MADISON, Wis.-It's likely many members will be feeling increased debt-related stress in 2009. A new report offers suggestions on how such stress affects different members.
The report, part of an ongoing effort to analyze issues affecting the future of consumer finance by the Filene Research Institute, focuses specifically on credit card debt.
It is the second in a series of Consumer Finance Research Briefs, based on information derived from Ohio State University's Consumer Finance Monthly (CFM) survey.
Among the questions and analysis posed in "Consumer Debt Stress and Credit Cards" by Filene Executive Director and CEO Mark Meyer:
* Did levels of consumer debt stress increase in 2007 from 2006 as the sub-prime mortgage crisis publicly unfolded? The CFM shows that consumers in top stress categories who worry about overall debt rose to 16.2 in 2007 from 14.7 in 2006.
* How do levels of consumer debt stress vary by credit card debt indicators such as total credit card debts, missed payments, accounts sent to collections, and previous bankruptcies?
A prior bankruptcy filing, for example, increases the likelihood that a survey respondent will report high levels of debt-related stress, the report found, with Meyer adding, "This suggests that bankruptcy is merely a temporary solution to an ongoing problem."
* How do levels of consumer debt stress vary by demographic variables such as age, annual household income, gender, race/ethnicity, and marital status?
CFM data indicate that individuals with higher overall debt stress levels have lower household incomes than do those with lower debt stress levels, according to the report.
Those with the lowest household incomes are likely to endure the highest levels of debt- related stress.
Filene noted the CFM is generated through a continuous monitoring survey of consumer households and their financial conditions.
Since its official launch in February 2005, the Center for Human Resource Research (CHRR) at Ohio State University has been collecting CFM data through a monthly 25-minute telephone survey utilizing random-digit dialing and weighting procedures to ensure a statistically valid, nationally representative sample of U.S. adult consumer households.
Data collected since CFM's inception have grown by an average of 333 completed interviews each month, bringing the total to 10,986 observations as of year-end 2007.
For info: 608-231-8550 or filene.org.
