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Consumer Debt Delinquency over Life Cycle Stages

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  • Jing Jian Xiao
  • Rui Yao

Abstract

Consumer debt delinquency, as measured by being 60 or more days late in in debt payment, is an indicator of financial ill health. Using six datasets of the 1992-2007 U.S. Surveys of Consumer Finances, this study examines consumer debt delinquency over life cycle stages. Inspired by previous research (Du & Kamakura, 2006), fifteen life cycle stages are defined by household head’s age, marital status, and presence and age of children. Multivariate logistic results show that young couples status, and presence age of children. Multivariate logistic results show that young couples and singles with children aged 7 or older and middle aged singles with children aged 15 or older are found to have the highest risk of debt delinquency. Findings suggest that presence and age children are have the highest risk of debt delinquency. Findings suggest that presence and age of children are important factors affecting consumer debt delinquency, which should be considered in public policies that aim to improve consumer financial well-being.

Suggested Citation

  • Jing Jian Xiao & Rui Yao, 2011. "Consumer Debt Delinquency over Life Cycle Stages," NFI Working Papers 2011-WP-18, Indiana State University, Scott College of Business, Networks Financial Institute.
  • Handle: RePEc:nfi:nfiwps:2011-wp-18
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    File URL: http://www.indstate.edu/business/sites/business.indstate.edu/files/Docs/2011-WP-18_Xiao_Yao.pdf
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    References listed on IDEAS

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    1. Ana M. Aizcorbe & Arthur B. Kennickell & Kevin B. Moore, 2003. "Recent changes in U.S. family finances: evidence from the 1998 and 2001 Survey of Consumer Finances," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Jan, pages 1-32.
    2. Karen E. Dynan, 2009. "Changing Household Financial Opportunities and Economic Security," Journal of Economic Perspectives, American Economic Association, vol. 23(4), pages 49-68, Fall.
    3. Martin Browning & Thomas F. Crossley, 2001. "The Life-Cycle Model of Consumption and Saving," Journal of Economic Perspectives, American Economic Association, vol. 15(3), pages 3-22, Summer.
    4. Schaninger, Charles M & Danko, William D, 1993. " A Conceptual and Empirical Comparison of Alternative Household Life Cycle Models," Journal of Consumer Research, Oxford University Press, vol. 19(4), pages 580-594, March.
    5. Orazio P. Attanasio & Guglielmo Weber, 2010. "Consumption and Saving: Models of Intertemporal Allocation and Their Implications for Public Policy," Journal of Economic Literature, American Economic Association, vol. 48(3), pages 693-751, September.
    6. Wagner, Janet & Hanna, Sherman, 1983. " The Effectiveness of Family Life Cycle Variables in Consumer Expenditure Research," Journal of Consumer Research, Oxford University Press, vol. 10(3), pages 281-291, December.
    7. Diann Moorman & Steven Garasky, 2008. "Consumer Debt Repayment Behavior as a Precursor to Bankruptcy," Journal of Family and Economic Issues, Springer, vol. 29(2), pages 219-233, June.
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    Cited by:

    1. Lawrence M. Berger & J. Michael Collins & Laura Cuesta, 2016. "Household Debt and Adult Depressive Symptoms in the United States," Journal of Family and Economic Issues, Springer, vol. 37(1), pages 42-57, March.

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