Sharon A. DeVaney

Household insolvency: A review of household debt repayment, delinquency, and bankruptcy

Abstract This review paper explores the issues related to the meaning and measurement of insolvency within the domain of household finances. Conceptual and empirical evidence to explain the onset of insolvency is reviewed. Predictive models and financial ratios are presented as techniques for identifying insolvent households. Implications for monitoring of solvency by households and responses to insolvency are presented.

Predicting Business Failure of Retail Firms: An Analysis Using Mixed Industry Models

Abstract The retail industry is very important to the economy but highly vulnerable to business failure. Identification of an accurate failure prediction model would benefit management and investors in retail firms. Models have been developed over the last 30 years that had failure prediction as their goal. Financial ratios and cash flow information were used as variables in the development of these models. This study applies five previously developed failure prediction models to financial information of a recent 5-year period for a matched sample of 56 failed and 56 nonfailed retail companies. The models applied in this study all use mixed industry samples in their development. The classification accuracy of the mixed industry models decreases when they are applied to a sample of only retail firms. It is suggested that future failure prediction studies use single industry samples to enhance their predictive accuracy.

Assessing the Baby Boomers' Financial Wellness Using Financial Ratios and a Subjective Measure

The purpose of the study was to examine the financial wellness of the baby boomers using two definitions of financial wellness: objective and subjective financial wellness. With data on 2,021 baby boomer households from the 2001 Survey of Consumer Finances, the study examined factors related to three measures of objective wellness and one measure of subjective wellness. The results showed that 20% met the guideline for liquid assets-to-income, 74% met the guideline for debt-to-assets, 62% met the guideline for investment assets-to-net worth, and 64% said that compared to others of their generation and background, they were lucky in their financial affairs. The results help consumer educators and financial advisors understand which factors should be emphasized when providing information to baby boomers.

Older Americans' Dining Out Preferences

ABSTRACT Continuing growth of the older population segment has forced restaurants to prepare for dynamic social changes in the U.S. As the number of older Americans increases, physical and psychological changes associated with aging impact their dining out behavior. A survey of 407 Americans aged 55 and over was conducted in August 2001 in Indiana to determine how older Americans make eating out decisions. Results of this study suggest that older Americans are more likely to dine out for socialization than convenience. This paper provides useful information for restaurants to understand the growing older market and to make marketing plans.

A retail failure prediction model

Financial ratios have long been used for business analysis. Researchers have formulated business failure prediction models utilizing financial ratios. This study focuses on the use of financial ratios to discriminate between failed and non-failed firms in the retail industry. Using a matched sample of sixty-six failed and sixty-six non-failed retail firms obtained from the COMPUSTAT database, multiple discriminant analysis was utilized to develop a retail prediction model which accurately classified 78 per cent of the sample firms as failed or non-failed. Hotellings T 2 test determined that the mean vector of the discriminant function for failed firms differed from that of non-failed firms. The model was further validated using a jackknife procedure and split sample analysis. Failed or non-failed classification accuracy was found to be significantly better than chance.

The Expectation of Partial Retirement Among Family Business Owners

Decisions that the family business owner makes about retirement and succession are critical and could affect a large proportion of the work force. Compared to employees, family business owners may have more of an opportunity to retire partially, i.e., reduce the number of hours worked. The purpose of this study was to determine the characteristics of family business owners who expect to retire partially. Data on 1,155 family business owners from the 1998 Survey of Consumer Finances reveals that family business owners with more education and more income, who work more hours per week, and who have tax-deferred retirement accounts expect to retire partially. There is a direct correlation between age and those choosing partial retirement, suggesting that many family business owners expect to retire partially. Married family business owners were less likely to expect to retire partially; instead, they would retire fully. The equity in the business, type of ownership, and involvement of other family members did not affect the expectation of partial retirement.

Using a Computer Simulation Game to Teach Family Time Use Concepts

A computer simulation game designed to give students insights into family time use concepts has been used in an introductory family resource management class at Ohio State University and other universities. The game allows for planning for time use changes over the family life cycle. The game can give students insights into economic and sociological models of time use. It is possible that future versions of the game could be used in family counseling.