Define family
The most basic unit of society
Modern family
Breadwinning husband, housewife, and children. Democratic family. Companionate family.
Postmodern family
Families are so diverse. Comparison can not happen.
Traditional/nuclear family
A married couple and their biological child/children.
Family functions
Sense of belonging, emotional security, physical needs, economic needs, socialization
Mitchell's Four Functions of Family - Production
Producing or purchasing food and shelter. Development of employment and consumer skills.
Mitchell's Four Functions of Family - Reproduction
Bearing and raising children
Mitchell's Four Functions of Family - Socialization
Teaching the rules of society
Mitchell's Four Functions of Family - Sexuality
Teaching appropriate, acceptable behaviors
Lamanna & Riedmann Functions of Family. Name the three.
1. Responsible reproduction.
2. Economic support.
3. Emotional security.
Four functions of the family - Relationships
Intimacy, awareness, support
Four functions of the family - Economic
Cooperation, consumption, division of labor
Four functions of the family - Children
Production, rearing, socialization
Four functions of the family - Roles
Identity, status, values and expectations
Love economy
Child care, housework, volunteer work unpaid
Demographic changes with marriage and family in the US
-The median age at first marriage has steadily risen since 1970
-The baby boomer generation's median age for onset of marriage was 23 for men and 21 for women
-In 2011, the median age of onset was 5-6 years later (men: 29, women: 26)
-In the time from 197
Family Systems Theory
When something happens to one family member, all members are affected. Members are part of the group, functioning as a system. Assumes that family actions impact larger social groups they belong to, such as community and nation.
Social Exchange Theory
Family members have individual motivations, members barter personal resources within the family, power bases develop within families based on resources available to exchange and needs of individual members.
Symbolic Interactionism
Looking within families at the process that creates and maintains the family unit. Qualitative and quantitative studies add to this theoretical framework. Families are unique creations. Identities emerge and shared symbols evolve. Impression management. H
Conflict Theory
Theorist argue that conflict is natural and human. There are unequal power bases in families, resulting in competition, coercion, conflict. Humans are driven to want and to seek certain things. Power is at the core of social relationships. Groups have sel
Feminist Theory
Rooted in conflict theory. Emphasis on female experiences. Recognize that women are subordinate or oppressed in existing social arrangements. Commitment to end that subordination.
Family Ecological Theory
Rooted in human ecology. The link between science and environment. No formal set of theoretical propositions, but suggest change and growth occur through experiences with outside systems, new information from the outside brings change to the family relati
Family Strengths Framework
Focus shifts to what is right about a family. Emphasis on what is working well in any family rather than on solving problems. Once strengths are identified, they provide a foundation for growth and change. Six major qualities: commitment to the family, sp
Family Developmental Theory
Solely based in the discipline of family studies. Two major components: time (measured in stages- family stage) and history. The family is a dynamic system. Works well with traditional families. Current diversity of family structures is problematic to thi
Five stages of Maslow's needs
1. Physiological: food, water, warmth, rest
2. Safety: security, safety
3. Belongings and love: intimate relationships, friends
4. Esteem: prestige and feeling of accomplishment
5. Self-actualization: achieving one's full potential, including creative act
Utility
A resource must have a purpose to be useful
Accessibility
A resource must be available for use
Transferablity
A resource must be available where it is needed
Interchangeable
Resources must be exchangeable for other things
Manageable
A resource must be capable of all of the above and useful in the planning process
What is equitable exchange? What are the important components?
Receive something equal to what is given. Fair pricing. Dependent on nature of the interaction and relationship of those involved.
What is the current minimum wage in Michigan?
$9.25
What is the purpose of ALICE?
Asset Limited, Income Constrained, Employed. Survival and stability (savings) budgets. Food, daycare, transportation, healthcare, and housing. Families above the poverty line but struggling to make ends meet.
Define the wage gap and how this is assessed.
Women earn $.78 for $1 earned by males. Gap exists even after accounting for age, education, location, hours worked.
Goal
An end that one tries to attain. Objectives are subsets of goals.
Short-term goal
Generally accomplished in several months. Example: savings for a specific purchase or trip, paying a bill.
Intermediate goal
Less than one year to complete. Example: purchase insurance plan, create an emergency fund.
Long-term goal
One or more years to complete. Example: buying a home, saving for retirement.
