Sherman D. Hanna

The Ohio State University | OSU · Department of Human Sciences

Traditional life cycle, revised life cycle, and family composition variables are compared in models predicting total family clothing expenditures. There is little difference in the predictive ability of the three sets of variables. In models controlling for socioeconomic and demographic variables, family life cycle and family composition variables...

Retirement adequacy is estimated using a 1995 United States sample of households. Based onmean lognormal portfolio projections and current contribution rates, 52% of households areadequately prepared for retirement. Based on pessimistic projections, only 42% of households areadequately prepared. A regression of the ratio of projected wealth to need...

This study estimates the adequacy of retirement wealth of pre-retirement households using a 1995 national sample of households. Retirement wealth is projected using planned retirement age and portfolio allocation. Retirement needs are estimated from expenditure functions, and 52% of the households were adequately prepared. Households that spent les...

This study explores financial knowledge patterns from 2009 to 2018, focusing on objective and subjective knowledge, overconfidence in financial knowledge, and “Don’t know” responses. We used four waves of National Financial Capability Study (NFCS) datasets. Objective financial knowledge was lower in 2018 than in 2009, and the proportion of individu...

Investment literacy and cryptocurrency investment 2 Investment literacy, overconfidence and cryptocurrency investment Abstract Cryptocurrency has been increasingly popular with investors. Using the 2018 National Financial Capability Study Investor survey, we examined the association between investment literacy and cryptocurrency investment. About 1...

This study explores financial knowledge patterns from 2009 to 2018, focusing on objective and subjective knowledge, overconfidence in financial knowledge, and "Don't know" responses. We used four waves of National Financial Capability Study (NFCS) datasets. Objective financial knowledge was lower in 2018 than in 2009, and the proportion of individu...

We examined the association between financial knowledge overconfidence and the perception of emergency fund needs using the 2016 Survey of Consumer Finances (SCF) dataset. Only 28% of respondents reported a perceived amount of emergency funds needed that would cover at least 3 months of estimated spending. We conducted an OLS regression analysis on...

Using a sample of 1,215 US retail investors, we provide evidence on the effect of investment literacy and of investment literacy overconfidence on the likelihood of purchasing securities on margin, and also, among those who had purchased securities on margin, the likelihood of experiencing a margin call. Based on multivariate analyses, the likeliho...

During a period of increasing prosperity, the U.S. debt delinquency rate decreased between 2016 and 2019, with a relatively large decrease for Asians households and somewhat smaller decrease for Blacks and Whites, while the rate for Hispanics stayed constant. Blacks were more likely to be delinquent than Whites and Hispanics. Controlling for househ...

Using a sample of 1,215 US retail investors, we provide evidence on the effect of investment literacy and of investment literacy overconfidence on the likelihood of purchasing securities on margin, and also, among those who had purchased securities on margin, the likelihood of experiencing a margin call. Based on multivariate analyses, the likeliho...

Which spouse is more knowledgeable about the household's finances in mixed‐sex married couple households? The answer to this question can be inferred from the Survey of Consumer Finances (SCF), which assigns the title of “respondent” to the person the household indicates is more knowledgeable about its finances. In the 2016 SCF, the husband was the...

Which spouse is more knowledgeable about the household's finances in mixed-sex married couple households? The answer to this question can be inferred from the Survey of Consumer Finances (SCF), which assigns the title of "respondent" to the person the household indicates is more knowledgeable about its finances. In the 2016 SCF, the husband was the...

Early distributions from retirement accounts could endanger future retirement income security, and the U.S. has restrictions to discourage them, including possible tax penalties. On the other hand, tapping one's retirement assets may be rational when an individual encounters financial hardship. With the 2020 Coronavirus Aid, Relief, and Economic Se...

Early distributions from retirement accounts could endanger future retirement income security, and the U.S. has restrictions to discourage them, including possible tax penalties. On the other hand, tapping one's retirement assets may be rational when an individual encounters financial hardship. With the 2020 Coronavirus Aid, Relief, and Economic Se...

The Survey of Consumer Finances (SCF) has included a 4-level risk tolerance measure since 1983. In 2016, the SCF also included an 11-level risk tolerance measure. We compare the two measures, and develop suggestions for using the new measure. While the new measure is seemingly simpler than the old measure, we demonstrate that it does not have a mon...

