Written By: Peng Chen and Michael Finke
Characteristics of families with a negative net worth are explored using data from the 1992 Survey of Consumer Finances. Life cycle theory is applied to predict which households choose to go into negative net worth. Logit analysis showed that well educated young households who might expect increasing incomes are more likely to have a negative net worth. KEY WORDS: life cycle hypothesis, net worth, Survey of Consumer Finances.
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