Europeens [The lives of Europeans.]
(2d ed.) Paris.
7. Martin, J. David, and Louis N. Gray.
1971. Measurement of relative varia­tion:
Social examples. American
Sociological Review 36 (June): 496-502.
8. Monroe, Day. 197 4. Pre-Engel studies
and the work of Engel: The origins of
consumption research. Home Economics
Research Journal 3 (1): 43-65.
9. Shipp, Stephanie, and John Rogers.
1986. Overview of the Consumer Expen­~
i!l}.!'~-~_}lrvey~_!'Qgram. Paper presented
at the 32d Annual Conference of the
American Council on Consumer Interests.
[St. Louis, MO, April 1986.]
10. U.S. Department of Labor, Bureau of
Labor Statistics. 1978. Autumn 1977
Urban Fami!_y Budg~ts and Comparative
Indexes for Selected Urban Areas. News.
USDL Publications No. -7-8---39-3-.--
11. • 1982. Family budgets--Final
report on family budgets: Cost in­creases
slowed, autumn 1981. Monthly
Labor Review 105 (7): 44-46.
12. • 1985. Copsumer Expenditure
Survey: Interview Survey, 1980-81.
Bulletin No. 2225.
13. • 1:986. Consumer Expenditure
Survey: Interview Survey, 1984.
Bulletin No. 2267.
14. Watts, Harold W. 1980. Special panel
suggests changes in BLS Family Budget
Program. ~<211!!!!Y. Labor Review 103(12):
3-10. U.S. Department of Labor,
Bureau of Labor Statistics.
1987 No.4 Family Economics Review 9
Federal Consumer and
Educational Publications
Relating to Family Economics
Joyce Matthews Pitts
Home economist
Household financial decisions affect a
family's level of living. To make intelligent
decisions, families require a variety of infor­mation.
Several departments, agencies, and
commissions of the Federal Government publish
consumer and educational materials that can
aid in making sound economic decisions. Dis­semination
of information that provides the
public with interpretative results from
research and study findings is often an
integral part of a Federal agency's mission.
Some agencies collaborate with private
industry and businesses to provide consumers
with publications that furnish clear
explanations of technical developments.
Government publications are available to
the general public, usually at low or no
cost. Many can be obtained from more than
one source--the originating agency, the
Government Printing Office (GPO), and the
Consumer Information Center. GPO handles a
large inventory of books, magazines, pam­phlets,
posters, and maps (about 16,000
titles) and regularly issues subject matter
catalogs and bibliographies. GPO Subject
Bibliography SB-002, for example, lists
current consumer information publications.
There are also bibliographies available on
such subjects as children and youth; food,
diet, and nutrition; day care; higher educa­tion;
energy management; gardening; and
home economics. With the exception of the
catalogs and bibliographies, GPO does not
distribute free materials. There are 24 GPO
bookstores throughout the country in
addition to their mail order service.
The Consumer Information Center (CIC)
helps Federal agencies promote and distribute
useful consumer information. Publications
may be distributed free when the issuing
agency is able to pay printing and distribu­tion
costs. CIC issues four consumer infor­mation
catalogs a year that list the newest
and most popular publications.
10 Family Economics Review 1987 No.4
Following is a list of materials that can
aid in household financial planning and
management. Many will also be useful to
teachers, Extension agents, and other
educators who teach personal finance. When
sufficient supplies are available, some
agencies provide multiple copies for class­room
purposes. Included are publications
with practical information and suggestions
on managing money, and useful information
on consumer laws and probable consequences
of economic trends. General information
publications are listed first, followed by
those related to specific categories of
household expense: Housing, food, transpor­tation,
energy and utilities, children,
saving and investing, credit, insurance,
taxes, and retirement planning. The table
on pages 21-24 gives price and ordering
information for each publication described.
GENERAL FINANCES
Consumer's Resource Handbook
(1986, 91 pp.)
Office of the Special Adviser to the
President for Consumer Affairs and the
U.S. Office of Consumer Affairs
To make good purchasing decisions,
consumers need reliable information about
products, credit, warranties, and services.
The Consumer's Resource Handbook is
designed to help them avoid problems in the
marketplace and effectively resolve any
complaints. This book is divided into two
parts--Part l gives tips on how consumers
can get the best value for their money, and
Part II contains a consumer assistance
directory. The directory lists the names,
addresses, and telephone numbers of key
personnel for consumer programs in industry,
State and local consumer offices, pro­fessional
licensing boards, and Federal
agencies who are responsible for handling
complaints and providing information on a
variety of consumer issues.
Consumers Should Know: How to Buy a
Personal Computer
(1986, 48 pp.)
Published by the Electronic Industries
Association in cooperation with the
U.S. Office of Consumer Affairs and the
Consumer Information Center
Personal computers are versatile tools
that help consumers in educating their chil­rJren,
running a business, or budgeting their
finances. How to Buy a Personal Computer is
a step-by-step guide designed to assist con­sumers
in selecting hardware, software, and
peripherals. This publication· also gives
cost information on computers, disk drives,
monitors, modems, printers, and other
equipment.
Facts for Consumers
(1985-87, 1-4 pp.)
Office of Consumer/Business Education
Bureau of Consumer Protection
Federal Trade Commission
Consumer laws change, and new means for
saving and borrowing are constantly being
offered. Consumers need access to infor­mation
on new services, products, and
regulations, explained in common terms.
Facts for Consumers provides the latest
details on a variety of subjects relating to
finance and credit. Some recent titles of
these one-to-four-page reports include:
Buying a Used Car. (May 1985)
Cellular Telephone Lotteries (January 1986)
The Credit Practices Rule (January 1986)
Fair Debt Collection (December 1986)
Fix Your Own Credit Problems and Save
Money (April 1987)
General Motors Consumer Mediation/
Arbitration Program (January 1986)
Layaway Purchase Plans (February 1986)
Refinancing Your Home (August 1986)
Scoring for Credit (August 1986)
Second Mortgage Financing (August 1986)
Shopping by Phone and Mail (September
1986)
Solving Credit Problems (May 1985)
How to Write a Wrong: Complain
J· , ct vely and Get Results
(1983, 16 pp.)
Published by the American Association
of Retired Persons in cooperation with the
Federal Trade Commission
Most merchants hope to establish a good
reputation. This fact and certain legal
rights give consumers power in resolving
complaints. The grievance process and why
consumers should complain is explained in
this booklet. Included is information on can­celing
a purchase from door-to-door sales,
and ordering products through the mail.
If You Become Disabled
(1986, SSA Pub. No. 05-10029, 31 pp.)
Social Security Administration
U.S. Department of Health and
Human Services
The loss of income because of severe
injury or illness can seriously damage a
family's financial well-being. Social
Security provides basic protection against
disability for most consumers and their fami­lies.
This booklet explains the disability
program, what constitutes a disability, who
can receive benefits, which dependents are
eligible, and how to apply. Related publica­tions
offered by the same office are:
Social Security for the Young Worker.
SSA Pub. No. 05-10063
Your Social Security Rights and
Responsibilities: Disability Benefits
SSA Pub. No. 05-10153
Money Matters: How to Talk to and Select
Lawyers, Financial Planners, Tax
Preparers, and Real Estate Brokers
(1986, 12 pp.)
Published by the American Association of
Retired Persons in cooperation with the
Federal Trade Commission
This guide assists families and individuals
wanting professional help with their legal
and financial affairs. Money Matters
suggests how to decide when professional
advice is needed; select the right lawyer,
financial planner, tax preparer, or real es­tate
broker; evaluate professional services;
keep good financial records; and complain
when services rendered are unsatisfactory.
1987 No.4 Family Economics Review 11
Managing Your Personal Finances
(1986, Home and Garden No. 245, 90 pp .)
Agricultural Research Service and
Extension Service
U.S. Department of Agriculture
With so many financial choices to make,
consumers often need help in deciding where
to invest, whether to purchase a house, or
how much to spend on food and other
expenses. This workbook is designed to help
them use the budgeting process to meet their
financial goals. Managing Your Personal
Finances is divided into three sections: The
Principles of Managing Your Finances helps
consumers make a working budget; Financial
Tools Used in Money Management gives infor­mation
on savings, insurance, and credit;
and Coping With Change suggests ways to
adjust to retirement and changes in the
economy.
HOUSING
Buying a Home? Don't Forget the Settlement
Costs
(1980, HUD-342-H(9), 1-page pamphlet)
Office of Public Affairs, U.S. Department of
Housing and Urban Development
In addition to the cash required for a
downpayment, homebuyers must have money
for settlement. This brochure describes the
settlement process and costs. It defines and
explains many of the terms associated with
mortgages and real estate closings--such as
origination, settlement, and escrow fees;
points; reserve accounts; and title insurance.
Buying Lots From Developers
(1982, HUD-357-I(6), 20 pp.)
U.S. Department of Housing and Urban
Development
Consumers may purchase land for
investment purposes or as a site for a
future residence, retirement home, vacation
cabin, or campsite. Whatever the reason,
each purchaser must decide if the property
is a good buy. This booklet is written to
help prospective lot buyers obtain necessary
information before spending money. Topics
discussed in Buying Lots From Developers in­clude
heeding related laws and regulations,
12 Family Economics Review 1987 No.4
researching the lot, investigating the
developer's reputation, using the right to
cancel a contract, and knowing where to
complain about dishonest sales practices.
How to Buy a Manufactured Home
(23 pp.)
Published by the Manufactured Housing
Institute in cooperation with the
Federal Trade Commission
Office of Consumer and Business Education
Manufactured homes (referred to as mobile
homes in the past) comprise about one-third
of all new single-family homes purchased in
recent years. How to Buy a Manufactured
Home explains how to choose an affordable
unit, which options and features to consider,
what local regulations must be met, and how
the home should be transported and installed
on the permanent site.
To the Home-Buying Veteran: A Guide for
Veterans Planning to Buy or Build Homes
With a VA Loan
(1984, VA pamphlet 26-6, 34 pp.)
Department of Veterans Benefits
Veterans Administration
Mortgage loans insured by the Veterans
Administration (VA) usually offer one of the
lowest interest rates available to consumers.
To the Home-Buying Veteran is designed to
assist those who are planning to purchase or
construct homes. Topics discussed include
selecting a house, determining initial costs
and future expenses, deciding what a sales
contract should include, and considering the
responsibilities related to the repayment of
a loan. This booklet has useful information
for both veterans and non veterans. Related
publications from the Veterans Administration
include:
VA -Guaranteed Home Loans for Veterans
(VA Pamphlet 26-4)
Pointers for the Veteran Homeowner
(VA Pamphlet 26-5)
FOOD
Making Food Dollars Count: Nutritious
Meals at Low Costs
(1983, Home and Garden Bulletin No. 240,
26 pp.)
