Monday, December 27, 2010

A History of U.S. Consumer Finance

Source: Harvard Business School

A Brief Postwar History of US Consumer Finance 

by Andrea Ryan, Gunnar Trumbull and Peter Tufano

This article describes the consumer finance sector in the US since World War II.   We first define the sector in terms of the functions delivered by firms (payments, savings/investing, borrowing, managing risk, and providing advice.)  We provide time series evidence on major trends in consumption, savings, and borrowing.  Examining consumer decisions, changes in regulation, and business practices, we identify four major themes that characterize the sector: (a) innovation that increased the choices available to consumer; (b) enhanced access in the form of broadening participation of consumers in financial activities, (c) do-it-yourself consumer finance, which allowed and forced consumers to take greater responsibility for their own financial lives, and (d) the resultant increase in household risk taking

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Tuesday, December 21, 2010

Only 39 Percent Complete Undergraduate Degree in 4 Years

Source: National Center for Education Statistics

Tracking Students to 200 Percent of Normal Time: Effect on Institutional Graduation Rates

A majority of college graduates take longer to earn a degree than what is commonly thought to be the “normal” amount of time it should take—4 years for a bachelor’s degree and 2 years for an associate’s degree. For example, among college graduates who earned a bachelor’s degree in 1999–2000, about two-fifths (39 percent) had completed the degree in 4 years (Bradburn et al. 2003). A majority (72 percent) of this cohort, however, had completed a bachelor’s degree within 6 years, while 14 percent took 6–10 years and the remaining 14 percent took more than 10 years. Similarly, among a survey of students who started college in 1995–96 with the goal of completing an associate’s degree, less than one-fifth (17 percent) completed the degree in 2 years, 43 percent took 2–3 years, and another 40 percent took 3–6 years.

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Health Care Expenditures by Gender and Age

Source:  Health Affairs

Pronounced Gender And Age Differences Are Evident In Personal Health Care Spending Per Person

This paper examines differences in national health care spending by gender and age. Our research found significant variations in per person spending by gender across age groups, health services, and types of payers. For example, in 2004 per capita health care spending for females was 32 percent more than for males. Per capita differences were most pronounced among the working-age population, largely because of spending for maternity care. Except for children, total spending for and by females was greater than that for and by males, for most services and payers. The gender difference in total spending was most pronounced in the elderly, as a result of the longer life expectancy of women.

US Personal Health Care Spending, By Gender, Age, And Service, 2004

Service/age group (years) Total spending (billions of dollars) Per capita spending (dollars)
Females Males Females Males
All personal health care $887.9 $662.0 $ 5,989 $ 4,541
0–18 99.5 108.8 2,620 2,736
19–64 464.9 345.5 5,202 3,797
65+ 323.4 207.7 15,493 13,809

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How Much Can Baby Boomers Expect to Inherit

Source: MetLife Mature Market Institute

Inheritance and Wealth Transfer to Baby Boomers
The figures, drawn from national survey data, say the wealthiest Boomers will be given an average of $1.5 million, while those at the other end of the spectrum will be left $27,000, an amount that represents a larger percentage of the latter group’s overall wealth.  Two-thirds of all Boomers stand to receive some inheritance over their lifetimes.

Inheritance and Wealth Transfer

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The Price of College

Source:  National Center for Education Statistics

What Is the Price of College? Total, Net, and Out-of-Pocket Prices in 2007–08

Source:  National Center for Education Statistics

This Statistics in Brief describes the annual price of education among undergraduates enrolled in U.S. postsecondary institutions in 2007–08. The most recent administration of the National Postsecondary Student Aid Study (NPSAS) supplied the data.


