The Financial Diaries

How American Families Cope in a World of Uncertainty

Jonathan Morduch, Rachel Schneider

• Publisher: Princeton University Press
• Year: 2017
• Print ISBN: 9780691183145, 9780691172989
• eBook ISBN: 9781400884599
• Topic: Personal Development
• Subtopic: Business General

What the financial diaries of working-class families reveal about economic stresses, why they happen, and what policies might reduce them

Deep within the American Dream lies the belief that hard work and steady saving will ensure a comfortable retirement and a better life for one's children. But in a nation experiencing unprecedented prosperity, even for many families who seem to be doing everything right, this ideal is still out of reach.

In The Financial Diaries, Jonathan Morduch and Rachel Schneider draw on the groundbreaking U.S. Financial Diaries, which follow the lives of 235 low- and middle-income families as they navigate through a year. Through the Diaries, Morduch and Schneider challenge popular assumptions about how Americans earn, spend, borrow, and save—and they identify the true causes of distress and inequality for many working Americans.

We meet real people, ranging from a casino dealer to a street vendor to a tax preparer, who open up their lives and illustrate a world of financial uncertainty in which even limited financial success requires imaginative—and often costly—coping strategies. Morduch and Schneider detail what families are doing to help themselves and describe new policies and technologies that will improve stability for those who need it most.

Combining hard facts with personal stories, The Financial Diaries presents an unparalleled inside look at the economic stresses of today's families and offers powerful, fresh ideas for solving them.

Index

A page number in italics refers to a figure or table.

Active Hours, 175

Affordable Care Act (Obamacare), 166, 186n16

AirBnB, 41–42

All Our Kin (Stack), 140

American Dream, 6

American Dream Demonstration, 94–96, 100, 106, 139

Ant and Grasshopper, 107

Aspen Institute, 171

attention, as limited resource, 43, 79

auto title loans, 25, 44, 135

Bane, Mary Jo, 161

bank accounts: asset limits for food stamps and, 167; avoided when finances are volatile, 175; Janice Evans’s savings system in, 81–83, 103–4; keeping cash at home and, 135; overdrafts in, 76, 175

Banking Up, 101–2

Bank of Far Away, 103–4

Bank of Mom, 103, 108–9

bankruptcy: debt level inescapable except through, 123; difficulty of obtaining credit after, 125, 137; moral judgments about, 112; as protection for borrowers, 126; Sandra Young’s credit card debt leading to, 117

Becky and Jeremy Moore. See Moore, Becky and Jeremy

behavioral economics, 104

Benartzi, Shlomo, 104

benefits for employees: for casino card dealer, 23; erosion of, 170; loss of manufacturing jobs and, 2; proposed new models of, 171

benefits from government. See public benefits; safety net

Benitez, Lucia, 104–5, 137–38

Blake, Taisha, 16, 154–56

bill payment. See paying bills

borrowing: balancing structure and flexibility in, 138–39, 176; for $400 emergency, 72; misalignments between borrowers and lenders in, 125–27; moral judgment about, 107; protecting the rights of borrowers in, 127–29, 172; to smooth consumption, 69, 78–79; from start-up lender Vouch, 142–44; suggestions for financial institutions, 147; volatility of income and, 4, 43. See also credit; credit cards; debt; payday loans

borrowing from family or friends: advantages of, 136–37; annual amount per household, 140; common among Diaries families, 134–35; complicating relationships, 139; to cover three months of expenses, 73–74; in Federal Reserve SHED survey, 135–36; by Sarah Johnson, 49, 50; by Becky Moore, 3, 70, 73; to pay street vendor fine, 131–32; rarely charging interest, 136

Bourdieu, Pierre, 180n15

build...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Dedication Page
• Contents
• Acknowledgments
• Preface to the Paperback Edition
• Introduction: A Hidden Inequality
• Worlds of Uncertainty
• How Families Cope
• New Ways of Seeing
• Notes
• Bibliography
• Index