Human Nutrition Information Service
U.S. Department of Agriculture
Making Food Dollars Count provides sample
me.{ll plans and suggestions on ways to buy
and use food in order to serve nutritious,
low-cost meals and snacks to a family of
four for 2 weeks. Menus witJ:l food shopping
lists and recipes that emphasize economical
foods are included. The meal plans are based
on consumers' food shopping habits as
indicated by national surveys.
Your Food Dollar in Perspective
(1986, 1-page pamphlet)
Federal Reserve Bank of Richmond
Even though food prices have risen,
consumers now spend a smaller percentage of
their income on food than ever before. This
educational brochure looks at the cost of
food in the United States and explains how
food prices are measured and what makes
food prices change.
Your Money's Worth in Foods
(1984, Home and Garden Bulletin No. 183,
39 pp.)
Human Nutrition Information Service
U.S. Department of Agriculture
Proper management of the food budget
results in good nutrition and increased
eating pleasure. Your Money's Worth in Foods
is for consumers who want to economize on
their food budget; and for teachers, Exten­sion
agents, and other professionals who
advise families about budgeting for food. It
includes many practical suggestions on how
to balance costs and nutrition. Topics dis­cussed
include when and where to shop, how
much to spend for food, how much food to
buy, planning menus, and reducing food costs
and waste.
TRANSPORTATION
A Consumer Guide to Vehicle Leasing
(16 PP•)
Published by the Federal Trade Commission
in cooperation with the New Car Dealers
Association of Metropolitan Dallas and the
National Vehicle Leasing Association
Recent changes in Federal income tax laws
will phase out deductions for sales taxes
and finance charges on cars and other pur­chases.
Many consumers are now considering
the advantages of leasing versus purchasing
cars, trucks, and vans for long-term,
personal use. A Consumer Guide to Vehicle
Leasing lists the different types of leasing
plans covered by the 1976 Consumer Leasing
Act and explains the costs and characteris­tics
of each type of plan. This guide also
reviews consumer rights and liabilities in
vehicle leasing.
The Cost of Owning and Operating
Automobiles and Vans
(1984, HHP-41/5-84(150M)QF, 20 pp.)
Office of Highway Planning
Federal Highway Administration
U.S. Department of Transportation
Studies show that the average passenger
vehicle stays on the road for about 12 years
and 120,000 miles, and is sold or traded at
least twice. Eventually, all vehicles will
need some type of repairs, but costs can
vary. In addition to the initial purchase
price, consumers need to know what they can
expect to pay in operating costs. This book­let
traces the cost of owning selected vehi­cles
through a 12-year, 120, 000-mile lifetime.
Yearly costs are determined for large,
intermediate, compact, and subcompact cars,
and for passenger vans. Costs are given for
depreciation, maintenance, gas and oil,
parking and tolls, insurance, and taxes.
1987 No.4 family Economics Review 1J
ENERGY AND UTILITIES
How to Buy a Telephone
( 1984, 1-page pamphlet)
Published by the Electronic Industries
Association in cooperation with the
U.S. Office of Consumer Affairs and the
Consumer Information Center
General Services Administration
Since divestiture of the telephone company,
consumers have a choice of telephone
services and equipment. This pamphlet gives
information on how to save money by pur­chasing
a telephone and describes the kinds
that are available. Questions concerning
features to consider when purchasing a tele­phone,
disposal of rented equipment, and the
relative cost of renting versus buying are
answered.
In the Bank or Up the Chimney: A Dollars
and Cents Guide to Energy-Saving Home
Improvements
(1980, HUD-PDR-89(5), 76 pp.)
Office of Policy Development and Research
U.S. Department of Housing and Urban
Development
Heating and cooling a home can be costly.
However, there is reliable information to
help consumers save money on utilities • .!.!:!.
the Bank or Up the Chimney is the result of
research sponsored by the Department of
Housing and Urban Development (HUD) on
ways to conserve energy. Detailed
information is given on how .to make such
home improvements as caulking, weather
stripping, insulating, and installing storm
windows and doors. A method for determining
the savings factor of each energy-saving
technique is also described.
14 Family Economics Review 1987 No.4
Tips for an Energy Efficient Apartment
(1985, DOE/CE/24423-1, 22 pp.)
Office of Conservation and Renewable
Energy
U.S. Department of Energy
Most of the energy used in apartment
buildings comes from nonrenewable
resources--natural gas and oil. It is,
therefore, important that these resources be
used wisely until new energy sources are
available. This booklet contains information
on low-cost measures that can help tenants
save money on their utility bills by con­serving
energy consumption. Included are
energy saving tips for heating, cooling, and
lighting homes, and for conserving water and
energy when using appliances.
Tips for Energy Savers
(1986, DOE/CE-0143, 29 pp.)
U.S. Department of Energy
The heating and cooling of homes consumes
48% of total residential energy use. Energy
costs can be cut by making homes more
energy efficient. Tips for Energy Savers
explains the use of caulking, weather
stripping, insulating, and the efficient use
of heating equipment, air conditioners,
water heaters, and home appliances. Also
included are tips on how to buy or build an
energy efficient home and how to maintain
automobiles for maximum energy efficiency.
Your Keys to Energy Efficiency
(1985, 19 pp.)
Published by the U.S. Office of Consumer
Affairs and the Division of Consumer Affairs
U.S. Department of Energy
Consumers often spend more money than
necessary on water, gas, and electricity.
Saving energy can save money and conserve
domestic energy resources. The purpose of
this guide is to provide relevant informa­tion
that can assist consumers in using
energy efficiently. Topics include saving
energy at home, driving conservatively, and
becoming a wise energy consumer.
CHILDREN
Kids. They're Worth Every Penny. Handbook
on Child Support Enforcement
(1985, 40 pp.)
Office of Child Support Enforcement
U.S. Department of Health and Human
Services
The 1984 Child Support Enforcement
Amendments require States to improve their
effectiveness in providing support enforce­ment
services to families. This book gives
custodial parents the basic steps to follow
when child support enforcem.ent services are
needed. Suggestions for locating an absent
parent, establishing and enforcing the sup­port
order obligation, and working across
State lines to receive payments are provided.
The Student Guide: Five Federal Financial
Aid Programs
(1987' 60 pp.)
U.S. Department of Education
More than 12 million Americans are
continuing their education beyond high
school. This booklet is for those who need
assistance in paying their tuition. It des­cribes
five U.S. Department of Education
programs that can help--Pell Grants, Supple­mental
Educational Opportunity Grants,
College Work-Study, Perkins Loans, and
Guaranteed Student Loans. Also included is
information on how to apply for these
loans.
The Story of ••••
(1980-85, 21-24 pp.)
Public Information Department
Federal Reserve Bank of New York
Children benefit from an early under­standing
of the value of money. The Federal
Reserve Bank has several comic-book-type
publications aimed at teaching junior and
senior high school students the relationship
between money and the economy. They
include:
The Story of Banks (1985)
The Story of Checks and Electronic
Payments (1983)
The Story of Consumer Credit (1980)
The Story of Foreign Trade and
Exchange (1985)
The Story of Inflation (1982)
The Story of Money (1984)
Wishes and Rainbows
(1981, 16 pp.)
Public Services Department
Federal Reserve Bank of Boston
Wishes and Rainbows, color illustrated,
tells the story of a fictitious city where
colors do not exist. It can be a valuable
tool for teaching elementary and junior high
school children the economic concepts of
scarcity, supply, demand, and allocation.
The Road to Roota is an accompanying
teacher's guide that suggests how Wishes and
Rainbows can be used for group discussions.
SAVING AND INVESTING
Buying Treasury Securities at Federal
Reserve Banks
(1983, 30 pp.)
Federal Reserve Bank of Richmond
The U.S. Department of the Treasury
raises funds by selling marketable securities
to the general public. This book explains
Treasury bills, notes, and bonds--when they
are offered for sale, how and where they may
be purchased, and how to receive payment
when they mature.
Investigate Before You Invest
(1986, 1-page pamphlet)
U.S. Securities and Exchange Commission
Millions of consumers own corporate stocks
and bonds. These invested savings help
provide capital for industry, new products
for the consumer, and income for the
investor. Investigate Before You Invest
provides information on what Federal laws
protect investors and lists simple rules
consumers can follow when considering the
purchase of securities.
The Savings Bonds Question and Answer Book
(12 pp.)
Savings Bonds Division
U.S. Department of the Treasury
U.S. savings bonds have become a
competitive investment. This question and
answer booklet explains many of the charac­teristics
of savings bonds including what
kinds are available and where they can be
purchased, how much interest they pay,
when they mature, and the maximum amount
that can be purchased annually.
1987 No.4 Family Economics Review 15
Understanding Opportunities and Risks in
Futures Trading
(1986, 45 pp.)
National Futures Association
Buyers and sellers of commodities do
business in futures markets. This brochure
explains the commodities market and provides
consumers with the kinds of questions they
should have answered before investing, such
as what risks are involved, how liquid is
the investment, and how financially secure
is the firm dealing in commodities.
What Every Investor Should Know
(1986, 36 pp.)
Office of Public Affairs
U.S. Securities and Exchange Commission
Today there are more types of investments
available to consumers than ever before.
"Securities" includes a broad range of
investment instruments--stocks, bonds,
mutual funds, investment contracts, limited
partnerships, and real estate investment
trusts. What Every Investor Should Know
provides information on several categories
of securities and explains the protection
provided to investors by Federal law. Topics
discussed include how to choose an invest­ment,
types of brokers, trading on the open
market, and investment companies.
Your Insured Deposit
(14 pp.)
Federal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation
(FDIC) insures consumer bank accounts up to
$100,000. Not all banks are federally insured,
however. This pocket-sized booklet explains
the FDIC operation and how it protects bank
depositors against loss. The various types
of accounts that may be insured are
described. Other publications of interest
from FDIC include:
Truth in Lending
Fair Credit Billing
Fair Credit Reporting Act
Equal Credit Opportunity and Age
16 Family Economics Review 1987 No.4
CREDIT
Alice in Debitland: Consumer Protections
and the Electronic Fund Transfer Act
(1980, 16 pp.)
Board of Governors of the Federal Reserve
System
Electronic fund transfer systems (EFT)
allow payments between parties through elec­tronic
signals instead of cash or checks.
This booklet describes the types of EFT
systems, how they work, and laws that affect
their use. Questions are answered concerning
user records of EFT transactions, correction
of errors, and consumer liability in the
event debit cards are lost or stolen.
The Arithmetic of Interest Rates
(1984, 33 pp.)