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Monday, December 20, 2010

Recent Likelihood of Identity Theft 1 in 20

Source:  Bureau of Justice Statistics

Victims of Identity Theft, 2008

Presents findings from the 2008 Identity Theft Supplement (ITS) to the National Crime Victimization Survey (NCVS). The NCVS/ITS used interviews from a nationally representative sample of about 56,500 U.S. household residents to collect the first BJS data on individual victims of identity theft. Identity theft is defined as the unauthorized use or attempted use of existing accounts, the unauthorized use or attempted use of personal information to open a new account, and the misuse or attempted use of personal information for a fraudulent purpose. The report details the number and percentage of persons who reported at least one incident of identity theft over the past two years, the amount of direct and indirect financial loss due to identity theft, victim reporting to credit bureaus and law enforcement agencies, and the impact of identity theft on victims' lives.

Highlights include the following:

  • An estimated 11.7 million persons, representing 5% of all persons age 16 or older in the United States, experienced at least one type of identity theft in a 2-year period.
  • Although the total financial cost of identity theft was nearly $17.3 billion over a 2-year period, less than a quarter (23%) of identity theft victims suffered an out-of-pocket financial loss from the victimization.
  • About 42% of victims spent 1 day or less working to resolve the financial and credit problems associated with the identity theft; however, 3% continued to experience problems related to the theft more than 6 months after discovering it.

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Monday, December 13, 2010

Expected Inflation Risk Premium

Source: Federal Reserve Bank of Cleveland

News Release: November 17, 2010

The Federal Reserve Bank of Cleveland reports that its latest estimate of 10-year expected inflation is 1.50 percent. In other words, the public currently expects the inflation rate to be less than 2 percent on average over the next decade.

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Wednesday, December 8, 2010

IRS Announces 2011 Standard Mileage Rates

Source: IRS

IR-2010-119, Dec. 3, 2010

WASHINGTON — The Internal Revenue Service today issued the 2011 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2011, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 51 cents per mile for business miles driven
  • 19 cents per mile driven for medical or moving purposes
  • 14 cents per mile driven in service of charitable organizations

The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs as determined by the same study. Independent contractor Runzheimer International conducted the study.

A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle. In addition, the business standard mileage rate cannot be used for any vehicle used for hire or for more than four vehicles used simultaneously.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Revenue Procedure 2010-51 contains additional details regarding the standard mileage rates.

Tuesday, December 7, 2010

Where Does All The Time Go?

Source: Alfred P. Sloan Foundation/Focus on Workplace Flexibility

Family Change and Time Allocation in American Families

Suzanne M. Bianchi, UCLA
In this paper, I briefly discuss family demographic changes. Then I use the American Time Use Survey (ATUS) and the historical time diary studies in the U.S. to document trends in parents’ time spent in paid work, housework and childcare. I also describe the activities parents forego in order to meet work and family demands. Finally, I discuss time devoted to adult care and help given to adult children, elderly parents, and friends later in the life course.

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Finding Day Care Services

Source: MetLife

The Essentials: Adult Day Services

Coping with a chronic illness or disability that impacts one’s independence, ability to manage daily activities, and opportunity to socialize with others can be overwhelming for an individual. Chronic illness and disability also significantly impact the family members that provide support and care to him or her. Family caregivers are often juggling caregiving with the many other demands in their lives, often both at home and at work.

Finding care resources to meet your needs or those of a loved one is not always easy and it can be very costly both at home, depending upon the level of care needed, or in a residential care setting such as an assisted living community or a nursing home. Most people want to remain at home if possible. One option to consider is Adult Day Services (ADS). These centers have two primary missions: 1) to provide individuals with needed care, socialization, and supervision in a community setting and 2) to provide caregivers respite from the demanding responsibilities of caregiving.

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PEW Report on Student Borrowing

Source: PEW Research Center

The Rise of College Student Borrowing

By Rebecca Hinze-Pifer and Richard Fry

Undergraduate college student borrowing has risen dramatically in recent years. Graduates who received a bachelor’s degree in 20081 borrowed 50% more (in inflation-adjusted dollars) than their counterparts who graduated in 1996, while graduates who earned an associate’s degree or undergraduate certificate in 2008 borrowed more than twice what their counterparts in 1996 had borrowed, according to a new analysis of National Center for Education Statistics data by the Pew Research Center’s Social & Demographic Trends project.

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