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National Longitudinal Survey of Older and Young Men (NLSM)

Income and Assets

Both the Older Men and Young Men cohorts have been asked numerous questions about their income, assets, and debts over the course of the surveys. While many researchers use income as the primary measure of the economic resources available to a respondent, users can draw a more complete picture of economic well-being by examining both income and wealth. Wealth, which is equal to a respondent's assets minus his debts, reflects the total financial resources available to the respondent.

Income

In every survey year, respondents were asked about their pretax income. Tables 1 and 2 present the broad range of income questions asked since 1966, including wages, business and farm income, rental income, interest and dividends, and public assistance support sources. In addition to the in-depth questions about the income of the respondent and his spouse, respondents also provided their estimate for total income of all individuals in the family in some years, while in other years they were asked to estimate the total income of all individuals except their wives and themselves. Finally, respondents have been asked in select years about their ability to get along on their family's income, with choices ranging from "always have money left over" to "can't make ends meet."

User note about fielding of income variables

Researchers should be aware that, in years when the entire survey was shortened, some income sources were dropped altogether; in years when a more in-depth survey was used, the questions were reinserted. Additionally, users should pay careful attention to the wording of income questions to determine exactly whose income is included. In early survey years for the Older Men cohort, respondents were asked about the combined income of themselves and their wives; in later years, Older Men respondents were asked separate questions on how much income they and their wives received from the various sources. In most surveys, Young Men respondents were asked separately about the income of themselves and their wives. However, in the 1973 and 1975 interviews, Young Men respondents were only asked about their own income; there were no questions regarding spouses.

Table 1. Older Men income questions

Question Note 1.1

 66 67 68 69 71 73 75 76 78 80 81 83 90
Wage & salary * *   * * * * * * * * * *
Business income * *   * * * * * * * * * *
Farm income * *   * * * * * * * * * *
Interest, dividends * *   * * * * * * * * * *
Rental income * *   * *     *     *   *
Social Security * *   * * * * * * * * * *
Pension income * *   * * * * * * * * * *
Unemployment Compensation * *   * *     *     * * *
Workers' Compensation * *   * *     *     *    
Disability income * *   * *     *     *   *
Welfare (AFDC) * *   * * * * * * * * * *
Food Stamps * *   * *     * * * * * *
Other income * *   * * * * * * * * * *
Assistance from relatives                     * * *
Total family income     *   * * *           *
Ability to get along on income                 * * * * *

Note 1.1: All income categories are not asked as separate questions in all years; categories were most often combined in telephone surveys.
Table 2. Young Men income questions

Question Note 2.1

 66 67 68 69 70 71 73 75 76 78 80 81
Wage & salary * * * * * * * * * * * *
Business income * * * * * * * * * * * *
Farm income                       *
Interest, dividends * * * * * * * * * * * *
SSI                 *     *
Unemployment Compensation * * * * * * * * * * * *
Workers' Compensation                       *
Disability income                       *
Welfare (AFDC) * * * * * * * * * * * *
Food Stamps               * * * * *
Inheritance, gifts, prizes                 *      
Assistance from relatives                   * *  
Total family income * * * * * * * * * * * *
Ability to get along on income                   * * *

Note 2.1: All income categories are not asked as separate questions in all years; categories were most often combined in telephone surveys.

Assets

Respondents have periodically been asked a full set of asset and liability questions. Tables 3 and 4 depict the questions pertaining to assets by survey year; note that 1968 mail survey of Older Men and all telephone surveys are omitted from the table because no asset questions were asked in those surveys. When respondents were asked the full selection of questions, they provided information on the value and mortgage of their home, cash assets, business and farm activity, vehicles, and other debts. In several years, respondents were also asked to rate their overall financial position as better, worse, or about the same as the previous year.