Federal Reserve Bank of New York
This booklet explains how consumers can
calculate simple and compound interest rates
on loans and investments. It also includes
information on how to figure monthly payments
on home mortgages and installment loans.
Buying and Borrowing: Cash in on the Facts
(1986, 17 pp.)
Published by the Federal Trade Commission
in cooperation with the U.s. Office of
Consumer Affairs
Most consumers will use credit at one time
or another. Before entering into a credit
agreement they should be aware of problems
that might occur. Buying and Borrowing
discusses solving credit problems, cosigning
a loan, getting warranty protection, shopping
by phone and mail, using layaways, and other
considerations when buying on credit.
Consumer Handbook on Adjustable-Rate
Mortgages
(1984, 25 pp.)
Federal Reserve Board and the Federal Home
Loan Bank Board
The interest rate on a fixed-rate mortgage
remains the same throughout the life of the
loan. The rate on an adjustable-rate
mortgage (ARM) changes periodically. To
compare one ARM to another or to a
fixed-rate mortgage, consumers need to have
a knowledge of indexes, margins, discounts,
caps, convertibility, and negative
amortization. This booklet explains these
terms and the risks and advantages to ARM's,
and suggests ways to reduce the risks. It also
helps consumers decide whether an ARM is
an appropriate financial choice for their
circumstances.
Consumer Handbook to Credit Protection Laws
(1986, 44 pp.)
Board of Governors of the Federal Reserve
System
Truth in Lending legislation, passed in
the late sixties, requires that ·creditors
state the cost of borrowing in language that
consumers can understand and use to com­pare
costs. This handbook explains consumer
credit laws and how they help consumers
determine the cost of using credit. Included
is information on what creditors look for
when extending credit, how to maintain good
credit histories, and how to correct mistakes
in their credit report.
The Mortgage Money Guide
(1986, 16 pp.)
Federal Trade Commission
Many types of mortgages are now available.
Some of the newer plans have resulted from
unpredictable interest rates and housing
purchase prices. Most new plans require that
the borrowers assume some of the risk of
increased interest rates. Other types of
mortgages assist those who would not
otherwise qualify for a loan because of
insufficient income. This guide defines
flexible-rate, graduated-payment, growing­equity,
and shared-appreciation mortgages.
Tables are provided to help consumers
estimate monthly principal and interest
costs.
The Rule of 78's or What May Happen When
You Pay Off a Loan Early
(1979, 1-page pamphlet)
Department of Consumer Affairs
Federal Reserve Bank of Philadelphia
Installment loans usually require that
borrowers pay most of the interest early in
the life of the loan. Creditors use a
mathematical formula (the rule of 78's) to
determine how much interest is charged at
any point. This brochure explains that
formula and shows consumers how to deter­mine
the amount of interest they can save
by paying off a loan early. Other brochures
of interest from this office include:
How to Establish and Use Credit
Your Credit Rating
INSURANCE
A Consumer's Guide to Life Insurance
(21 pp.)
Published by the American Council of Life
Insurance in cooperation with the Extension
Service, U.S. Department of Agriculture
and the Consumer Information Center
The primary purpose of life insurance is
to protect a family against the loss of an
earner. Recently, however, life insurance
has been combined with investment plans to
earn money for a wide range of goals. This
booklet helps consumers make decisions about
life insurance by explaining how to decide
among the various types of policies, how to
choose a company, how much insurance to
buy, and how to compare costs.
Guide to Health Insurance for People With
Medicare
(1985, Pub. No. HCFA 02110, 19 pp.)
Health Care Financing Administration
U.S. Department of Health and Human
Services
Although medicare covers a large part of
health care expenses for the elderly, it
does not pay for everything. This booklet
explains what medicare pays and can help
consumers avoid duplicate coverage when
purchasing supplemental insurance. In
addition, Guide to Health Insurance for
People with Medicare helps the elderly
consumer determine whether supplemental
insurance is needed. Types of private
insurance and hints on shopping for
insurance are included. '
1987 No.4 Family Economics Review 17
Medicare and Prepayment Plans
(1987. Pub. No. HCFA 02143, 1-page pamphlet)
Health Care Financing Administration
U.S. Department of Health and Human
Services
Health maintenance organizations (HMO's)
and competitive medical plans (CMP's) offer
consumers low-cost preventive health care.
Many HMO's and CMP's have Government
contracts to provide services to medicare
beneficiaries. This pamphlet describes these
health plans and the services they typically
offer. Two related publications are:
Medicare and Employer Health Plans
(Pub. No. HCFA 02150)
What Everyone Should Know About HMOs
TAXES
Farmer's Tax Guide
(1986, Pub. 225, 84 pp.)
Internal Revenue Service
U.S. Department of the Treasury
The Farmer's Tax Guide explains how the
Federal income tax law applies to farming.
Subjects discussed include the importance of
good records, accounting periods and
methods, farm income, farm business expenses,
soil and water conservation expenditures,
and the self-employment tax. Explanations
and examples are given for determining taxes
and filling out returns.
Federal Income Tax Guide for Older
Americans
(1987, Comm. Pub. No. 99-603, 18 pp.)
Select Committee on Aging
House of Representatives
U.s. Congress
This tax guide is designed for older
consumers of moderate income. It not only
emphasizes tax issues that affect the
elderly. but discusses each section of the
income tax form. Federal Income Tax Guide
for Older Americans describes IRS publica­tions
and prerecorded messages, and contains
18 family Economics Review 1987 No.4
specific information on who must file, which
form to use, getting assistance in preparing
forms, taxation of Social Security and
Railroad Benefits, and income tax form
preparation. This publication is updated
each year to include the latest tax
information.
Guide to Free Tax Services
(1986, Pub. 910, 27 pp.)
Internal Revenue Service
U.S. Department of the Treasury
Guide to Free Tax Services describes the
publications that are most often requested
by taxpayers. It also describes the services
that are available to help consumers prepare
their Federal income tax returns.
Helping Older Americans to A void
Overpayment of Income Taxes
(1987. Serial No. 100-A, 16 pp.)
Special Committee on Aging
The Senate
U.s. Congress
This publication is designed to assure
that older taxpayers claim every legitimate
income tax deduction, exemption, and tax
credit that is due them. It includes a
checklist of itemized deductions to assist
consumers in preparing their tax returns.
The booklet is updated each year.
Tax Information for Older Americans
(1986. Pub. 554. 53 pp.)
Internal Revenue Service
U.S. Department of the Treasury
This booklet gives basic tax information
of special interest to older taxpayers.
Topics discussed in detail include specific
tax benefits for the elderly. Social Secur­ity
and equivalent Railroad Retirement
benefits, the sale of a home, taxable and
nontaxable income, and calculating taxes.
This publication is updated each year.
Your Federal Income Tax
(1986, Pub. 17, 200 pp.)
Internal Revenue Service
U.S. Department of the Treasury
Updated each year, Your Federal Income
Tax discusses each part of the Federal return
and explains the related tax laws. Income,
adjustments to income, itemized deductions,
credits, and gains and losses are discussed
in detail. Completed forms and sources of
additional information are also provided.
Other publications of interest to taxpayers
include:
Highlights of 1986 Tax Cha:nges (Pub. 553)
Is My Withholding Correct? (Pub. 919)
RETIREMENT PLANNING
Estimating Your Social Security Retirement
Check
(1985, SSA Pub. No. 05-10070, 1-page
pamphlet)
Social Security Administration
U.s. Department of Health and Human
Services
Many consumers would like to know how
much their future Social Security checks will
be. Workers who reach age 62 after 1980 can
get an approximate answer in this leaflet.
Actual earnings for past years are indexed
to take into account changes in wages since
the year they were earned. T bese adjusted
earnings are then averaged, and the benefits
rate calculated for this average. Publica­tions
that provide similar information are:
How You Earn Social Security Credits
(SSA Pub. No. 05-10072)
Thinking About Retiring?
(SSA Pub. No. 05-10055)
How Work Affects Your Social Security
Checks (SSA Pub. No. 05-10069)
A Guide to Planning Your Retirement
Finances
(1982, Comm. Pub. No. 97-354, 32 pp.)
Prepared by the Action for Independent
Maturity, American Association of Retired
Persons, for the
Select Committee on Aging
The House of Representatives
U.S. Congress
Many consumers reach retirement ill­prepared
to provide for their financial
security. This booklet is designed to help
workers begin planning for their retirement.
Topics include budgeting for now and for
retirement, anticipating retirement income,
and estate planning.
Preparing for Widowhood
(1981, Comm. Pub. No. 97-299, 38 pp.)
Subcommittee on Retirement Income and
Employment
Select Committee on Aging
The House of Representatives
U.S. Congress
Although the average wife outlives her
husband by 11 years, many are uninformed
about family finance and are unprepared to
assume financial self-sufficiency. This book­let
suggests steps that women can take to
prepare themselves for living without a
spouse. Subjects discussed include Social
Security, pensions, credit, insurance,
estate planning, education, and employment.
What You Should Know About the Pension
Law
(1985, 57 pp.)
Office of Pension and Welfare Benefit
Programs
U.S. Department of Labor
What You Should Know About the Pension
Law explains the minimum standards for
pension plans in private industry. It covers
how benefits are accrued, how periods are
counted for vesting, how a break in service
can affect benefits, and when retirees can
receive payments. This publication also
discusses other retirement arrangements
including individual retirement accounts
(IRA's), employee stock ownership plans
(ESOP), and the 401(K) salary reduction
plan.
1987 No.4 Family Economics Review 19
A Woman's Guide to Social Security
(1986, SSA Pub. No. 05-10127, 15 pp.)
Social Security Administration
U.S. Department of Health and Human
Services
Most Americans have Social Security
protection. However, certain parts of the
system are particularly relevant for women.
Information in this guide explains how
career interruptions, marriages, widowhood,
divorce, and second marriages impact on a
woman's Social Security benefits. Other
useful guides for men and women are:
Your Social Security
(SSA Pub. No. 05-10035)
Your Social Security Rights and
Responsibilities: Retirement and
Survivors Benefits
(SSA Pub. No. 05-10077.
Your Home. Your Choice: A Workbook for
Older People and Their Families
(1985, 32 pp.)
Published by the American Association of
Retired Persons in cooperation with the
Office of Consumer and Business Education
Federal Trade Commission
Some elderly persons consider moving for
health or financial reasons. This workbook
can help them learn about a variety of living
arrangements. Information is provided on
ways the elderly can stay in their homes or
change to a more supportive housing option.
Questions throughout the workbook assist in
determining the pertinent facts before a
decision is made. Other subjects addressed
include home health care, house sharing,
congregate housing, and nursing homes.
20 Family Economics Review 1987 No.4
Your Medicare Handbook
(1987, Pub. No. HCFA-10050, 65 pp.)