This editorial describes the current status and trends in the past three decades (1990–2019) of the Journal of Financial Counseling and Planning (JFCP). Since its first issue published in 1990, JFCP has become a major research outlet in consumer finance. The journal publishes cutting-edge, peer-reviewed, original research papers on consumer financi...

Based on our analyses of Survey of Consumer Finances datasets, the proportion of households owning a life insurance policy decreased from 72% in 1992 to 60% in 2016. We estimated logistic regressions on the likelihood of ownership of any, term, and cash value life insurance. We conclude that changes in household characteristics accounted for the de...

This study used data from the 2015 National Financial Capability Study to analyze the adoption of mobile payments by U.S. households. While 24% of respondents used mobile payments, the mean rate for those under age 25 was 11 times the rate for those 65 and older. State rates ranged from about 9% in Montana to 34% in Washington, DC. Based on a logis...

This study investigated the effect of objective and subjective financial literacy on mortgage payment delinquency using the 2015 National Financial Capability Study dataset. A hierarchical model showed a substantial negative effect of objective literacy on delinquency, but subjective literacy did not have a significant effect. The predicted likelih...

We test whether Asian parents place more importance on helping their children with college costs than parents in other racial/ethnic groups. Some previous research has shown that Asian parents are more likely than comparable White parents to list saving for college as an important goal, but does that indicate that they place more importance on help...

The decrease in life insurance ownership: Implications for financial planning Abstract Based on our analyses of Survey of Consumer Finances datasets, the proportion of households owning a life insurance policy decreased from 72% in 1992 to 60% in 2016. We estimated logistic regressions on the likelihood of ownership of any, term, and cash value lif...

We analyzed factors related to the financial risk tolerance of Chinese households, using the 2011 China Household Finance Survey (CHFS). The risk tolerance question was similar to one in the U.S. Survey of Consumer Finances (SCF), and we found that CHFS respondents had slightly higher risk tolerance than SCF respondents, but the percent of househol...

The demographic changes in the U.S population and the impending depletion of the Social Security Fund both prompt the need for research on factors related to delayed retirement expectations. The purpose of this research is to discern the factors that could affect workers’ choices to delay retirement. This study focuses on the retirement expectation...

Nowadays, most married families are dual-worker families and woman will also participate in the labor market. So the determination of factors related to each spouse’s delayed retirement expectation in couple households is an important topic that was understudied by previous studies. Delayed retirement expectation bears meanings for mitigating the p...

We analyzed factors related to the financial risk tolerance of Chinese households, using the 2011 China Household Finance Survey (CHFS). The risk tolerance question was similar to one in the U.S. Survey of Consumer Finances (SCF), and we found that CHFS respondents had slightly higher risk tolerance than SCF respondents, but the percent of househol...

We tested whether Asian American parents place more importance on helping their children with college costs than parents with other racial/ethnic groups. Our logistic regression controlling for household characteristics shows that among households with at least one child age 13 to 17, Asian American parents are not different from other racial/ethni...

The Survey of Consumer Finances (SCF) is the most frequently used dataset for research in this journal, but many researchers and readers do not fully understand some of the dataset's complex details. This article provides insight into important issues that researchers and readers need to understand to accurately conduct and interpret SCF-based rese...

This study investigates the effect of risk aversion of single-parent households with at least one child under 18 on life insurance ownership. Analyzing the 1992-2013 Survey of Consumer Finances datasets, we found that the likelihood of owning term life insurance decreases as risk aversion increases, but the likelihood of owning cash-value life insu...

Demographic changes in China and the shortfall of the Social Security Fund call for research on the determinants of delayed retirement decisions. The purpose of this research, which draws from the Chinese Household Finance Survey, is to identify the main economic factors that affect workers’ decisions to delay retirement, even when eligible for the...

The Survey of Consumer Finances (SCF) is the most frequently used dataset for research in this journal, but many researchers and readers do not fully understand some of the dataset’s complex details. This article provides insight into important issues that researchers and readers need to understand to accurately conduct and interpret SCF-based rese...