Table 3. Older Men asset questions

Question

 66 69 71 76 81 90
Own home/apartment * * * * * *
Market value of property * * * * * *
Amount owed on property * * * * * *
Have estate/trust           *
Amount estate/trust           *
Have money assets * * * * * *
Amount of money assets * * * * * *
Have savings bonds * * * * * *
Amount of savings bonds * * * * * *
Have stocks/bonds * * * * * *
Value of stocks/bonds * * * * * *
Have IRA/Keogh/401k/life insurance           *
Amount IRA/Keogh/401k/life insurance           *
People owe you money * * * * * *
Amount owed to you * * * * * *
Own farm/business/real estate * * * * * *
Market value farm/business/real estate * * * * * *
Amount debts farm/business/real estate * * * * * *
Own vehicles * * * * * *
Owe any money on vehicles *   * * * *
Amount owe on vehicles *   * * * *
Market value of vehicles     * * * *
Make/model/year of vehicles * * *      
Owe money to creditors * * * * * *
Amount owed to creditors * * * * * *
Received inheritance/life insurance       * *  
Better/worse financially   * * *   *
Table 4. Young Men asset questions

Question

 66 67 68 69 70 71 76 81
Own home/apartment *       * * * *
Market value of property *       * * * *
Amount owed on property *       * * * *
Have money assets *       * * * *
Amount of money assets *       * * * *
Have savings bonds *       * * * *
Amount of savings bonds *       * * * *
Have stocks/bonds *       * * * *
Value of stocks/bonds *       * * * *
People owe you money               *
Amount owed to you               *
Own farm/business/real estate         * * * *
Market value farm/business/real estate         * * * *
Amount debts farm/business/real estate         * * * *
Own vehicles *       * * * *
Owe any money on vehicles *       * * *  
Amount owe on vehicles *       * * *  
Market value of vehicles         * * *  
Make/model/year of vehicles *       * *    
Owe money to creditors *       * * * *
Amount owed to creditors *       * * * *
Better/worse financially   * * * * *    

User note: Multiple respondent households

A number of respondents have wives or parents/children in the other NLS Original Cohorts. If the respondent is part of a multiple respondent household, researchers may be able to compare the respondent's income and asset information with that provided by other members of his family. (For more information on the possible linkages, users should refer to the "Household Composition" section.) Using the husband-wife pairs may provide a more complete picture of a respondent's available resources, while the parent-child pairs provide researchers with information on how income and assets are propagated across generations.

Topcoding

To ensure respondent confidentiality, income variables exceeding particular limits were truncated each survey year so that values exceeding the upper limits were converted to a set maximum value. These upper limits varied by year, as did the set maximum values. From 1966 through 1980, upper limit amounts for both men's cohorts were set to maximum values of $50,000. For the 1981 surveys and 1983 Older Men interview, the maximum value was set to $50,001 so that researchers could distinguish between topcoded individuals and those reporting $50,000. In the 1990 Older Men survey income amounts exceeding $100,000 were converted to a set maximum value of $100,001.

Asset values were also topcoded. Beginning with the first surveys in 1966, asset variables exceeding upper limits were truncated to $999,999. Beginning in 1976, assets exceeding one million were converted to a set maximum value of $999,994. In 1981 the maximum was increased by three dollars to $999,997. For the 1990 Older Men survey, the Census Bureau topcoded selected asset items if it considered that release of the absolute value might aid in the identification of a respondent. This topcoding was conducted on a case-by-case basis, with the mean of the top three values substituted for each respondent who reported such amounts.

Nonresponse

One major concern when asking individuals about their income and wealth is nonresponse bias. While it is outside the scope of this chapter to fully investigate nonresponse bias, this section briefly describes nonresponse in the 1981 survey of both cohorts as an example of the issues raised. There are two primary types of questions on income and assets (or debts): general questions asking whether the respondent received income from a particular source or owned a particular asset, and specific questions asking about the amount of income or the value of the asset. Factors that are likely to contribute to nonresponse are suspicion, uncertainty, shared responsibility for family finances, and complex financial arrangements. The 1981 survey is examined because it was the last year in which both men's cohorts were interviewed.

Tables 5-8 provide information on response rates to questions on income and wealth in the 1981 surveys. Respondents who refused to answer, who responded with "don't know," or who are invalid skips are all counted as nonresponses. Both cohorts had high response rates on the receipt and ownership questions--generally around 99 percent. The percentages in the amount column are based only on individuals who reported receiving that type of income or having that type of asset or debt. These amount questions show much lower response rates. For example, business and farm income drops by 20 percent for the Older Men and 13 percent for the Young Men. Note: The universe for Tables 5-8 is restricted to individuals who received income from the relevant source or had the relevant asset or debt.