Health Care Financing Administration
U.S. Department of Health and Human
Services
Health care is an important economic con­sideration
for families, especially elderly
consumers. Medicare, the Federal health
insurance program for the elderly, helps pay
for hospital care, doctors' services, and
some other medical expenses, but does not
pay for everything. Elderly persons should
be aware of which expenses medicare does not
cover. Your Medicare Handbook provides this
and other information about what medicare is
and how it works. Specific topics discussed
include who can provide services and
supplies under Medicare, how payments are
made, how to submit medical insurance
claims, and how to obtain other health
insurance protection. Related publications
include:
Medicare for Federal Employees
(SSA Pub. No. 05-10033)
What You Should Know About Medicare
(SSA Pub. No. HCFA-10043)
Consumer publications that relate to family economics
Name of publication
Alice in De15itland
The Arithmetic of
Interest Rates
Buying and Borrowing:
Cash in on the Facts
Buying a Home?
Buying Lots from
Developers
Buying Treasury Securities
at Federal Reserve Banks
A Consumer Guide to
Vehicle Leasing
Consumer Handbook on
Adjustable Rate Mortgages
Consumer Handbook to Credit
Protection Laws
Consumer's Guide to
Life Insurance
A Consumer's Resource
Handbook
Coat of Owning and Operating
Automobiles and Vans
Estimating Your Social
Security Retirement Check;
How You Earn Social Security
Credits; Thinking About
Retiring: How Work Affects
Your Social Security Checks
Available from
Publication Services, MS138
Board of Governors of the
Federal Reserve System (FRS)
Washington, DC 20551
202-452-3245
Federal Reserve Bank of
New York (FRNY)
Publication Information Dept.
33 Liberty St. , 13th floor
New York, NY 10045
212-720-6134
CIC (425R)
U. S. Department of Housing
and Urban Development (HUD)
451 7th St., SW., Rm. 8141
Washington, DC 20410
202-755-6380
CIC (128R)
Federal Reserve Bank of
Richmond (FRR)
Public Services Department
P.O. Box 27622
Richmond, VA 23261
804-697-8000
CIC (432R)
FRS
FRS
CIC (592R)
CIC (560R)
CIC (433R)
U.S. Dept. of Health & Human
Services (HHS), Social Security
Administration (SSA), Office of
Information, 4-J-10 W. High Rise
6401 Security Blvd.
Baltimore, MD 21235
301-594-2394
(or any SSA regional office)
See footnotes at end of table, p. 24.
Cost
Free 1
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Free
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Free
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Free
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Other sources
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Information
Center (CIC) 2
(449R)
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Office (GP0) 2
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family Economics Review 21
Consumer publications that relate to family economics--continued
Name of publication
Facts for Consumers
Farmer's Tax Guide
Federal Income Tax Guide
for Older Americans
Guide of Free Tax Services
Guide to Health Insurance
for People With Medicare
A Guide to Planning Your
Retirement Finances
Helping Older Americans
to A void Overpayment of
Income Taxes
How to Buy a Manufactured
Home
How to Buy a Personal
Computer
How to Buy a Telephone
How to Write a Wrong
If you Become Disabled;
Social Security for the
Young Worker; Disability
Benefits
In the Bank or Up
the Chimney
Investigate Before You
Invest
Available from
Federal Trade Commission (FTC)
Bureau of Consumer Protection
Publications Business Office
6th St. & Pennsylvania Ave., NW.
Washington, DC 20580
202-326-3650
U.S. Dept. of the Treasury
Internal Revenue Service (IRS)
1-800-424-1040
(or any regional office)
Cost
Free 1
Free
U.S. House of Representatives Free
Select Committee on Aging (HSCA)
712 Annex No. 1
Washington, DC 20515
202-226-3375
IRS Free
HHS, Health Care Financing
Administration (HCFA)
Office of Public Affairs
6325 Security Blvd.
Baltimore, MD 21207
301-597-097 7
HSCA
Free
Free
U.S. Congress, Senate Free
Special Committee on Aging
Senate Dirksen Bldg., Rm. FD-G41
Washington, DC 20510-6400
202-224-5364
ere (418R) so.5o
CIC (421R) $0.50
C IC (569R) Free
CIC (441R) $0.50
HHS Free
HUD Free
U.S. Securities & Exchange Comm. Free
Public Reference Room
450 5th St., NW.
Washington, DC 20549
202-272-7467
See footnotes at end of table, p. 24.
22 family Economics Review 1987 No.4
Other sources Cost
CIC (528R) 2 Free
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05784-4 2
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Continued
Consumer publications !hal relate lo family economics--continued
Name of publication
Kids--They're Worth Every
Penny
Making Food Dollars Count
Managing Your Personal
Finances
Medicare and Prepayment
Plans; Medicare and
Employer Health Plans
Mortgage Money Guide
Available from
ClC (505R)
CIC (410R)
CIC (195R)
HCFA
FTC, Division of Credit
Practices, Publications
6th & Pennsylvania Ave., NW.
Washington, DC 20580
202-326-2222
Money Matters CIC (571R)
Preparing for Widowhood HSCA
Retirement • Survivors Benefits SSA
The Rule of 78's Federal Reserve Bank of
The Savings Bonds Question
and Answer Book
The Story of ••••
The Student Guide
Tax Information for
Older Americans
Tips for an Energy
Efficient Apartment
To the Home-Buying Veteran;
V A-Guaranteed Home Loans;
Pointers for the Veteran
Homeowner
Philadelphia
Dept. of Consumer Affairs
P.O. Box 66
Philadelphia, PA 19105
215-57 4-6115
U.S. Dept. of the Treasury
Savings Bonds Division
Office of Public Affairs
Washington, DC 20226
20 2-634-5377
FRNY
U.S. Department of Education
Public Affairs
400 Maryland Ave., SW.
Washington, DC 20202
202-245-3192
IRS
U.S. Department of Energy
Technical Information Center
P.O. Box 62
Oakridge, TN 37831
615-576-1301
Veterans Administration
810 Vermont Ave., NW.
Washington, DC 20420
202-233-5210
Cor any regional office)
See footnotes at end of table, p. 24.
Cost
Free 1
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family Economics Review ZJ
Consumer publications that relate to family economics--continued
Name of publication Available from Cost
Understanding Opportunities
and Risks in Futures
Trading
Commodity Futures Trading Comm. Free 1
Office of Communications and
Education Services
2033 K St., NW.
Washington, DC 20581
202-254-8630
What Every Investor Should
Know
SEC Free
What Everyone Should Know
About HMOs
What You Should Know About
the Pension Law
Wishes and Rainbows;
The Road to Roota
A Woman's Guide to Social
Security; Your Social Security
HCFA
U.S. Department of Labor
Office of Pensions, Rm. N-5666
200 Constitution Ave., NW.
Washington, DC 20210
202-523-8921
Federal Reserve Bank of Boston
Public Information Center
Boston, MA 02106
617-973-3459
SSA
Your Federal Income Tax; IRS
Highlights of 1986 Tax Changes;
Is My Withholding Correct?
Your Food Dollar in FRR
Perspective
Your Keys to Energy
Efficiency
Your Home, Your Choice
Your Insured Deposit;
Truth in Lending;
Fair Credit Billing; Fair
Credit Reporting Act; Equal
Credit Opportunity and Age
Your Medicare Handbook;
Medicare for Federal
Employees; What You Should
Know About Medicare
Your Money's Worth in Foods
CIC (585R)
CIC (568R)
Federal Deposit Insurance Corp.
Corporate Communication Office
550 17th St., NW.
Washington, DC 20429
202-898-6996
HCFA
CIC Cl17R)
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(GPO) are as follows : Consumer Information Center-A
P.O. Box 100
(CIC) and the Government Printing Office
Superintendent of Documents
Pueblo, CO 81002
303-948-3334
24 Family Economics Review 1987 No.4
U.S. Government Printing Office
Washington, DC 20402
202-783-3238
New Publications
Single copies of the following are avail­able
from the Federal Trade Commission,
Public Reference Branch, Room 130, 6th St.
and Pennsylvania Ave., NW., Washington,
DC 20580:
Fix Your Own Credit Problems and Save
Money. April 1987. (Pamphlet). Free.
Women and Credit Histories. March
1987. 1-page pamphlet. Free.
The following is available free from the
Consumer Information Center. Write to
Department 592R, Consumer Information
Center, Pueblo, CO 81009:
A Consumer's Guide to Life Insurance.
May 1987. (For more information, see
"Federal Consumer and Educational Publica­tions
Relating to Family Economics," p. 17
of this issue.)
* * * * * * *
Residential Transportation Energy
Consumption Survey: Consumption
Patterns of Household Vehicles 1985
Energy Information Administration
U.S. Department of Energy
In 1985,89% of U.S. households utilized
vehicles regularly for personal transporta­tion.
The Residential Transportation Energy
Consumption Survey (RTECS) was designed to
provide information on how energy is used by
households for personal vehicles. This
report presents data collected in the 1985
RTECS on the annual miles traveled in
personal vehicles, the gallons of fuel con­sumed,
types of fuel used, prices paid for
fuel, and the miles-per-gallon rates of
personal vehicles. Consumption Patterns of
Household Vehicles 198 5 is available for
$8.50 from the Superintendent of Documents,
U.S. Government Printing Office, Washington,
DC 20402. Ask for SN061-003-00521-7.
Agricultural Outlook '88-
Preliminary Program Highlights
The Agricultural Outlook Conference will
be held from December 1 to December 3, 1987,
in Washington, DC. To obtain additional
information about this free Conference or to
register in advance, write: Outlook
Conference, Room 5143 South Building, USDA,
Washington, DC 20250, or call 202-447-6050.
To obtain Conference materials and identi­fication
badge, participants are directed to
the 5th wing bay, lst floor, in the South
Building, 14th Street and Independence
Avenue, SW., Washington, DC.
Beginning Tuesday afternoon, December 1,
and continuing throughout the Conference,
coordinators from four information centers
of the National Agricultural Library (NAL)
will be available in the Library's D.C.
Reference Center to answer questions and to
access NAL's database, AGRICOLA, on com­pact
disk. Individu~;tl searches will be done,
on request, as time permits. A selection of
the latest available resource materials from
the Agricultural Trade and Marketing,
Family, Food and Nutrition, and Food
Irradiation Information Centers will be on
display. The Pork Industry Handbook on
laser disk, which illustrates a full text
database, will also be demonstrated. The
Reference Center is located in Room 1052
South Building, between the 4th and 5th
wings.
