Thursday, April 18, 2019

Reaching Out for Financial Advice in Old Age

Older Americans might be in trouble. They control a large share of the nation's wealth, yet many are not prepared to manage it. Cognitive abilities decline with age, and most older Americans eschew financial advice. Those are some of the findings of a National Bureau of Economic Research analysis of the 2016 Health and Retirement Study, a longitudinal survey of people aged 50 or older. NBER researchers added several questions about financial advice to the HRS, which also measures cognitive ability and financial literacy. The goal of the study was to determine how cognitive ability and financial literacy influence the quantity and quality of the financial advice sought by older Americans.

One of the study's major findings is how infrequently older Americans seek financial advice. Only 35 percent of respondents had reached out for guidance on handling their finances. Another major finding of the study: seeking financial advice is not influenced by cognitive ability or financial literacy. In other words, cognitive ability and financial literacy have no affect on the quantity of financial advice sought by older Americans.

The quality of financial advice is another matter. "More cognitively able and financially literate respondents tend to seek professional financial advice, rather than seeking casual help from family/friends," the authors report. Respondents with greater cognitive ability and financial literacy are more distrustful of financial advisors in general and especially wary of "free" financial advice from advisors who shroud their fees. The quality of financial advice is influenced by cognitive ability and financial literacy, the researchers conclude.

"Low cognitive ability and poor financial literacy can be a barrier to receiving quality financial advice," conclude the authors, "suggesting that researchers and policymakers may need to find new ways to evaluate and monitor financial behavior in an aging population."

Source: National Bureau of Economic Research, How Cognitive Ability and Financial Literacy Shape the Demand for Financial Advice at Older Ages, Working Paper 25750 ($5.00)

Wednesday, April 17, 2019

Most Americans Have Three or More Siblings

How many brothers and sisters do Americans aged 18 or older have? The 2018 General Social Survey asks about siblings with the question, "How many brothers and sisters did you have? Please count those born alive but no longer living, as well as those alive now. Also include stepbrothers and stepsisters, and children adopted by your parents."

Number of siblings
None: 4%
One: 21%
Two: 21%
Three: 16%
Four: 10%
Five: 7%
Six: 6%
Seven: 5%
Eight: 3%
Nine: 2%
Ten or more: 4%

Among all Americans aged 18 or older, the 54 percent majority have (or had) three or more siblings. But there are differences by age. Among adults aged 50 or older, fully 61 percent have (or had) three or more siblings. Among adults under age 50, a smaller 49 percent have (or had) three or more siblings.

Source: Demo Memo analysis of the 2018 General Social Survey

Tuesday, April 16, 2019

How Many Participate in Sports or Exercise on an Average Day?

Nearly one in five Americans aged 15 or older (19 percent) participates in sports, exercise, or recreation on an average day, according to the American Time Use Survey. Of the many sports and recreational activities in which people participate, fewer than two dozen attract at least 1 million enthusiasts on an average day. Here they are...

Number (and %) of people aged 15-plus participating in sport/exercise on average day, 2017
1. Walking: 16.6 million (6.4%)
2. Working out (unspecified): 9.0 million (3.5%)
3. Weightlifting/strength training: 7.9 million (3.1%)
4. Running: 4.9 million (1.9%)
5. Swimming/water sports: 4.2 million (1.6%)
6. Biking: 2.6 million (1.0%)
7. Doing yoga: 1.9 million (0.7%)
8. Using cardiovascular equipment: 1.8 million (0.7%)
9. Playing basketball: 1.6 million (0.6%)
10. Playing soccer: 1.1 million (0.4%)
11. Golfing: 1.0 million (0.4%)

These figures do not include all those who bicycle or walk to work, which is logged as travel related to work rather than sports or exercise. In 2017, about 800,000 people usually bicycled to work and 4 million usually walked to work, according to the Census Bureau's American Community Survey.

Source: Demo Memo analysis of unpublished tables from the Bureau of Labor Statistics' 2017 American Time Use Survey

Monday, April 15, 2019

2.3 Million Fewer Households with Children

The number of households with children under age 18 has fallen by more than 2 million since 2007 (the year births peaked in the U.S.), according to the Census Bureau...