Tables 5 and 6 are based on R05054., R05059.-R05069., R05072-R05077., R05210.-R05214., R05217., R05218., R05223., R05236., R05237., R05244., R05245., R05268., R05269, R05283.-R05296., R05300., R05301., R05306., and R05307.

Table 5. Response rates to 1981 Older Men income questions

Income Category

 Receive Income from Source Amount
Wages/salaries -- 95.9%
Business 99.5% 79.8%
Interest/dividends 99.5% 69.8%
Social Security 99.6% 84.5%
Retirement pensions:

Private employer

 99.5% 91.4%

Military

 99.3% 93.3%

Federal Government

 99.4% 92.4%

State Government

 99.4% 79.7%

Local Government

 98.5% 85.5%

Union

 99.4% 86.6%

Other pension

 99.2% 78.3%
Table 6. Response rates to 1981 Older Men asset questions

Asset/Debt Category

 Own Asset/Have Debt Amount
Money assets 99.6% 74.2%
Securities 99.4% 69.1%
Farm 99.7% 76.7%
Investment property 99.8% 88.3%
Business 99.8% 71.2%
Vehicles 99.7% 91.4%
Primary residence 99.9% 90.7%
Mortgage debt -- 95.1%
Vehicle debt 99.4% 89.4%

Table 7 and 8 are based on R07815., R07819.-R07823., R07826., R07827., R07833.-R07838., R07841., R07842., R07847.-R07851., R07856.-R07861., and R07882.-R07885.

Table 7. Response rates to 1981 Young Men income questions

Income Category

 Receive Income from Source Amount
Wages/salaries/tips --- 94.9%
Business income 99.1% 87.1%
Unemployment benefits 99.0% 97.8%
Veterans Comp/pension 99.6% 94.7%
Workers' Compensation 99.5% 98.0%
Rental income 96.7% 85.9%
Social Security Disability 99.6% 95.2%
Farm income 99.6% 86.9%
Table 8. Response rates to 1981 Young Men asset questions

Asset/Debt Category

 Own Asset/Have Debt Amount
Money assets 99.2% 87.5%
Securities 99.5% 81.5%
Savings bonds 99.6% 86.8%
Farm 99.8% 89.5%
Business 99.8% 85.2%
Primary residence 99.8% 96.3%
Mortgage debt -- 86.7%
Other debt 99.6% 95.4%

Created variables and summary statistics

Survey staff have created a small number of summary income and asset variables for both men's cohorts. The standard variable is 'Total Family Income' or 'Total Net Income of Family.' This variable is created by adding up all of the individual's income categories. Should any of the categories be unavailable, the created variable for that year is labeled "not available." A small number of cases each year have negative income; these individuals have business expenses that are larger than their business and other income. This variable is available in the following survey years:

  • Older Men: 1966-69, 1971, 1976, 1981, 1990
  • Young Men: 1966-71, 1976, 1978, 1980, 1981

The data sets also include a standard summary variable for wealth entitled 'Total Family Assets' or 'Total Net Family Assets.' This variable was created by adding up the individual's housing, savings, bond, IRA, insurance, and business assets and then subtracting mortgages, loans, and other debts. Users are cautioned that a number of respondents have negative net family assets. These variables are present for the following surveys:

  • Older Men: 1966, 1969, 1971, 1976, 1981, 1990
  • Young Men: 1966, 1970, 1971, 1976, 1981

User note: Vehicle market value

Market value of vehicles was not asked consistently of either cohort. In the years in which these data were collected, automobile wealth was included in the total family assets variable. Researchers should keep this variation in mind when comparing data across interviews.

Additionally, users are cautioned that the 1971 and 1976 Young Men data include two different types of total family asset variables--one set that includes vehicle value and one that excludes it. These variables were created so that users could match the total net asset values from earlier survey years, when automobile wealth was not included in the survey.

Survey Instruments Each year's questionnaire has a section on "Income" or "Assets & Income" where the variables described above are located.