On Wednesday, December 2, two of the
sessions will be of particular interest to
consumers and professionals working with
families: The Outlook for Families will focus
on the continuing Consumer Expenditure
Survey, a major data source for pro­fessionals
working in the area of family
economics. The session will be moderated by
Waldemar Klassen, Beltsville Area Director,
Agricultural Research Service. Two of the
speakers will be Thesia Garner, Bureau of
Labor Statistics, and Jane Kolodinsky,
University of Vermont. The Nutrition session
will feature "Linking Production With
Nutritional Concerns," with Orville G.
Bentley, Assistant Secretary for Science and
Education, as moderator. Speakers include
Jane Anderson (California Beef Council),
Barbara Luke (National Academy of Sciences),
and David H. Hurt (Quaker Oats Company).
1987 No.4 Family Economics Review 25
Work Schedules of Americans
A special supplement to the Current
Population Survey (CPS) was conducted
in May 1985 for the Bureau of Labor
Statistics by the Bureau of the Census.
Whereas the CPS, a monthly survey of
approximately 59,500 households, pro­vides
the basic labor force and unem­ployment
data for the Nation, the May
1985 supplement was designed to yield
current information on work sched_ules
and other topics concerning labor force
behavior and work patterns of Ameri­cans.
Also, new information on work­schedule
topics not previously studied
at the national level was collected.
Some of the findings from this special
survey are presented in the following
three abstracts.
Multiple Jobholders 1
In May 1985 multiple jobholders 2
(moonlighters) totaled 5.7 million, 5.4% of
all employed workers. This was up from 4.9%
in 1980 and was the highest level in more
than 20 years. Although men are still more
likely than women to be working at two jobs
or more, there has been a long-term trend in
the increasing number of women among moon­lighters.
Between 1980 and 1985, the number
of women holding multiple jobs rose by 41.5%
to 2. 2 million. In 1985 the moonlighting
1Thes·e data were previously collected each
May in a supplement to the CPS, but annual
supplements were discontinued after 1980.
2 Multiple jobholders are employed persons
who either (1) had jobs as wag~ or salary
workers with two employers or more,
(2) were self-employed and also had a wage
and salary job, or (3) were unpaid family
workers on their primary job but also held
wage and salary jobs. The primary job is the
one at which the greatest number of hours
are worked.
26 Family Economics Rev i ew 1987 No.4
rate for men exceeded that for women by only
1 percentage point, 5.9% compared with 4.7%,
and women made up 38% of all multiple
jobholders. Significant differences still
exist, however, in the types of jobs held by
men and women who moonlight. In 1985 about
40% of the women were working at multiple
part-time jobs, but more than 80% of the men
were working full time at their primary job
and part time at a secondary job.
Married men were more likely to moonlight
than either single men or those who were
widowed, divorced, or separated. Married
women, however, were somewhat less likely
to work at more than one job than were those
without a spouse. Singles of either sex were
more likely than other groups to moonlight
in order to accumulate savings for the
future (see table). Current financial consi­derations
were more prevalent reasons for
moonlighting among widowed, divorced, and
separated workers. More than two-thirds of
the women and almost one-half of the men in
that category cited either the need to meet
regular expenses or to pay off debts as their
reason for working at more than one job.
Persons with primary jobs in the entertain­ment
and recreation services, professional
services (especially educational services),
and public administration were most likely
to moonlight. Men who were employed as
teachers (at and below college level), as
health technologists or health technicians,
or as protective service workers, most
frequently held second jobs. Highest rates
of multiple jobholding occurred among women
who were public officials and administrators,
teachers (at all levels), engineering and
science technicians, or were in health
diagnosing occupations.
Multiple jobholders usually averaged about
14 hours per week on their secondary jobs
and 51 hours per week at all jobs combined.
The average for men, 55 hours per week,
exceeds the women's average by 10 hours.
Source: Stinson, John F., Jr., 1986, Moon­lighting
by women jumped to record highs,
Monthly Labor Review 109(11) :22-25,
U.S. Department of Labor, Bureau of Labor
Statistics.
~
>D
CD .....
z
0 .,.
~
3".. .' .
.....
'< ,..,
n
0
::l
0
3.. ..
n
en
;;c
co
<... .
co
:0:
.... ......
Multiple jobholders, by se.r, marital status, and race; the reason for working at more than one job, May 1985
[Numbers in thousands]
Characteristics
Total, 16 years and over •••
Men, 16 years and over ••
Single ••••••••••••••••••
Married, spouse present
Widowed, divorced, or
separated •••••••••••••
White •.••..............
Black .......... · · · · · · • •
Women, 16 years and over
Single ................. .
Married, spouse present
Widowed, divorced, or
separated •••••••••••••
White ............... · · ·
Black .............. · · · ·
Total
employed
persons
106,878
60,015
14,768
39,444
5,803
53,222
5,240
46,864
11,399
25,999
9,465
40,333
5,176
Total
nultiple
jobholders
Nurrt>er Percent
5 '730
3,537
767
2,447
323
3,291
187
2,192
681
1,001
510
1,995
151
5.4
5.9
5.2
6.2
5.6
6.2
3.6
4.7
6.0
3.8
5.4
4.9
2.9
Total
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Reason for moonlighting
(percent distribution)
To rreet
regular
household
expenses
31.6
30.3
20.7
33.4
29.2
29.4
45.6
33.7
28.5
27.2
53.5
33.3
40.1
To pay To save To get
off for the experience
debts future or build up
9.3
9.0
10.4
7.6
17.0
9.1
10.6
9.7
8.7
7.8
14.8
8.9
19.7
13.0
12.9
21.5
11.0
7.2
12.8
12.8
13.1
22.1
10.6
6.0
12.9
16.3
a business
17 .o
18.1
19.5
18 .o
15.4
18.4
11.1
15.3
14.1
20.1
7.0
15.7
5.4
Other
reason
29.2
29.7
27 .9
30.1
31.1
30.3
20.0
28.2
26.6
34.2
18.8
29.2
18.4
Source: Stinson, John F., Jr., 1986, Moonlighting by women jumped to record highs, Monthly Labor Review
109(11):22-25, U.S. Department of Labor, Bureau of Labor Statistics.
Shift Work and Flexitime 1
Although the needs of society require a
diversity of work schedules, the great
majority of full-time wage and salary
workers have traditional, morning to late
afternoon hours. In contrast, almost
one-half of all part-time employees work
schedules other than regular day shifts,
and nearly one-fifth have some type of
flexible scheduling.
Nearly 8 of 10 full-time wage and salary
workers began their workdays between 7 and
9 a.m., with 8 a.m. being the most common
time. 2 Corresponding quitting times .Oetween
4 and 6 p.m. were the most frequent, with
most workers ending their workday at 5 p.m.
Traditional daytime shifts--8 to 5, 7 to 4,
8 to 4, and 9 to 5--were the most popular.
Only one of the top 10 work schedules
(the lOth-ranked 3-to-11 shift) included a
substantial number of hours outside the
normal daylight span.
Part-time jobs were far less concentrated
in terms of hours worked. Although the top
10 schedules were reported by 71% of all
full-time workers, they fit the pattern for
only 29% of the part-time workers. Of the
part-time workers, 45% reported starting
work between 7 and 9 a.m. and 38% ended
their days between 3 and 5 p.m. As was the
case for full-time workers, the most common
workday reported by part-timers was 8 to
5 p.m., but this accounted for only 4% of
the part-time schedules.
The incidence of shift work 3 and flexitime
varies by sex, race, age, and other charac­teristics,
but differences are more apparent
by occupation and industry. Shift work is a
great advantage to employers who need to
match production with demand, accommodate
1 These data were previously collected each
May in a supplement to the CPS, but annual
supplements were discontinued after 1980.
2 The times actually reported are rounded
to the nearest hour. For example, 8 a.m.
refers to any reported time between 7:30 and
8:29 a.m.
3 The term, "shift work," is used here to
describe only those schedules other than a
"regular daytime schedule."
28 Family Economics Review 1987 No.4
certain production processes, or reduce the
cost of capital per employee. Protective
service workers were most likely to work
shifts (61%), followed by workers in food
(43%) and health services (36%). Other occu­pational
groups traditionally associated with.
shift work--the operators, fabricators, and
laborers group, and salesworkers in retail
trade and personal services--had about one
in four workers on shifts. For most occu­pations,
the evening shift was the most fre­quent
deviation from the regular daytime
schedule. However, health professionals,
workers in sales occupations, protective
service workers, and motor vehicle operators
reported having rotating shifts more
frequently than evening shifts.
Of those persons who reported a reason
for not working a regular daytime schedule,
28% cited voluntary reasons, including
better arrangements for child care and care
of other family members, better pay, and
time to attend school. Most of those who
gave "involuntary" reasons cited the
schedule as a requirement of the job.
Part-time workers are three times more
likely than full-time workers to work other
than a regular daytime schedule. Employers
often hire part-time help to cover peak
hours in retail sales, entertainment, or
recreation jobs. Students frequently are
able to work only evenings or weekends.
Four-fifths of the 16- to 19-year-old group
were shift workers.
With flexitime, or flexible scheduling,
employees can vary the times their workdays
begin and end or the number of hours in a
workday, week, or pay period. Usually there
is a core time requirement, either certain
hours per day or days of the week, when
employees are required to work. Advantages
of flexitime include decreased tardiness,
added hours of service to the public,
smoothing rush hour traffic peaks, facili­tating
child care, larger blocks of employee
leisure time, and a better scheduling of the
work force to coincide with work load.
About 9.1 million full-time wage and salary
workers (12.3%) reported they were able to
vary their work schedules. Part-time workers
were more likely than full-time workers to
have flexibility in planning their work
schedules, with 3.3 million (18.6%) being
able to do so.
Among full-time workers, teenagers were
the least likely to have flexible schedules,
and persons 35 to 44 years old and 65 and
over were the most likely to have flexible
schedules. Men more than women, whites
more than blacks or Hispanics, and employees
on regular daytime shifts were those most
likely to have flexibility in their workday.
Among occupational groups, the likelihood of
flexible scheduling was highest among
mathematical and computer scientists,
natural scientists, technicians (except
health, engineering, and science), and sales
representatives (commodities, except retail).
Source: Mellor, Earl F., 1986, Shift work
and flexitime: How prevalent are they?
Monthly Labor Review 109(11):14-21, U.S.
Department of Labor, Bureau of Labor
Statistics.
Work at Home 1
More than 18 million persons reported some
type of work at home 2 in May 1985. About
770,000 of these persons were farmers or farm
laborers. Of those who worked at a nonfarm
job and reported hours worked, almost half
worked at home less than 8 hours during the
survey week.
