Assessing Financial Security of Low Income Households in the United States
Journal of Poverty, Forthcoming
34 Pages Posted: 14 Apr 2015 Last revised: 23 Dec 2015
Date Written: December 21, 2015
We used three financial ratios to measure the financial security of low income households: the liquidity, debt-to-income (DTI), and solvency ratios. Our analytic sample included non-retired households with incomes no greater than three times the poverty threshold as reported by the U.S. Census Bureau. From the 2010 Survey of Consumer Finances (SCF) dataset, we found that households in the higher poverty threshold were more likely to meet the recommended guidelines for the DTI and solvency ratios. This study provides important insights for researchers and policymakers in the areas of poverty and household finance.
Keywords: Financial Security, Financial Ratio, Poverty, Low Income Households, Survey of Consumer Finances
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