One-Quarter Of U.S. Households Are Wealth-Poor

New Report Finds One-Quarter Of U.S. Households Are Wealth-Poor

One-quarter (25%) of U.S. households have net assets under $10,000, and therefore are "wealth-poor," concludes a joint report by the Consumer Federation of America (CFA), the National Credit Union Foundation (NCUF), and the Credit Union National Associati


FOR IMMEDIATE RELEASE
Contact: Jack Gillis, CFA, [phone]
or
Mark Wolff,
CUNA, [phone]





Washington, D.C. -- One-quarter (25%) of U.S. households have net assets under $10,000, and therefore are
"wealth-poor," concludes a joint report by the Consumer Federation of America (CFA), the National Credit Union
Foundation (NCUF), and the Credit Union National Association (CUNA). The report also found that these wealth-
poor households are more likely than other American families to plan for the next few months, rather than years;
spend more than their incomes; and not save regularly.



"Wealth-poor Americans are only a lay-off or emergency expenditure away from financial disaster," noted
Stephen Brobeck, CFA Executive Director. "Wealth-poor Americans also lack the financial assets which allow
investments in a home, an education, a personal business, or securities," he added.



The report also concluded that there are two types of wealth-poor households -- young debtors and the income
poor. Young debtors tend to have debts larger than their assets; they also tend to spend more than their
incomes. Most of the income poor, who are more likely to have lower incomes and less education than young
debtors, do not carry installment or credit card debt.



"Living paycheck to paycheck is no way to live -- not if you want to own a home, send your kids to college, or
build a retirement nest egg," said CUNA CEO Daniel A. Mica, who is also president of the NCUF. "Credit unions
recognize this and are involved in a number of programs to foster savings and put their members on a solid
financial footing."



"Credit unions are a natural vehicle for helping Americans build wealth," adds NCUF Executive Director Gary
Officer. "We have access, means, and, most importantly, we have the desire to help."



The report used the latest data from the Federal Reserve Board's Survey of Consumer Finances, which dates from
1998. Professor Catherine P. Montalto, at Ohio State University, analyzed these data for CFA, NCUF, and
CUNA.



The Wealth-Poor Have Different Financial Attitudes Than Other Americans



As the table below indicates, the wealth-poor tend to be young, have low- or moderate-incomes, and rent rather
than own homes. They also tend to plan for the next few months rather than for at least five years; tend to
spend more than their incomes; tend not to save; and tend to be unwilling to take financial risks when saving or
investing.