Number of households with children under age 18
2018: 34,452,000
2007: 36,757,000
Change: –2.3 million

As of 2018, only 27 percent of households included children under age 18, a record low. The share of households with children was as high as 49 percent in the late 1950s and early 1960s.

Source: Census Bureau, Historical Family Tables

Friday, April 12, 2019

Most Gen X Households Have a Dog

Overall, 61 percent of American households have a pet, according to the 2018 General Social Survey. Among Gen Xers, the share is 66 percent, making them the most pet-friendly generation. This makes sense, since many acquired pets as they married and had children. Millennials are in the process of doing the same.

Percent of households with pets by generation, 2018

   Any pet     Dog   Cat
Total households       61%       46%     25%
Millennials       60       43     23
Generation Xers       66       53     28
Boomers       62       50     23
Older Americans       45       33     18

Boomers are about as likely as Millennials to have a pet. Among older Americans (the Silent and World War II generations) fewer than half of households have a pet. Many once had a pet, however. When asked whether they had a pet five years ago, 57 percent of older Americans said yes.

Note: In 2018, Millennials were aged 24 to 41, Generation Xers were aged 42 to 53, Baby Boomers were aged 54 to 72, and Older Americans were aged 73 or older.

Source: Demo Memo analysis of the General Social Survey

Thursday, April 11, 2019

Blacks and Whites Disagree about Racial Discrimination

Which is the bigger problem for the United States: people seeing racial discrimination where it really does NOT exist, or people NOT seeing racial discrimination where it really DOES exist?

That's a necessarily wordy question designed to reveal stark differences in the public's attitudes toward racial discrimination. And reveal them it does. When Pew Research Center asked Americans this question, the great majority of Asians (71 percent), Blacks (84 percent), and Hispanics (67 percent) all said the bigger problem is turning a blind eye to the racial discrimination that really does exist. Only 48 percent of non-Hispanic Whites agreed...

The bigger problem is NOT seeing racial discrimination where it really DOES exist
Asians: 71%
Blacks: 84%
Hispanics: 67%
Non-Hispanic Whites: 48%

There are deep divisions among non-Hispanic Whites on this issue, however. Young adults are most likely to believe the bigger problem is refusing to acknowledge racial discrimination, with 61 percent of adults under age 30 feeling that way. A smaller 40 to 49 percent of those aged 30 or older agree. By education, 59 percent of non-Hispanic White college graduates believe not seeing racial discrimination where it really does exist is the bigger problem. Only 42 percent of those with less education feel the same way. The deepest divide is by party affiliation. Fully 77 percent of non-Hispanic White Republicans believe the bigger problem is seeing racial discrimination where it really does not exist. Fully 78 percent of non-Hispanic White Democrats believe the bigger problem is not seeing racial discrimination where it really does exist.

Source: Pew Research Center, Race in America 2019

Wednesday, April 10, 2019

Student Loans Lower Black Wealth

The wealth gap between Blacks and non-Hispanic Whites is huge. The median household wealth of non-Hispanic Whites was nearly 10 times that of Blacks in 2016—$171,000 versus $17,409, according to an Urban Institute analysis of the Survey of Consumer Finances. While higher rates of homeownership among non-Hispanic Whites are the primary reason for this gap, another reason is student loan debt. Black households are more likely than non-Hispanic White households to have student loans, and Blacks owe more than non-Hispanic Whites. The percentage of Black households with student loan debt has more than doubled since 1989.

Percentage of Black households headed by people aged 25 to 55 with student loan debt, 1989 to 2016 (and average amount owed in 2016 dollars)
2016: 41.8% ($14,225)
2007: 28.3% (  $6,111)
2001: 18.5% (  $2,224)
1989: 17.9% (  $1,161)

Among non-Hispanic White households headed by people aged 25 to 55, a smaller 34 percent had student loan debt in 2016, owing an average of $11,108.

Tuesday, April 09, 2019

Homeownership by Age in 2018

The nation's 64.4 percent homeownership rate in 2018 was significantly higher than the 63.4 percent post-Great Recession low of 2016, according to Census Bureau data. But most age groups are simply treading water, with small or no increases in homeownership during the past two years. Not so for householders aged 30 to 39, their homeownership rates climbing by a statistically significant 2.3 percentage points between 2016 and 2018.

