1. Board of Governors of the Federal Reserve System Selected Findings from the Survey of Household Economics and Decisionmaking Dave Buchholz Federal Reserve Board Seventh Annual Financial Literacy Leadership Conference September 29, 2014 My comments today represent my own views. They do not necessarily represent the views of the Federal Reserve Board of Governors or its staff.

2. Board of Governors of the Federal Reserve System 2 Full report available at federalreserve.gov

3. Board of Governors of the Federal Reserve System Major survey topics Household Economic Well-Being Housing and Living Arrangements Credit Behavior and Access to credit Savings Education, Student Loans, and Job Readiness Retirement Planning and Saving Health Care Expenses 3

4. Board of Governors of the Federal Reserve System Well-Being 4

5. Board of Governors of the Federal Reserve System Household Economic Well-Being 5 Which one of the following best describes how well you are managing financially these days? Asked of all respondents. n = 4,134

6. Board of Governors of the Federal Reserve System 6 Which one of the following best describes how well you are managing financially these days?

7. Board of Governors of the Federal Reserve System Compared to five years ago (2008), would you say that you (and your family living with you) are better off, the same or worse off financially? 7

8. Board of Governors of the Federal Reserve System Saving 8

9. Board of Governors of the Federal Reserve System 9 In 2012, about how much of your income did your household set aside as savings as a percent of your total gross household income (before taxes and deductions)?

10. Board of Governors of the Federal Reserve System Reasons for Saving 10 Asked of those who reported saving a positive portion of their income. n=2,270 “Which of the following categories, if any, are you saving money for? “

11. Board of Governors of the Federal Reserve System If you were to lose your main source of income (e.g. job, government benefits), could you cover your expenses for 3 months by borrowing money, using savings, selling assets, or borrowing from friends/family? Those responding “Yes” 11

12. Board of Governors of the Federal Reserve System Ability to cover $400 expense 12 Asked of all respondents. n = 4,134 Suppose that you have an emergency expense that costs $400. Based on your current financial situation how would you pay for this expense? Among the 33% of respondents who could pay but would use some form of debt or sell something (respondents can choose multiple options)% Credit card – paid off over time49 Borrow from friends or family27 Sell something20 Use a bank loan9 Use a payday loan8 Other6 Use cash or credit card paid in full (in combination with one or more forms of debt or sales)27

13. Board of Governors of the Federal Reserve System Before 2008, did you or your household have any savings, including stocks, money in a savings account, or pensions? 13 n=4,134

14. Board of Governors of the Federal Reserve System Of those who had had savings: “Since 2008, have you or your household had to use up some, nearly all, or all of your savings to pay for bills and expenses?” 14 n=2,845

15. Board of Governors of the Federal Reserve System Retirement 15

16. Board of Governors of the Federal Reserve System Retirement planning by age 16 Asked of those not currently retired. n=3,163 How much thought have you given to the financial planning for your retirement?

17. Board of Governors of the Federal Reserve System Retirement planning by income 17 Asked of those not currently retired. n=3,163

18. Board of Governors of the Federal Reserve System Retirement 18 Which one of the following best describes your plan for retirement? 18-29 % 30-44 % 45-59 % 60+ % Total % I do not plan to retire56836 Work fewer hours as I get close to retirement141061410 Retire from my current career, but then find a different full-time job54404 Retire from my current career, but then find a different part-time job1513181716 Retire from my current career, but then work for myself1011106 Work full time until I retire, then stop working altogether3529221525 Keep working as long as possible1622212821 Other1410167 Asked of those not currently retired who have given at least “some” thought to retirement. n=1,766

19. Board of Governors of the Federal Reserve System Retirement savings types, by age 19 Asked of those not currently retired. n=3,163

20. Board of Governors of the Federal Reserve System Have no retirement savings or pension: 20

21. Board of Governors of the Federal Reserve System Retirement and the Great Recession Compared to your retirement plans before 2008, would you say that you now plan to retire… Age 45-5960+All Respondents %% Plan to retire earlier 565 Plan to retire at the same age 342733 Plan to retire later 41 36 Didn’t think about retirement prior to 2008 192524 21 Among those not retired who had given at least “some” thought to retirement: Asked of those not currently retired who have given at least “some” thought to retirement. n=1,766

22. Board of Governors of the Federal Reserve System Not Just Lack of Retirement Savings (Just Broke?) Of those who report no retirement savings or pension: – 67% also said they didn’t regularly put money into savings account (vs. 47% overall) – 86% didn’t have 3 months’ rainy-day funds (vs. 58% overall) 22

23. Board of Governors of the Federal Reserve System Overall Financial Challenges 23

24. Board of Governors of the Federal Reserve System Self-described financial challenges “In a sentence or two, please describe the main financial challenges or concerns facing you or your family?” 1,616 respondents indicated that they currently had none 2,265 provided a written response 24

25. Board of Governors of the Federal Reserve System Top Issues 25 Self-described financial challenges Among those who offered a response. n = 2,265

26. Board of Governors of the Federal Reserve System In a sentence or two, please describe the main financial challenges or concerns facing you or your family? 26 Total Responses: 2,265