赵丽华

Abstract：Each family and individual has many choices to make in getting and using income. However, there are always similarities and common circumstances for each financial unit. This article presents basic facts and principlesand methods of analysis that are available to families and individuals in their persona-l life.

Keywords：Financing; Decision; Budget;Operate

中图分类号： G642文献标识码: A文章编号：1672-1578（2009)5-0018-03

Each family and individual has many choices to make in getting and using income. Only the consumer unit can make the decisions that are most appropriate for it. Family welfare requires, therefore, an understanding of financial problems that may arise during the life cycle, decisions to be made, and alternatives available.Changes in socioeconomic conditions, in the stage of family life cycle, and in the singular needs and resources of individuals provide an endless procession of financial experiences. Each family has a unique array of concurrent experiences. The tremendous variety of ways of obtaining income and of spending, saving, and sharing it has greatly increased the number of decisions to be made and the complications in making them. Many Americans leave us the impression that they are always enjoying their life and spending their money as much as they want. It seems that Americans don't make financing plans as carefully as we Chinese. However, this is not always the truth. This paper makes a research on American personal financing. It gives us an understanding of how Americans manage their money.

1 The expenditures of American families

1.1Prevailing problems of the Americans

1.1.1The problems are prevailing both with the poor and the rich

Today many of the Americans feel that they have budget problems because prices and taxes are too high and incomes are not high enough, that is, high enough for them to procure all of the desirable goods and services attractively advertised and displayed on the market. Frequently they think that getting more income would be a simple solution to these problems. In many cases it would help. But there are indications that more dollars are not a cure-all. For they have discovered that the family with an unemployed father or a child requiring expensive medical care thats the poor is aware of its acute budget problems. But the average family also finds that it has to manage carefully in order to supply its needs, providing a college education for the children sometimes strains the budget even with of a family with a higher income. Even family in the top tenth income group report budget problemswhich is big problem worth noting.

1.1.2The reasons why they have budget problems

One must realize that some families are caught in circumstances that require high amounts of dollar income to provided basic necessities. There may be an unusually large number of members in the home to be supported the family may have large, necessary medical expenses or other uninsured losses to meet; it may have to contribute to the support of relatives outside the home 0r the family may live in a community. But the reasons may also be connected with the family's ideas of its necessary level of living desires for goods and services may increase as fast as or even faster than income does. At any rate, it seems clear that budgeting problems are not eliminated by a higher income. In certain respects they increase, since a wider range of choice is opened, requiring broader consideration and knowledge. Now we need a more through research over the family's income and their budget plan to carry on our research. In addition to current income, a family may have other money resources for family support. It may use credit for the purchase of goods and services, that is, draw on future income, as many young families do. On the other hand, it may draw on its accumulation of savings, using up its principal, as many elderly persons do.

1.2The familys income

Goods and services for family support may be obtained directly or through the use of money res-ources, that's the family's income, which can be divided into money resources and nonmoney resources. Current income is the most important source of money for family support. It includes earnings for services in wages, salary, commission, or bonus, as well as net income from self-employment in a private profession or business, no farm or farm. It also includes investment income in the form of interest from savings accounts and similar items. These are generally termed "transfer” income, that is, transferred from one person or group to another. Almost half of all families have currently earned income only. At low-income levels, a sizable proportion of the families have no current earnings. At middle-income levels, the majority has current earnings only. But at high-income levels, the majority has both current earnings and other income. Somewhat less receive other types of income in addition to current earnings, and a few have no earnings at all. In addition to current income, a family may have other money resources for family support. It may use credit for the purchase of goods and services, that is, draw on future income,. On the other hand, it may draw on its accumulation of savings, using up its principal, as many elderly persons do. Many families have additional goods and services for which they do not pay out of current mo-ney resources. Sometimes these constitute large addition to real income. The family may receive goods and service as gifts, charity, pay, or prizes, Gifts from individuals and organizations include everything from baby-sitting service by a friend to surplus foods distributed by the government. Farm labors and ministers are among the groups that frequently receive housing as part of their pay. The family may home-produce many items for its own use. the family may service many of the repairs around its own home, which would be exceedingly expensive if purchased privately.

1.3Budgeting process

The familys determination of its general financial objectives places detailed financial decisions in proper perspective. The process involves, first, creation of a comprehensive long-range financial plan; second, determination of specific budget goals; third, construction of the budget. Here we are going to talk about the financial plan; financial goals of their budget and the construction of the budget.