Homeownership rate by age in 2018 and 2016

   2018      2016percentage-point
Total households    64.4%      63.4%           1.0
Under age 25    22.7      21.9           0.8
Aged 25 to 29    32.5      30.9           1.6
Aged 30 to 34    47.7      45.4           2.3
Aged 35 to 39    57.6      55.3           2.3
Aged 40 to 44    62.9      62.0           0.9
Aged 45 to 49    68.4      66.7           1.7
Aged 50 to 54    71.7      71.6           0.1
Aged 55 to 59    74.0      74.0           0.0
Aged 60 to 64    76.8      76.1           0.7
Aged 65 or older    78.5      78.8          -0.3

Despite these gains, the homeownership rates of householders in their thirties remain well below not only what they were during the housing bubble, but also below the historical average prior to the bubble. From 1982 (the first year of the data series) through 1999, for example, the average homeownership rate of 30-to 34-year-olds was 53.0 percent—more than 5 percentage points higher than their 2018 rate. The average homeownership rate of 35-to-39-year-olds during those years was 63.6 percent, fully 6 percentage points higher than their 2018 rate.

Source: Census Bureau, Housing Vacancies and Homeownership

Monday, April 08, 2019

Nearly 1/3 of Least Educated in Labor Force Are "Underutilized"

Seventeen percent of the labor force is "underutilized," according to an analysis by the National Center for Education Statistics of data from the Adult Training and Education Survey, part of the 2016 National Household Education Surveys Program. The survey defines the underutilized as the unemployed, those who have a part-time job but would prefer full-time employment, and those who have a temporary job but would prefer a permanent position. The percentage of labor force participants who are underutilized is highest among the least educated...

Percent of labor force participants who are "underutilized" by education
32% of high school dropouts
21% of high school graduates only
18% of those with some college
16% of those with an associate's degree
11% of those with a bachelor's degree
11% of those with a graduate degree

Source: National Center for Education Statistics, Relationship between Educational Attainment and Labor Force Underutilization

Friday, April 05, 2019

Are You a Have or a Have-Not?

Most Americans (58 percent) do not think the U.S. is divided into Haves and Have-nots, according to a Gallup Survey. While this figure is lower than the 71 percent of 1989, it is higher than the 49 percent of 2008 (in the midst of the Great Recession).

Those most likely to think the country is divided are Democrats (57 percent) and Blacks (70 percent). A smaller 24 percent of Republicans and 36 percent of non-Hispanic Whites agree. Hispanic attitudes mirror those of non-Hispanic Whites, with just 38 percent believing that the country is divided into Haves and Have-nots.

Although the majority of the public does not believe the country is divided into Haves and Have-nots, most Americans can readily classify themselves as one or the other. Fifty-six percent of the public sees itself as a Have, very close to the 58 percent who deny that the U.S. is divided in such a way. Could it be that the Haves are in denial? Those most likely to see themself as a Have are those with household incomes of $100,000 or more (81 percent), college graduates (71 percent), non-Hispanic Whites (64 percent), and Republicans (71 percent).

Overall, 36 percent of Americans identify themselves as a Have-not. Those most likely to see themselves this way are those with household incomes below $40,000, those who did not graduate from college (43 percent), Blacks and Hispanics (57 percent), and political independents (45 percent).

Source: Gallup, Majority Rejects Idea of Haves, Have-Nots Divide in U.S.

Thursday, April 04, 2019

Homeownership Rate Rises Again in 2018

One year ago the nation's homeownership rate posted its first increase in more than a decade. At the time, Demo Memo asked, "Could it be the start of a trend?"

One year later and the answer is...complicated. The homeownership rate is continuing to rise, climbing to 64.4 percent in 2018, according to the Census Bureau's Housing Vacancy Survey (HVC). This is 1.0 percentage point higher than the post-Great Recession low of 63.4 percent recorded in 2016. Despite the increase, however, the 2018 homeownership rate remains relatively low. It is the fourth lowest rate of the 2000s (surpassing only the rates in 2015, 2016, and 2017).