It has been well established in the literature that financial advice leads to informed decision‐making and improved financial outcomes. However, there is limited evidence regarding the link between financial planner use and attitudes toward retirement saving. As financial planners provide comprehensive advice for the long‐term benefits of clients,...

The purpose of this study was to analyze how having an education loan affected U.S. renter and homeowner households had a heavy financial obligations burden. In 1992, only 15% of homeowners had financial obligation payments over 40% of income (heavy burden), but the proportion increased to 22% by 2007, then dropped to 16% by 2013. The proportion of...

This study investigates racial/ethnic differences in high return investment ownership in the U.S. Households with low levels of financial assets might not be able to meaningfully make investment choices, so a Heckman two-stage selection model was used to separate minimum asset level status from the allocation decision, specifically in whether house...

Between 2006 and 2008, 9% of Korean households had an income decrease of 50% or more, a rate almost identical to the U.S., despite the much lower impact of the global financial crisis on Korea. We ran a logistic regression to determine factors related to the likelihood of a substantial income decrease between 2006 and 2008 for Korean households. Th...

In the 2013 Survey of Consumer Finances, 18% of full-time workers aged 35 to 60 who were household heads expected to never retire. Do these never retire responses indicate a plan to never retire or an inability to plan? Factors related to expecting to never retire were more related to a failure to plan rather than a preference for working indefinit...

We examine the effects of self-control mechanisms on saving behavior using the 2013 Survey of Consumer Finances (SCF), following the assumptions of research that analyzed the 1998 SCF. Self-control mechanisms include saving goals, foreseeable expenses, and saving rules. We find a positive effect of having one or more saving rules on the likelihood...

1. The typical treatment of inflation in retirement planning textbooks is too complex and is not reasonable in terms of the amount to contribute the first year being dependent on the inflation rate assumption. 2. Economists typically put all amounts and interest rates in inflation-adjusted terms, which is simpler and a more rational approach to lon...

Household time preference for US households, as measured by the planning horizon, was fairly stable for many years, but sharply changed with the onset of the Great Recession. Based on an analysis of a combination of the 1992-2013 Survey of Consumer Finances datasets, time preference increased in 2010 and remained high in 2013, indicating households...

We examined the effects of using bootstrap weights to account for the complex sample design in analyses of Survey of Consumer Finances (SCF) datasets. No article published in this journal that has used the SCF has mentioned the issue of complex sample designs. We compared results obtained without weights and with application of population and boots...

Some textbooks suggest using financial ratios to provide simple indicators of whether households are making appropriate financial decisions. We investigate three investment ratios mentioned in textbooks: investments to net worth, investments to annual income, and investments to total assets. We conduct regressions on respondent evaluation of the ad...

Household time preference for US households, as measured by the planning horizon, was fairly stable for many years, but sharply changed with the onset of the Great Recession. Based on an analysis of a combination of the 1992–2013 Survey of Consumer Finances (SCF) datasets, time preference increased in 2010 and remained high in 2013, indicating hous...

Roughly half of working households in the USA are not saving enough to be able to maintain their current spending after retirement. Scholz et al. (2006) obtained an estimate of 80 % of working households saving enough because of their assumption about the personal discount rate that implied much lower optimal spending in retirement than before reti...

1. Mixed sex married couples represent about 48% of households in the United States, but have about 77% of the household net worth. 2. In mixed sex married couple households in 2013, only 43% of wives were considered more knowledgeable about household finances than the husband, the lowest proportion ever recorded in the Survey of Consumer Finances....

1. This research examines the potential impact of the stock market crash of 2008-2009 on U.S. working households. The Great Recession caused financial problems for many households in terms of unemployment, business losses, and decreases in real estate values, but the broadly based decreases in stock indexes impacted households in all areas of the U...

The topic of retirement savings can be considered from a prescriptive (normative) approach, for which the primary question is how much should a household accumulate for retirement. The topic can also be considered from a descriptive (positive) approach, for which the most important question is whether households are saving enough for retirement. Us...

Lack of financial sophistication has been suggested as a cause of retirement plan failure. We extend previous studies of retirement adequacy by testing the effect of financial sophistication proxies on projected retirement adequacy, using the 2010 Survey of Consumer Finances (SCF) dataset. We found that only 44% of households with a full-time head...