About 9.6 million (55%) of the 17.3 million
nonfarm persons who worked at home were
men. However, women averaged more hours
per week in work at home (11.1 hours, com­pared
with 9.3 hours for men), and a larger
percentage of women than men worked 35 or
more hours per week at home (8% and 4%,
respectively).
The home-based work force differs from
the overall labor force by age and race.
1 Data on work at home were collected for
the first time in the May 1985 CPS.
2 Persons working at home on a second job
or business were not counted as home-based
workers. "Work-at-home" pertains only to
work done as part, or as an extension of the
primary job.
Nearly one in five of all nonfarm home-based
workers working 35 or more hours per week
were over 55 years of age--a group that
accounts for only one in eight of all
employed workers. Also, home-based workers
had a slightly higher percentage of white
workers than is found in the labor force as
a whole.
The largest industry group of home-based
workers who work 8 hours or more is in
services ( 4.1 million workers) and includes
professional (educational, health, and
social services such as child care),
business and repair, and personal services.
A relationship exists between hours worked
at home and involvement in the service
industry. More than one-half of the men and
two-thirds of the women with long hours
of nonfarm, home-based work were in the
service industries. Business and repair
services accounted for 97,000 of the 606,000
persons working full-time weeks at home.
These services include business management
and consulting, com'puter, and data pro­cessing
services. Social services (including
child care) accounted for 110, 000 of the
full-time, home-based workers. Other pro­fessional
services (legal, architectural,
religious organizations, and others) had
92,000 home-based workers.
The majority of persons in service indus­tries
with 8 or more hours of home-based
work per week were private wage and salary
workers, who may just be bringing work home
on a regular basis. Among those who worked
35 or more hours per week at home, however,
almost 70% were self-employed in home-based,
unincorporated businesses. Fewer than 10% of
all full-time, home-based workers were
self-employed but were incorporated.
A growing number of clerical workers may
be establishing their own businesses at
home. These workers and those in financial
records processing and bookkeeping are being
aided by the decreasing costs of personal
computers and other electronic equipment.
Home-based work offers a chance for
parents of young children to combine child
rearing with gainful employment, and working
1987 No.4 Family Economics Review 2!'
at home also eliminates commuting and child
care expenses. Nearly 600,000 married moth­ers
with children under age 6 reported some
home-based work. About 22% of these mothers
worked 35 or more hours per week at home,
comprising 29% of all nonfarm women who
worked at home full time.
In 1985, 2.2 million persons worked exclu­sively
at home. Of these, 390,000 were
working in farm occupations; and of the re­maining
1. 9 million persons, two in three
were women. Men who worked solely at home
averaged 41.1 hours of work per week,
compared with 27.7 hours for women. About
half of the persons whose work was entirely
home based were in service industries,
including professional, business and repair,
and personal services. Only about 100,000
persons with home-based work in professional
specialty occupations, including computer
programming, worked entirely at home.
During the forties, the U.S . Department of
Labor (USDL) imposed restrictions on home­work
in seven industries: Women's apparel,
jewelry, gloves and mittens, knitted outer­wear,
3 buttons and buckles, handkerchiefs,
and embroidery. Data collected in May 1985
do not allow an accurate determination of
the number of persons whose home-based
work is in these restricted industries, but it
is estimated that less that 125,000 persons
work 8 hours or more at home in these
industries.
3 Homework in the knitted outerwear indus­try
has been permitted si.nce December 1984
provided the employer obtain a certificate
from USDL. Homework in the other six indus­tries
is under consideration. See "Recent
Trends in Clothing and Textiles," by Joan C.
Courtless, Family Economics Review 87(1) :7.
Source: Horvath, Francis W., 1986, Work
at home: New findings from the Current
Population Survey, Monthly Labor Review
109: (11)31-35, U.s. Department of Labor,
Bureau of Labor Statistics.
JO Family Economics Review 1967 No.4
Housing Costs After 'Itix Reform
The new tax law that took effect in
January 1987 should bring about some modifi­cations
in Americans' expenditure patterns.
For example, the real costs of major pur­chases,
such as housing, will change. Both
the cost of renting and the after-tax cost of
owner-occupied housing will rise. Households
will need to consider these changes when
deciding (1) whether to rent or buy and
(2) how much housing to rent or buy.
Effects on Renters
As soon as market conditions allow, owners
of rental property will have to charge higher
rents to compensate for several provisions of
the new tax law that would otherwise reduce
their after-tax return. The after-tax return
to a landlord will be reduced by the
following three major changes in the tax law:
Lengthening of depreciation schedules.
Under the old law, rental property was
depreciated over 19 years; under the new
law the period is 27-1/2 years. Also, yearly
depreciation will be constant over the period
rather than concentrated in the beginning of
a property's depreciable life. Since these
changes will allow landlords to claim less
depreciation in the early years of their
rental investment, their total after-tax
return will be lower.
Reduction in marginal income tax rates.
When it becomes fully effective in 1988,
the 14 tax brackets under the old law will
be replaced by three new brackets--15%, 28%,
and 33%. The value of an investment as a tax
write-off depends on the taxpayer's marginal
rate, the highest tax bracket in which he
pays taxes. When an investment generates a
negative return for tax purposes, lower tax
rates reduce the value of that investment as
a tax write-off. For a taxpayer who was pre­viously
in the 42% tax bracket, every dollar
subtracted from his taxable income was worth
42 cents in tax savings. Under the new tax
law if the taxpayer is in the 28% tax bracket,
every dollar subtracted is worth only
28 cents in tax savings.
Increase in capital gains taxes. In
periods of rising property values, much of
the return of rental housing is in the form
of capital gains. Under the old tax law, only
40% of long-term capital gains were included
in taxable income. At the highest tax bracket,
this resulted in a maximum tax rate on total
capital gains of 20%. Under the new tax law
the partial exclusion of capital gains has
been eliminated. Capital gains income will be
taxed at the same rate as all other income.
Therefore, for some taxpayers the capital
gains tax rate will be as much as 33%.
It is estimated that landlords will have to
raise rents between 16% and 27% in order to
achieve the same after-tax rate of return
under the new tax law. However, these rent
increases will not occur overnight. Before
landlords will be able to impose rent increases,
construction of rental units will have to
slow and vacancy rates will have to fall.
Effects on Homeowners
The major homeowner tax deductions-­mortgage
interest and property taxes--will
be retained under the new tax law. However,
other changes will result in higher after-tax
housing costs for homeowners.
Since all taxpayers can claim the standard
deduction, only the itemized deductions over
and above the level of the standard deduc­tion
result in a decrease in taxes. Under
the new tax law the standard deduction for
a married couple filing jointly will increase
from $3,670 in 1986 to $5,000 in 1988.
Because a number of nonhousing deductions
have been eliminated, homeowners will have
to use some of their housing deductions to
bring their itemized deductions up to the
higher level of the standard deduction.
Therefore, that used portion of their hous­ing
deduction will not help in decreasing
their total tax bill.
Homeowner costs will also increase because
lower marginal tax rates will lower the
value of housing deductions. Homeowners are
affected by lower tax rates just as land­lords
are. Tax savings from housing deduc­tions
will drop for those who fall into a
lower tax bracket under the new law.
Interest rates are a key factor in deter­mining
the cost of owner-occupied housing,
because lower interest rates result in lower
monthly mortgage payments. Some forecasters
suggest that the new tax law will lead to a
decline in long-term interest rates; this
could help offset the increases in the costs
of homeownership brought about by the new
tax law.
Many families question whether to rent or
buy housing. The answer depends on the
family's after-tax rate of return on owner­occupied
housing compared to the next best
investment opportunity. For example, at a 5%
inflation rate, a four-person family earning
$40,000 or more a year (in 1988 dollars) and
intending to live in the home for at least
10 years, would realize a tax savings in
buying their home. However, a family with
less income, or one who plans to move before
10 years have passed, should fare better by
renting their home and investing in long­term
Treasury securities or tax-exempt
municipals as an alternative.
The cost of housing will rise for everyone
under the new tax law. Because changes in
the tax law will adversely affect landlords
more than homeowners, the homeownership
rate should rise as a result of tax reform.
The new tax law makes homeownership prefer­able
for more familie·s than the old law, but
the longer homeowners intend to stay in
their home, the more advantageous the new
law becomes.
Source: Crone, Theodore, 1987, Housing
costs after tax reform, Business Review,
March/ April issue, pp. 3-12, Federal Reserve
Bank of Philadelphia.
The Effect of Interest Rate
Ceilings on Credit Card Loans
In 1983, 62% of American families charged
purchases on some type of credit card. More
than half of all families reported using
retail store cards; 40% reported using at
least one bank card, and 26% at least one
gasoline card. Credit card use rises with
family income and the educational level of
the family head. Retail store cards are used
more widely than bank cards except among
families with incomes of at least $50,000
or those headed by persons with a college
education. Recently, however, use of bank
cards has been expanding rapidly in every
family category of income, age, education,
and occupation.
1987 No.4 Family Economics Review 31
The payment pattern of the credit card
holder determines whether interest is
charged to the account. Convenience users
pay off the balance in full before the grace
period ends; borrowers usually do not and
thereby incur finance charges. About one­half
of the families who use credit cards do
so for convenience. The others are about
evenly divided between those who sometimes
pay their bills in full and those who rarely
pay the outstanding balance in any one
month.
Since the early eighties, interest rates
on consumer loans have fallen substantially
but rates on credit cards have chang.ed
little. As a result, in 1986 several bills were
considered in Congress that would have
imposed a national ceiling on credit card
interest rates. The possible responses by
banks and retailers to such ceilings and the
subsequent effects on borrowers and other
purchasers are described here.
Before 1984, profits made from bank credit
plans were relatively low compared to pro­fits
made by other types of bank loans. High
profits earned by bank cards in 1984 and
1985 cannot be expected to continue, since
they were the result of favorable economic
trends and structural changes in credit card
regulations made during that time.
Even though annual data on earnings of
retail credit card plans are not available,
the results of two national surveys of re­tailers
indicate that, on average, their credit
card plans consistently operated at a loss.
Because profits on credit card plans have
been low for banks and negative for retailers,
it is unlikely that card issuers could absorb
significant reductions in revenue from lower
finance charges. Therefore, some changes to
offset their losses would be necessary.
Studies suggest that lenders are more
lenient in extending credit when a higher
interest rate is allowed. If credit card
interest rates were lowered, lenders could
reduce collection costs by tightening credit
standards. Given the criteria that issuers
use for determining creditworthiness, in­creased
restriction would affect new credit
card applicants with low levels of income,
32 Family Economics Review 1987 No.4
education, and skills; applicants that are
recent entrants into the job market; and
those families headed by young persons.