Homeownership rate for selected years
2018: 64.4%
2017: 63.9%
2016: 63.4% (post Great Recession low)
2015: 63.7%
2010: 66.9%
2004: 69.0% (all-time peak)
2000: 67.4%
1990: 63.9%
1980: 65.6%
1970: 64.2%

But perhaps comparing today's homeownership rate with the pumped-up rates of the housing bubble does not provide the necessary perspective. It might be more instructive to compare the 2018 rate to homeownership rates prior to the housing bubble. During the 30-year span from 1970 to 2000, the homeownership rate ranged from a low of 63.8 percent in 1988 to a high of 66.8 percent in 1999. The average rate during the time period was 64.7 percent, almost identical to the 64.4 percent of 2018. This exercise suggests, then, that today's homeownership rate is not the new normal. It's the old normal. 

Source: Census Bureau, Housing Vacancies and Homeownership

Wednesday, April 03, 2019

Most Americans Support LGBT Protections

Most Americans agree: there should be nondiscrimination protections for the LGBT population. Fully 69 percent of the public favors "laws that would protect gay, lesbian, bisexual, and transgender people against discrimination in jobs, public accommodations, and housing," finds a PRRI survey.

The majority of every religious group, men, women, every age group, and every race and Hispanic origin group supports laws against LGBT discrimination. By religious affiliation, support ranges from a high of 90 percent among Unitarians to a low of 53 percent among Jehovah Witnesses. By party affiliation, 79 percent of Democrats and 56 percent of Republicans favor such laws. Good news, right?

But dig a little deeper into the PRRI survey results, and a contradiction emerges. Another question in the survey asks Americans whether they favor or oppose religiously-based service refusals of the LGBT population—in other words, can a small business owner refuse to provide products or services to the LGBT population if doing so violates the owner's religious beliefs. Fifty-seven percent of the public opposes service refusals. Note that this 57 percent is smaller than the 69 percent of the public that favors nondiscrimination protections. A PRRI analysis of the results finds that fully 23 percent of Americans hold contradictory views—they favor nondiscrimination laws to protect the LGBT population but would allow a small business owner to discriminate against the LBGT population based on the owner's religious beliefs.

Source; PRRI, Fifty Years After Stonewall: Widespread Support for LGBT Issues—Findings from American Values Atlas 2018

Tuesday, April 02, 2019

Attitudes toward Marijuana Legalization by Generation

Americans may not agree on much, but they are close to a consensus on the legalization of marijuana. Two-thirds of the public (66 percent) says the use of marijuana should be legal, according to the 2018 General Social Survey. This is up from 48 percent who felt that way in 2010 and just 33 percent who favored it in 2000.

Percent who think the use of marijuana should be legal by generation, 2018
Millennials: 76%
Gen Xers: 62%
Boomers: 62%
Older: 34%

While support for the legalization of marijuana has been growing for more than a decade, the biggest gains have occurred since 2010. The percentage of Millennials who favor legalization jumped by 20 percentage points between 2010 and 2018—from 56 to 76 percent. Support from Gen Xers climbed 19 percentage points during those years. Interestingly, Boomers were more supportive than Gen Xers in 2010 (54 versus 43 percent), but the two generations are now equally in favor. The generations that precede the Baby Boom (Silent and World War II) are the only ones who have not yet embraced the idea. They probably never will. The percentage of older Americans who favor legalization increased by just 2 percentage points between 2010 and 2018.

Note: In 2018, Millennials were aged 24 to 41, Generation Xers were aged 42 to 53, Baby Boomers were aged 54 to 72, and Older Americans were aged 73 or older.

Source: Demo Memo analysis of the General Social Survey

Monday, April 01, 2019

Older Women Are the 3rd Biggest Game Players

On an average day, 11 percent of Americans aged 15 or older play games, according to the American Time Use Survey (ATUS). This time use category includes not only computer and video games but also board and card games. Young men are most likely to play games on an average day, with 43 percent of men aged 15 to 19 and 29 percent of those aged 20 to 24 doing so. But look who is in third place...

Percent who play games on an average day (top five demographic segments)
43% of men aged 15 to 19
29% of men aged 20 to 24
17% of women aged 65 or older
15% of men aged 25 to 34
14% of women aged 20 to 24

Don't assume women aged 65 or older are playing only bridge or Bunco. According to a 2017 Pew Research Center survey, a substantial 30 percent of women aged 50 or older say they sometimes/often play video games.

Source: Demo Memo analysis of the 2017 American Time Use Survey