1.3.1The financial plan

The familys' financial plan includes general plans and expectations through a family's life cycle for raising a family, educating the children, and obtaining income through choice of occupation and number of earners. It also involves plans for the familys way of living, saving and investments, and contributions to others. Their plans involve their division of their time. The family decides first, what part of its time should be devoted to work that will produce income for the support of the family and what part shall be kept as nonworking time. Nonworking time may be devoted entirely into personal activities and recreation, or it may be used for personal development, religious service, and community service. In his appointment of time between working and nonworking hours, in occupational choice, in free time activities, and in allocation of his income, an individual can express his interests. Thereby he becomes clear that what his primary interest and what his secondary interest is. Primary interests are found everywhere in every culture and are always strong. They include the sensory interest on the satisfaction of the needs of hunger, thirst, warmth, exercise and sex. They keep us alive as individuals and as a genus. The secondary are found in different strength in different cultures, including intellectual interest, aesthetic interest, and empathetic interest. A combination of interests may be expressed in a given use of a familys' economic resources. For instance, dinner served to a group satisfies hunger and provides companionship. The technological interest may be expressed in the use of modern equipment to prepare the meal. The beauty of the table service and the dinning area may give aesthetic satisfactions. Provision of dinner for foreign students may be an expression of the empathetic interest. The conversation may be on intellectual interests.

1.3.2Financial goals of the budget

In contrast with the familys' long range, general plan, the budget is a relatively definite plan for the use of expected income in the next period to support known dependents, and for saving and sharing. First they seek to provide for daily necessities--food, clothing, and shelter. They also seek the costs of unexpected emergencies, such as repairs, illness, death, loss of poverty and liabilities for damages inflicted by family members on the persons and property of others. In addition, they probably want to provide for some daily comforts and luxuries, above the necessity level. Then it may seek to provide for large expenditures, which it anticipates, with pleasure, such as education and furniture.

1.3.3Construction of the budget

The first step in constructing the budget is to estimate income for the next period, probably a year, from all sources and all earners. The second step is to list deductions from income that required of a worker and citizen. These include involuntary taxes, job expenses, and premiums for insure required by the job. The third step is to list the family's contractual obligations for the next period. These include other taxes, debt repayment, and other insurances. The last step is to plan the use of the remaining, unobligated income in each period.

2 How to budget

As we know American families spend their incomes for a great variety of goods and services—large or small. In this part we will make a research on their budgets to know how Americans plan to spend their money. First we should know that their budget mainly includes food budget, clothing budget, shelter budget automobile budget, medical budget, and some other expenditure.

2.1Food budgeting

The food budget deserves first consideration since it is by far the most important category in the family budget, taking 18percent of disposable income.The primary goal of a good plan is a nutritionally adequate diet—vitamin bills and medicals and dental bills are expensive substitutes. Food must regularly supply needed amounts of proteins, minerals, fats, and carbohydrates. This includes meat group, milk group, vegetable-fruit group and bread-cereal group and so on. The family may plan to use low-cost sources of nutrients. This may be done by emphasizing the low-cost food groups--dry beans, peas, and nuts; flour, cereal, and baked goods; and potatoes. The high-cost sources of nutrients are: ice cream; fancy cheeses; rib lamb chops, porterhouse or sirloin steak, lion pork chops; nuts; fancy baked goods, snack foods; potatoes chips; fresh fruits and vegetables, out of season, such as tomatoes, asparagus, melons; pickles, catsup and chili sauce, olives; butter, salad dressings; candy, jellies and jams, prepared desserts; coffee, tea soft drinks.

2.2Clothing budgeting

While incomes have been rising, the quantity of clothing purchased per person has increased little in contrast with other important categories in the budget. This lessened emphasis on clothing is related to the trend to casual clothing, the decline in the use of clothing for prestige, the greater durability of some modern fibers,.The major step in management of the clothing budget is to buy wisely according to the plan. This involves knowing what is wanted, shopping around for it, and avoiding impulse items that neither do nor fit into the plan. There are also safety and quality to think about. A major safety problem in clothing and fabrics is flammability. A wise buyer will be constantly alert for this hazard. The flammability of fabrics used in clothing as well as in curtains, drapes, upholstery, carpets, and bedding needs to be considered particularly when the items are used by invalids, children, the elderly and the careless person. Cleanliness and destruction of bacteria in the fabrics are necessary for personal hygiene and the prevention of growth of disease organisms. All garments should be fitted properly for comfort and avoidance of irritation. Judging the quality of garments is a major job at the time of purchase. Research studies indicates that the quantities most wanted in garment are good style, color, fit durability, comfort, performance in use, and ease of care. Indication of these qualities on the market is the special problem of consumer-buyer who has to depend primarily on inspection and informative labels.