Directional plans
Move along a path to completion
Adaptive plans
Flexible to succeed
Contingency plans
Alternate plans
Proactive plans
Avoiding surprises and crises
Reactive plans
Spontaneous without forethought
Strategic plans
Directional, purposeful planning in a proactive way
What is a CD? What is CD Laddering?
Certificate of deposit. Money for a fixed term, principal does not fluctuate. Laddering CDs provides liquidity and has the highest interest levels.
What is a bond?
A certificate representing the purchaser's agreement to lend a business or government money on the promise that the debt will be paid with interest at a specific time.
What is a bond coupon rate?
The annual interest earned on the bond from the bond's issue date until it matures.
What is the FDIC and how does it protect you?
An independent agency of the United States government that protects you against the loss of your insured deposits if an FDIC-insured bank or savings association fails.
Income & Expense/Cash Flow
Income - Expenses = Net Gain or Net Loss
Income: money coming in. Wages/salary, child support, retirement, assistance, other.
Expenses: fixed expenses - usually paid in the same about each time period, often contractual, scheduled payments, difficult to r
Disposable Income
Gross income - Taxes = Net income. Disposable income: at your disposal, used to pay bills.
Discretionary Income
Income - Expenses (fixed/variable) = Net Gain/Loss. Discretionary income: Money to be spent, saved, or invested.
Net Worth/Balance Sheet
Assets - Liabilities = Net Worth
What is owed.
Liabilities: Short-term is less than one year to pay off. Long-term is more than one year to pay off.
What are assets?
Monetary/liquid assets (cash, checking, savings, tax refund): easily converted to cash, maintenance of living expenses, emergencies, savings, payment of bills.
Tangible assets (house/condo/mobile home, appliances, furniture, auto, jewels, tools): contribu
Budget
A plan for how to spend your money; helps you track and accomplish your goals. Paper or electronic. Documentation of planned and actual income and expenditures. Income- gross family income and net income. Expenses- variable and fixed. Typically monthly.
Income
Paycheck deposited in checking account.
Expenses vs. Liability
Fixed expense example: car payment
Variable expense example: cable bill
Short-term liability example: flu shot
Long-term liability example: student loan balance
Flu shot, Dec 1st
Short-term liability
Car payment (paid)
Fixed expense
Signed photo of Mickey Mantle
Tangible asset
Student loan balance (to be paid)
Long-term liability
Cash in wallet
Monetary asset
Cable bill (paid)
Variable expense
Child care payment (paid)
Fixed expense
Paycheck deposited into checking account
Income
$3.80 coffee
Variable expense
Consumers Power bill (unpaid)
Fixed expense
Money left to pay on car loan
Long-term liability
Liquidity ratio
Determines the number of months you could pay off expenses using only monetary assets without income. Monetary assets/monthly expenses
Liquidity
Availability of cash
Asset to Debt Ratio
Do i have enough assets to meet my debt obligations? Ability to pay off debts.
Total assets/total debts
Debt service to income ratio
Is my total debt burden too high? Ratio should decrease as you get older. Ratio of .36 or less is good.
Annual Debt Repayments/Gross income
Debt payment to disposable income
Is my non-mortgage debt too high? Ratio of .14 or less.
Monthly non-mortgage payments/monthly disposable income
Open-ended (revolving credit)
Credit extended in advance. Borrow up to your limit.
Secured credit
secured by collateral, if delinquent asset is taken
Closed-ended (installment credit)
Repay amount plus interest, number of equal payments
Unsecured credit
No collateral. If delinquent, may go to court.
Three credit bureaus and their function
Equifax, transunion, experian. Report personal information, credit status, inquiries. Each using different scoring models. Some creditors/lenders do not report to all 3 bureaus.
What percentage of payment history does FICO examine to determine your credit score?
35%
What percentage of amounts owed does FICO examine to determine your credit score?
30%
What percentage of credit history does FICO examine to determine your credit score?
15%
What percentage of types of credit does FICO examine to determine your credit score?
10%
What percentage of more debt does FICO examine to determine your credit score?
10%
Savings vs. Investing
Savings: safe, good for short-term, easy accessible (liquid), low return
Investing: potential for appreciation, intermediate and long-term, volatile for short periods, involves risk
Time Value of Money
The longer you save or invest, the more money you will accumulate. The more money you save or invest, the more it will accumulate because of the magic of compound interest. Principle. Interest. Time.
Compound Interest
The more frequent the interest is compounded, the higher the yield.