Another cost-cutting option open to lend­ers
would curtail special features, such as
programs that protect against charges made
on lost or stolen cards, discounts on trans­portation
and lodging, rebates on purchases
billed to credit card accounts, and emer­gency
cash loans. Also, banks and retailers
might establish or increase fees for proces­sing
credit card applications, replacing lost
cards, providing additional cards for an
account, and issuing monthly statements. If
profit loss became severe, some issuers
might even eliminate their credit card plans
altogether and redirect resources into more
profitable areas.
An alternative or complementary way for
lenders to offset reduced income would be
by repricing credit card services. Also,
the grace period (before finance charges are
added) could be shortened or eliminated.
Consumers who make full payment to avoid
incurring finance charges would be most
adversely affected by such cutbacks. Bank
lenders could also increase the merchant
discount--the fee they charge merchants for
processing credit card sales. This increase,
in turn, could cause retailers to raise their
merchandise prices. Price increases would
affect all consumers, including those who
always pay in cash. Adjustments in pricing
and credit availability, however, would be
subject to important constraints, including
competition from other credit card issuers
and State regulations that limit pricing
changes.
Source: Canner, Glenn B. , and James T •
Fergus, 1987, The economic effects of pro­posed
ceilings on credit card interest rates,
Federal Reserve Bulletin 73(1):1-13, Board
of Governors of the Federal Reserve System.
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Cost of food at home estimated for food plans at 4 cost levels, July 1987, U.S. average 1
Cost for 1 week Cos t for 1 mon th
Sex-age group
Thrifty Low-cost Moderate- Liberal Thrifty Low-cost Moderate- Liberal
plan plan cost plan plan plan plan cost plan plan
FAMILIES
Family of 2: 2
20 - 50 years • •• •• •••• ••••• • • •• •••• . • $39.90 $50.50 $62.50 $77.60 $173 . 40 $218.60 $270.50 $335.70
51 years and over • ••••• • ••••••••• • • 38 . 10 48 . 40 59.80 71.70 164.70 210 . 00 259.30 310 . 60
Family of 4:
Couple, 20-50 years and children--
1-2 and 3-5 years . •• • ••••••.••••• 58.10 72.50 88.80 109.10 252 . 10 314.10 384.60 472.30
6-8 and 9-11 years ............... 66.70 85.30 107.00 128.80 289.20 369.40 463.30 558 . 10
INDIVIDUALS 3
Child:
1-2 years . •••• •. •• . •• • •• • •.•••••••• 10.50 12.70 14.80 17.90 45.40 55.00 64.10 77.40
3-5 years • ••••••••. •. •• . ••••• • ••••• 11.30 13.90 17.20 20.70 49.10 60.40 74 . 60 89.70
6-8 years •••• • ••• . •• . • . •••••• • •• • •• 13.90 18.40 23.20 27.00 60.20 79.90 100.30 117.10
9-11 years ...... .. ...... .. ......... 16.50 21.00 27.00 31.30 71.40 90.80 117.10 135 . 80
Male:
12-14 years ........................ 17.20 23.80 29.80 34.90 74.50 103.10 128.90 151.40
15-19 years •••••••••••••••••••••••• 17.90 24.70 30.70 35.50 77.50 106.90 132.80 154.00
20-50 years •••••••••••••••••••••••• 19.10 24.40 30.70 37 .10 82.90 105 . 70 132.90 160.50
51 years and over •••••••••• . •.••••• 17.50 23.20 28.60 34.40 75.60 100.70 124.00 148.80
Female:
12-19 years ........................ 17.20 20.60 25.00 30.30 74.50 89.10 108.30 131.10
20-50 years ••••••• . ••••••.•••••• • • • 17.20 21.50 26.10 33.40 74.70 93.00 113.00 144.70
51 years and over • ••••••.•.••••••• 17.10 20.80 25.80 30.~0 74.10 90.20 111.70 133.60
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(1). Estimates for the other plans were
computed from quantities of foods published in Family Economics Review, 1983(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.
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Heterogeneity Among Persons
65 Years and Older1
Illuminating data concerning the growing
elderly population are available from the
1984 Consumer Expenditure Survey (CES).
New estimates provide for the reporting of
two separate classes of consumer units 2
with reference persons 3 65 to 74 years and
75 years and older. Although persons 65
years and older have been viewed as a homo­geneous
group, the CES reveals that the
65-to-74 and the 75-and-over age groups
have different characteristics, incomes, and
expenditures (table).
Expenditure differences. In 1984 major
differences between the two groups occurred
in expenditures for housing, transportation,
and health care. Although housing demanded
a larger share of the older group's total
annual expenditures, consumer units in the
65-to-7 4 age group spent 22% more on housing
than those in the 7 5-and-over age group.
Persons age 65 to 74 have a higher level of
home ownership and are more likely to be
making mortgage payments than the older
group (33%, compared with 8%). The 65-to-74
age group also spent 33% more on property
taxes than the older group, reflecting the
higher rate of home ownership among the
younger group. Higher tax expenditures also
suggest that those age 65 to 74 own more ex­pensive
houses, or live in areas with higher
1 Findings from the Consumer Expenditure
Survey: Interview Survey, 1984, U.S.
Department of Labor, Bureau of Labor Statis­tics.
For additional information on this
survey and its two component parts, see
"Spending Patterns of U.S. Households,"
Family Economics Review 1987 (1): 26-28.
2 The basic reporting unit for the CES is
the consumer unit that refers to a single
person or group of persons in a sample
household related by blood, marriage, adop­tion,
or other legal arrangement, or who
share responsibility for at least 2 of 3 major
types of expenses--food, housing, and other
expenses.
3 The reference person or householder is
the first person named by the respondent as
owning or renting the home.
34 family Economics Review 1987 No.4
property taxes, or both. The expenditure
share for fuels, utilities, and public services
was higher for the 75-and-over age group,
even though the amount spent was 25% less
than that spent by those age 65 to 74.
Transportation accounted for a greater
share of total expenditures for those 65 to
74 years of age than for those 75 years and
older. Also, the younger group spent twice
as much on transportation as the older con­sumers.
These differences can be attributed
to the higher level of vehicle ownership
among the younger class (81%) compared with
the older class (59%). Moreover, it is likely
that vehicles are used less frequently by
the older group, which further reduces their
transportation expenditures.
Both mean expenditures for health care
and the health care share of total expen­ditures
were higher for the 75-and-over age
group than for their younger counterparts.
Income differences. Since income is one
of the important determinants of spending,
differences in income may help to explain
the variations in expenditure patterns. In
1984 mean income before taxes for the
65-to-74 age group was more than one-third
higher than that for the older consumer
units. The largest component of income for
both groups was retirement income (Social
Security, and private and government pen­sions),
accounting for 53% and 63% of the
younger and older groups' income. Wages and
salaries constituted about 30% of the younger
group's income but less than 10% of the older
group's, which indicates household members
in consumer units with younger reference per­sons
are more likely to be working. Average
number of earners in the consumer unit was
three times higher for the younger group.
Source: Harrison, Beth, 1986, Spending
patterns of older persons revealed in expen­diture
survey, Monthly Labor Review
109(10): 15-17, U.S. Department of Labor,
Bureau of Labor Statistics.
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Characteristics and annual expenditures of consumer units with elderly reference persons 1 and of all consumer units 2
All
consumer
units
Age of reference person All Age of reference person
I tern
65-74
years
75 years
and over
Item
-------------------------------- --------
Total consumer units (thousands) •••
Consumer unit characteristics:
Income before taxes 3
•••••••••••••
Average number of persons •••••••
Average age of reference person •
Average number in consumer unit:
Earners ••••••••••••••••••••••••
Vehicles •••••••••••.. •••••••••••
Children under 18 ••••••••••...•
Persons 65 and over ••••••••••••
Percent homeowners .•••••••••••••
Average annual expenditures •••••••
Food •••••.•••••••••••••••••••••••
Alcoholic beverages •••.••••••••••
Housing ••••••••.•••••••••••••••••
Shelter ••••••••••••••••••••••••
Owned dwellings ••••••••••••••
Rented dwellings •••••••••••••
Other lodging ••••••••••••••••
Utilities, fuels, and public
services •••••••••••••••••• • • · • •
Household operations ••••••• · • • •
Housefurnishings and equipment
Apparel and services •••••••••••• ·
Transportation •••••••••.••• • • • • • •
Vehicles .••••••••••••• • • • • • • • • • •
Gasoline and motor oil ••••••••••
74,884
$24.578
2.6
46.2
1.4
1.9
.7
.3
60.0
$21,788
3,391
299
6,626
3. 747
2,188
1,171
388
1,679
333
868
1,192
4,385
1,873
1,047
8,312
$16,815
1.9
69.3
.6
1.4
.1
1.4
76.0
$15,873
2,831
179
4,848
2,386
1,378
632
377
1,644
269
549
715
3,041
1,175
764
5,608
$12,442
1.5
80.6
.2
.8
.o
1.4
67.0
$11,196
1,912
90
3,972
2,014
1,009
884
122
1, 311
356
291
346
1,450
385
354
T ransportation--cont:
Other vehicle expenses ••••••••••
Public transportation ••••••••••••
Health care .••.•••••.••....••.••••
Entertainment •••••••••••.•••.•••••
Personal care .••••••••••••••••••• ••
Reading .••••••••••••••••••.•••••• •
Education •••••••••••• · • • • • • • • • • • · •
Tobacco •••••••••••• ••· • · • • • • • • • • • •
Miscellaneous ••••••••••••••. • • •• • • •
Cash contributions .••••.••••••••••
Personal insurances and pensions .•
Life and other personal
insurance •••••••••••••••• • • • • • •
Retirement, pensions, Social
Security ••••••.••••••••••• • • • • •
Shares of total expenditures
(percent):
Total. ••••••••••••..••••••.••••••••
Food at home ••••••••••••••••••••
Food away from home ••••••••••••
Housing ••.••••••• •••••••• • • • • • • •
Transportation •••••.••.•••••••••
Health care ••••••••••••••••••••••
Entertainment and reading .••••••
Personal insurance and pensions.
Apparel and services .•••••••••••
Other ••••••••••.•. •••••••••• ••••
cons \.Iller
units
$1,176
288
899
1,040
205
140
312
225
311
740
2,023
302
1, 721
100.0
10.7
4.8
30.4
20.1
4.1
5.4
9.3
5.5
9.6
65-74
years
$800
302
1,340
604
211
130
88
173
172
762
778
220
558
100.0
13.0
4.8
30.5
19.2
8.4
4.6
4.9
4.5
10.1
75 years
and over
$473
238
1,487
291
148
93
101
65
135
878
229
86
142
100.0
13.6
3.5
35.5
13.0
13.3
3.4
2.1
3.1
12.5
----- -----------
1 The reference person or householder is the first person named by the respondent as owning or renting the home •
2 Data from the Consumer Expenditure Survey (CES), Interview Survey, 1984. The basic reporting unit for the CES is the consumer
refers to a single person or group of persons in a sample household related by blood, marriage, adoption, or other legal arrangement,
responsibility for at least 2 of 3 major types of expenses--food, housing, and other expenses.