2.3Shelter budgeting

The shelter budget is of great importance because of its relation to family living conditions as well as the large outlay it involves. To determine how much it can and should pay for shelter each month, the family should first take into account its expected income. Then it considers: its necessary expenses and debts for all items other than shelter; its need for insurance and savings; its shelter needs and the cost of meeting them. There are some special cost considerations we should count in selecting a dwelling. The location of the dwelling may affect importantly certain expenses of the family. Transportation costs are frequently much higher for those outside the central city. Seeking a community with low taxes is not always economical in the long run since the taxes are used to support schools and the services of the local government. Good housing construction and facilities minimize expenses for repairs, for property insurance, and for cooling, heating, watering supply, hot water, and disposal of household wastes.

2.4Auto budgeting

Transportation takes 12 percent of disposable income of todays consumers- almost as much as shelter and decidedly more than clothing. The amount of transportation services per person is now about 2.5 times what is in 1929. How to budget automobile is another problem for them. Facing the costliness of operating autos is difficult for Americans. Somehow we feel protective toward the auto and hide its cost. If a young couple keeps a careful record, they will find that it spends almost equal amounts on food, apartment rent and utilities, and its auto.Here are some wrong ways in peoples mind as to when to have a new car. You can check yourself from them. Some families consider that they need a new car every year or two principally because of styles changes. Other families like to have a new car frequently because of mechanical improvements or the greater dependability of a new car. These families usually find that their new cars have defects ranging from small leaks to inoperative brakes, which may not be corrected perfectly, quickly, without inconvenience or without additional expense.

2.5Medical care budgeting

American medical care takes only 6 percent of disposable income of consumers. Each family member can work directly to cut medical needs by the development of good health practices and by care to prevent accidents at home, on the streets and on the job. In fact, in addition to efforts to minimize the need for medical care, the family must prepare ahead of time for the cost of any needs that develop. It may build savings in cash or other forms on which to draw in case of need. Such savings are generally most appropriate for the ordinary, predictable costs. Optimism, ignorance, indifference, and inability cause many families to make insufficient financial preparation ahead of the time of need for medical care. In an emergency, they use current earnings by cutting expenses or their savings program. So, they need to develop considered attitudes toward extremes in medical care.

2.6Other expenditures

A third of disposable income of consumer goes for the remaining categories of expenditure, although they are relatively small individually. More than half of this total amount is spent on furnishings and equipment, household operations(such as the telephone bills), utilities and recreation(television or radio). The remaining categories of expenditure only take up a small proportion, including 3 percent for alcoholic beverages, 2percent for tobacco, 2 percent for personal care, 1 percent for private education, 1percent for religious activities, 1 percent for reading, 5 percent for other items.

3 Family Savings

3.1Family savings current state

3.1.1Current state

studies of family expenditure patterns indicate that the proportion of income saved varies considerably with family characteristics. In other words, savings are made when the family is under lessened pressure to spend and increased pressure to save.

3.1.2Elements to affect it

Americans savings are always affected by the following factors. First, when and how much a family should save is determined by its own personal situation. Current income must first cover current needs. Second, how much a family should save is also determined by its valuation of its future needs and of resources that will be available for meeting them. Third, how seriously it values each of these future needs affects importantly how heavily it will weigh current expenditures.

（1）Checking accounts.Checking accounts are the most important liquid form of asset other than cash. Six-tenth of all consumers units has checking accounts, and the proportion increases with amount of them. A checking account makes it possible for a family to transfer funds by drawing a personal check, which greatly simplifies payment, provides receipts, and diminishes the necessity for carrying large sums of cash. （2）Saving accounts.Almost 4 out of 10 consumers units have savings accounts at commercial banks. Consumers hold 3% of their total wealth in such account. Therere different types of them.1by stock holders2at mutual saving banks.3in a savings and loan or building association 4.with credit union share. （3）Saving bonds .A quarter of consumer units own some U.S saving bounds, and 2% of consumer wealth is invested in them. Consumers hold almost $50 billion worth of these bonds today. 4 Conclusion

This is a paper on American society and culture. I choose that angel of personal finance, which would be a help for foreign students to understand American management of their money.

From this paper, we can see Americans don't live a life as luxuriously as we think. They are also faced with financing problems and will make plans. They do this in case of emergency or for their future life.

Bibliography：

[1]Herman P.Miller.Lifetime Income and Economic Growth[J]. American Economic Review, September，1965.