We extend previous studies of retirement adequacy by testing the effect of financial sophistication proxies on projected retirement adequacy, using the 2010 Survey of Consumer Finances (SCF) dataset. We found that only 44% of households with a fulltime head aged 35 to 60 are adequately prepared for retirement in 2010, compared to 58% in 2007. Our m...

Version of 1989 paper translated to Korean by Jaimie Sung, 1996. Hanna, S. (1989). Optimization for family resource management. Proceedings of the Southeastern Regional Association for Family Economics-Home Management Conference, 4-16.

This paper is an exploration of the impact of the presence of a disabled person in the household on overall housing satisfaction, controlling for housing conditions. A sample of 1,010 households in Montgomery, Alabama was interviewed to assess housing conditions and satisfaction. The data were analyzed with stepwise multiple regression. The results...

To assess the magnitude of the advantage of logit analysis over ordinary least squares regression, the two methods are used for similar models of ownership and ownership preference as functions of age and age squared. The extent of the differences between the two methods Is shown in graphs. For most purposes, it makes little difference which method...

Housing and other expenditures of renter households in the 1973 U.S. Bureau of Labor Statistics Survey of Consumer Expenditures were analyzed to ascertain the impact of high rent expenditures on other consumer expenditures. The impact of high health care and transportation expenditures on spending was also examined. Multiple regressions of expendit...

This study examines the divergence between objective and subjective assessment of retirement adequacy, analyzing U.S. households with a full-time worker age 35 to 60 in the 2010 Survey of Consumer Finances. Of those households, 58% have objective inadequacy, and 54% have subjective inadequacy, but only 52% have objective/subjective consistency. Our...

We investigated racial/ethnic differences in high return investment ownership using the 2010 Survey of Consumer Finances (SCF). Logistic regression analysis shows that even after controlling for income, risk tolerance, education, and other factors, Black and Hispanic households are less likely to hold high return investments than White households,...

Most research studying family financial behavior of racial/ethnic groups has ignored Asian households or arbitrarily combined them with other racial/ethnic groups. We treated Asian households as a separate racial/ethnic group to compare twelve financial behaviors and attitudes of Asian households to those of three other racial/ethnic groups: White,...

This research sought to further understanding of factors related to low-income household saving behavior. Saving behavior, defined as whether a household spent less than income, was analyzed by applying institutional theory, which proposes that households’ institutional environment has a substantial effect on financial decisions. Two logistic regre...

The purpose of this study was to examine associations between saving goals and saving behavior from a perspective of Maslow’s Hierarchy. Using 1998-2007 Surveys of Consumer Finance data, we analyzed responses given to an open-ended saving reason question, and categorized responses into six saving goals. The retirement/security goal was the most fre...

Many researchers have examined the influence of the financial planning horizon variable in the Survey of Consumer Finances and the Health and Retirement Study. The question asks respondents to choose the most important time period for saving and spending decisions. These researchers have assumed that the variable reflects the time preference of res...

We examined the financial knowledge pathways to their money management awareness attitude, behavior and outcome among the Asian college students and also try to analyze gender differences. The result was shown, basically, financial knowledge affects attitude and attitude affects behavior which affects outcome. However, we found that there exist gen...

Economists conducting normative analyses of household financial decisions typically assume specific values of parameters of the household utility function. We review 12 normative analyses and discuss justifications for the personal discount rates assumed. None of the normative articles cited an independent estimate of the personal discount rate. In...

Previous retirement adequacy studies have ignored expected retirement income stages. Ignoring retirement income stages results in biased estimations of retirement adequacy. This study analyzes retirement income stage theoretically and then empirically. Based on the 1995 to 2007 Survey of Consumer Finances (SCF) datasets, about 73% of working househ...

Fang, M.C., Hanna, S.D., & Chatterjee, S. (2013). The impact of immigrant status and racial/ethnic group on differences in responses to a risk aversion measure. Journal of Financial Counseling and Planning, 24(2), 63-76. Factors related to differences in risk aversion were analyzed with a measure of risk aversion inferred from answers to a hypothe...