3 Income values are derived from the responses of only those units providing complete reports of income •
unit that
or who share
Source: Harrison, Beth, 1986, Spending patterns of older persons revealed in expenditure survey, Monthly Labor Review 109(10): 15-17, U.S .
Department of Labor, Bureau of Labor Statistics.
Updated Estimates of the Cost of Raising a Child
The cost of raising urban children: June 1987; moderate cost level 1
Region and
age of child
(years)
MIDWEST: 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
$4,697
4,837
4,505
4,774
5,006
5,202
5,398
5,755
5,896
6,462
95,867
4,660
4,828
4,703
4,972
5,367
5,563
5,816
6,160
6,328
6,776
101,222
5,117
5,257
4,931
5,172
5,513
5,681
5,905
6,285
6,454
6,919
104,431
5,043
5,211
4,948
5,249
5,662
5,858
6,110
6,435
6,576
7,210
106,687
Food
at
hare 2
$616
756
756
868
840
1,036
1,232
1,260
1,401
1,569
19,633
728
896
868
980
980
1,176
1,429
1,429
1, 597
1,765
22,436
672
812
784
868
868
1,036
1,260
1,260
1,429
1,569
19,969
672
840
812
924
896
1,092
1,344
1,344
1,485
1,681
21,005
Food
away
frcm
heme
$0
0
0
157
157
157
157
189
189
189
2,390
0
0
0
157
189
189
189
189
189
220
2,644
0
0
0
157
189
189
189
220
220
220
2,768
0
0
189
220
220
220
220
220
252
3,082
Clothing
$147
147
239
239
330
330
330
477
477
661
6,460
147
147
257
257
349
349
349
514
514
642
6,756
165
165
257
257
349
349
349
514
514
661
6,830
147
147
239
239
349
349
349
495
495
624
6,572
Housing 3 Medical
care
$2.018
2,018
1,773
1,773
1,681
1,681
1,681
1,742
1,742
1 ,804
31,790
2,048
2,048
1,865
1,865
1,834
1,834
1,834
1,895
1,895
1,926
33,992
2,170
2,170
1,926
1,926
1,834
1,834
1,834
1,895
1,895
1,956
34,540
2,109
2,109
1,895
1,895
1,865
1,865
1,865
1,926
1,926
2,018
34.728
$343
343
343
343
343
343
343
343
343
343
6,174
343
343
343
343
343
343
343
343
343
343
6,174
381
381
381
381
381
381
381
381
381
381
6,858
419
419
419
419
419
419
419
419
419
419
7,542
Educa­tion
$0
0
0
0
161
161
161
161
161
161
1,932
0
0
0
0
202
202
202
202
202
202
2,424
0
0
0
0
242
242
242
242
242
242
2,904
0
0
0
0
202
202
202
202
202
202
2,424
Transpor­tation
$875
875
762
762
762
762
762
818
818
903
14,448
762
762
705
705
705
705
705
790
790
846
13,426
931
931
818
818
818
818
818
875
875
959
15,460
931
931
818
818
846
846
846
931
931
1,016
15,966
All
other 4
$698
698
632
632
732
732
732
765
765
832
13,040
632
632
665
665
765
765
765
798
798
832
13,370
798
798
765
765
832
832
832
898
898
931
15,102
765
765
765
765
865
865
865
898
898
998
15,368
1Annual 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.
! Includes shelter, fuel, utilities, household operations, furnishings, and equipment .
~Includes personal care, recreation, reading, and other miscellaneous expenditures.
5 Formerly the North Central region.
36 Family Economics Review 1987 No.4
The cost of raising rural nonfarm children : June 1987; moderate-cost level'
Region and
age of child
(years)
MlDWEST: 5
Total
Food
at
heme 2
Food
away
fran
heme
Clothing Housing 3 Medical
care
Educa­tion
Transpor- All
tat ion other •
Under 1 •• ••• •••• $4,435 $560 $0 $128 $1,926 $343 $0 $846 $632
1 •••••••••••••••• 4,575 700 0 128 1,926 343 0 846 632
2-3 •••••••••••••• 4,069 672 0 202 1,620 305 0 705 565
4-5 •• • ••• • ••••••• 4,307 784 126 202 1,620 305 0 705 565
6 •••••••••••••••• 4,674 784 157 312 1, 590 305 161 733 632
7-9 •••••••••••••• 4,842 952 157 312 1,590 305 161 733 632
10-11 •• •• •••••• •• 5,066 1,176 157 312 1,590 305 161 733 632
12 •••••••••• • •••• 5,443 1,176 157 477 1,651 305 161 818 698
13-15 ••••••••••• • 5,583 1,316 157 477 1,651 305 161 818 698
16-17 .. .. .. .. .. .. --:-5'-'''-"9-=-9"-6 __ __,1'-'-,_,_45"'7'------"'18::,:9:.._ _~ 58::.;7:.._ _: ,1....:,6 :!!:8~1_ _- --'3~4~3"-------'1~6~1 ___~ 84!.!6!__ ____!.7.:!.32~-
Total • • • ••••••• 89,278 18,202 2,200 6,018 29,838 5,642 1,932 13,874 11,572
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 ........ ..
5,314
5,426
4,922
5 , 223
5,466
5 , 634
5,858
6,284
6,424
6,965
104,600
5,151
5,291
5,054
5,355
5,774
5,942
6,194
6,561
6, 730
7 , 308
108,615
5,532
5,672
5,123
5,424
5,874
6,070
6,294
6,721
6,890
7,539
111,439
672
784
756
868
840
1.008
1,232
1,232
1, 372
1,541
19,462
672
812
784
896
896
1,064
1,316
1,316
1,485
1, 653
20,641
672
812
784
896
868
1,064
1, 288
1, 288
1,457
1,653
20,445
0
0
0
189
189
189
189
220
220
252
2,896
0
0
0
189
220
220
220
220
220
252
3,082
0
0
0
189
189
189
189
220
220
252
2,896
165
165
257
257
349
349
349
532
532
752
7,084
147
147
239
239
349
349
349
532
532
697
6,866
147
147
239
239
367
367
367
551
551
642
6,940
2,170
2,170
1,865
1,865
1,804
1,804
1,804
1,865
1,865
1,895
33,874
2,170
2,170
1,987
1,987
1,956
1,956
1,956
2,018
2,018
2,079
36,254
2,201
2,201
1,895
1,895
1,865
1,865
1,865
1,926
1,926
2,048
34,972
381
381
381
381
381
381
381
381
381
381
6,858
343
343
343
343
343
343
343
343
343
343
6,174
419
419
381
381
419
419
419
419
419
419
7,390
0
0
0
0
202
202
202
202
202
202
2, 424
0
0
0
0
242
242
242
242
242
242
2,904
0
0
0
0
242
242
242
242
242
242
2,904
1,128
1,128
931
931
903
903
903
987
987
1,044
17,434
987
987
903
903
903
903
903
959
959
1,044
16.928
1,128
1,128
959
959
959
959
959
1,044
1,044
1, 185
18.392
798
798
732
732
798
798
798
865
865
898
14,568
832
832
798
798
865
865
865
931
931
998
15,766
965
965
865
865
965
965
965
1,031
1,031
1,098
17.500
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
Es timates 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 per sonal care, recreation, reading, and other miscellaneous expenditures .
5 Formerly the North Central region.
1987No.4 Family Economics Review 37
Consumer Prices
Consumer Price Index for all urban consumers [ 1967
Group
All i terns •••••.•••.••••••••••••••••••••••••••
Food ......•..•.... · · · • · · · • · · · · • · • · • · • • • • • •
Food at home ••••••••••••••••••••••••••••
Food away from home ••••••••••••••••.•••
Housing ....................... · · · · · · · · · · · ·
Shelter ................................. .
Renters' costs 1
••••••••••••••••••••••••
Rent, residential •••••••••••• ~ •••••••
Homeowners' costs 1
••••••••••••••••••••
Maintenance and repairs •••••••••••••••
Maintenance and repair services •••••
Maintenance and repair commodities ••
Fuel and other utilities •••••••••••••••••
Fuel oil and other household fuel
com modi ties .••••••••••••••••••••••••••
Gas (piped) and electricity ••••••••••••
Household furnishings and operation •••••
Housefurnishings ••••••••••••••••••••••
Housekeeping supplies •••••••••••••••••
Housekeeping services •••••••••••••••••
Apparel and upkeep ...................... .
Apparel commodities .••••••••••••••••••••
Men's and boys' apparel •••••••••••••••
Women's and girls' apparel ••••••••••••
Infants' and toddlers' apparel •••••••••
Footwear ••••••••••••••••••••••••• • • • • •
Apparel services ••••••••••••••••••••••••
Transportation ••••••••••••••••••••••••••••
Private transportation •••••••••••••••••••
New vehicles ••••••••••••••••••••••••••
Used cars ............................ .
Motor fuel •••••••••••••••••••••••••••••••
Maintenance and repair ••••••••••••••••••
Pubiic transportation ••••••••••••••••••••
Medical care •••••••••••••••••••••••••••••••
Medical care commodities •••••••••••••••••
Medical care services ••••••••••••••••••••
Professional services ••••••••••••••••••
Entertainment •••••••••••••••••••••••••••••
Other goods and services ••••••••••••••••••
Personal care . .......................... .
Personal and educational expenses •••••••
1 Indexes based on December 1982 = 100 base.
July
1987
340.8
333.6
319.1
374.9
372.5
422.1
129.3
291.2
124.4
392.4
452.8
281.9
388.1
2 497.9
454.8
255.1
203.9
330.1
353.8
210.5
194.0
203.0
168.3
301.2
214.3
348.7
318.5
310.5
231.8
385.5
311.2
376.8
438.3
464.1
293.4
501.5
418.9
283.5
365.1
300.2
456.5
100, unless otherwise noted]
Unadjusted indexes
June
1987
340.1
334.1
320.4
373.8
371.3
420.2
127.9
289.6
124.2
385.0
440.5
280.2
387.6
2 498.6
456.8
254.9
203.6
330.5
353.0
214.5
198.1
205.3
173.7
308.0
218.8
347.4
316.7
308.6
231.2
383.0
306.0
376.3
438.1
461.3
291.5
498.4
416.7
282.3
362.9
299.2
455.5
May
1987
338.7
332.5