Financial Update (July-September 2001)
Consumer Finance Survey Gives Insights for Policymakers
n May the Federal Reserve Board began a Survey of Consumer Finances that will provide policymakers with important insights into the economic condition of American families.
The survey, undertaken every three years since 1983, is being conducted for the Federal Reserve by the National Opinion Research Center (NORC) at the University of Chicago.
“Although good overall information on the major sectors of the economy is available regularly, our knowledge about the financial circumstances faced by different types of households is much more limited,” said Alan Greenspan, chairman of the Federal Reserve Board, in a letter to prospective survey participants. “Our survey is intended to fill a key part of this gap.” The data collected will provide a picture of what Americans own — from houses and cars to stocks and bonds — how and how much they borrow, and how they bank. The 2001 survey contains a new question regarding the degree to which saving decisions are affected by the availability of informal financing options, such as borrowing from relatives or friends. Answers to this question will help identify the contribution of “precautionary savings” to total savings.
The results of previous studies have been important in policy discussions about pension and social security reform, tax policy, deposit insurance reform and a broad range of other issues.
A letter urging participation in the survey was mailed to approximately 10,000 households chosen at random using a scientific sampling procedure in 100 areas across the United States. An NORC surveyor contacts each letter recipient to explain the project and set up an interview. The data collection systems are designed with extensive safeguards to protect the anonymity of survey participants.
Summary results for the 2001 survey will be published in early 2003 after the data have been thoroughly analyzed. Highlights of the 1998 survey are available in the January 2000 issue of the Federal Reserve Bulletin at www.federalreserve.gov/pubs/bulletin.