HOUSEHOLD INTERNATIONAL INC, DEF 14A, 1995-03-29

HOUSEHOLD INTERNATIONAL INC
DEF 14A, 1995-03-29
PERSONAL CREDIT INSTITUTIONS

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<PAGE> 1

SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934

Filed by the registrant /X/

Filed by a party other than the registrant / /

Check the appropriate box:

/ / Preliminary proxy statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))

/X/ Definitive proxy statement

/ / Definitive additional materials

/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
HOUSEHOLD INTERNATIONAL, INC.
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(Name of Registrant as Specified in Its Charter)
HOUSEHOLD INTERNATIONAL, INC.
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of filing fee (Check the appropriate box):

/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.

/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).

/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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/ / Fee paid previously with preliminary materials.

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/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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<PAGE> 2

[Household Letterhead]

[COPY WHITE]

March 31, 1995

Dear Stockholder:

The directors and officers of Household International, Inc., cordially invite
you to attend the Annual Meeting of Stockholders which will be held at
Household's corporate headquarters in Prospect Heights, Illinois, on Wednesday,
May 10, 1995, at 9:30 a.m. As we have done in the past, we will report on the
progress and prospects of Household while providing you with an opportunity to
ask questions about your company.

At this meeting you will be able to elect your new Board of Directors for the
upcoming year and you will be asked to approve an Employee Stock Purchase Plan
for Household employees. This stock purchase plan is one of the ways we promote
a strong alliance between Household employees and our stockholders. As owners of
Household, we expect all of our employees to act in the best interests of its
stockholders in every decision they make. Lastly, you will vote on whether to
ratify the appointment of Arthur Andersen LLP as our independent auditors for
1995.

This past year we have added several new individuals to your board. This
action was taken to provide for a smooth transition of the leadership of
Household as certain directors will be retiring over the next two years as a
result of attaining Household's mandatory retirement age for directors. Please
take the time to meet William F. Aldinger, our President and Chief Executive
Officer, John A. Edwardson, President of UAL Corporation and United Airlines,
Inc., George A. Lorch, Chairman and Chief Executive Officer of Armstrong World
Industries, Inc., James B. Pitblado, former Chairman of RBC Dominion Securities,
Inc., and S. Jay Stewart, Chairman and Chief Executive Officer of Morton
International Inc., each of whom will be attending their first Household annual
meeting and are standing for election to Household's Board. These individuals
bring to your Board of Directors a broad range of experience and demonstrated
leadership capabilities. Their personal and professional accomplishments are
exemplary.
<PAGE> 3

We feel it is important that as many stockholders as possible be represented
at the meeting as this is your meeting, your opportunity to meet management and
the Board of Directors and to discuss the direction of your company. Last year,
stockholders holding over 88 percent of the outstanding shares entitled to vote
either voted in person or by proxy at the annual meeting. We appreciate this
interest of our stockholders in the affairs of Household and hope that those
entitled to vote at this annual meeting will again take the time to do so.
Consequently, regardless of whether you now expect to be personally present at
the meeting, please complete, date and sign the enclosed proxy card and return
it promptly.

Again, please consider joining us for the 1995 Annual Meeting of Stockholders.
We look forward to visiting with you.

Sincerely,

<TABLE>
<S> <C>
[SIG] [SIG]
WILLIAM F. ALDINGER DONALD C. CLARK
President and Chairman of the Board
Chief Executive Officer
</TABLE>
<PAGE> 4

[Household Letterhead]

NOTICE OF 1995 ANNUAL MEETING OF STOCKHOLDERS
March 31, 1995
To the Stockholders of HOUSEHOLD INTERNATIONAL, INC.:

Notice is hereby given that the Annual Meeting of Stockholders of Household
International, Inc. ("Household") will be held at Household's headquarters at
2700 Sanders Road, Prospect Heights, Illinois 60070, on Wednesday, May 10, 1995,
at 9:30 a.m. for the purpose of (1) electing directors, (2) approving the
Household International Employee Stock Purchase Plan, (3) ratifying the
appointment of Arthur Andersen LLP as the independent auditors for Household,
and (4) transacting any other business which may properly come before the
meeting. Stockholders entitled to notice of and to vote at the meeting are the
holders of record of Household's common stock, par value $1.00 per share
("Common Stock") and of its $6.25 Cumulative Convertible Voting Preferred Stock
("$6.25 Preferred Stock"), all as of the close of business on March 15, 1995.

YOUR VOTE IS IMPORTANT TO HOUSEHOLD. IF YOU DO NOT EXPECT TO VOTE IN PERSON AT
THE ANNUAL MEETING, WE URGE YOU TO SIGN AND DATE THE ENCLOSED PROXY AND RETURN
IT PROMPTLY IN THE ENVELOPE PROVIDED. The giving of such proxy will not affect
your right to vote in person if you attend the meeting.

By Order of the Board of
Directors,
[Sig.]

JOHN W. BLENKE
Assistant General Counsel
and Secretary
<PAGE> 5

[MAP]

Household's headquarters is located on Sanders Road in Prospect Heights,
Illinois, approximately 25 miles northwest of downtown Chicago. Stockholders
attending the meeting who will be using the Tri-State Tollway (Interstate Route
294) should exit at Willow Road, travel west on Willow Road to Sanders Road, and
turn left at Sanders Road. Household's corporate headquarters is not served by
public transportation.

Parking facilities will be available for all those attending, and refreshments
will be served beginning at 9:00 a.m.

2
<PAGE> 6

[Household Letterhead]

PROXY STATEMENT

Your proxy for the Annual Meeting of Stockholders is solicited by Household's
Board of Directors. It is revocable by you prior to exercise by written
revocation, execution of a later dated proxy, or voting in person at the
meeting. This proxy statement and proxy are being mailed to stockholders on or
about March 31, 1995.

The close of business on March 15, 1995, has been fixed by the Board of
Directors as the record date for determination of stockholders entitled to vote
at the meeting. As of the close of business on that date, the number of
outstanding shares of Household stock entitled to vote at the meeting are as
follows: 96,909,414 shares of Common Stock (not including 18,215,872 shares of
Common Stock held in treasury), and 47,904 shares of $6.25 Preferred Stock (not
including 1,887,295 shares of $6.25 Preferred Stock held in treasury). Each
share of Common Stock and $6.25 Preferred Stock is entitled to one vote;
however, shares of Common Stock and $6.25 Preferred Stock which Household holds
in treasury cannot be voted.

Shares represented by all properly executed proxies will be voted as specified
by you; however, if no such specification is made, the shares will be voted
"FOR" each of the listed nominees to the Board of Directors, "FOR" the approval
of the Household International Employee Stock Purchase Plan and "FOR" the
ratification of the appointment of Arthur Andersen LLP as the independent
auditors for Household. In determining whether shares are present and a quorum
exists at the Annual Meeting of Stockholders for purposes of all matters to be
voted on, abstentions and "broker non-votes", i.e., shares which are represented
by proxies at the meeting for which authority to vote on any particular matter
is withheld, will be present. The affirmative vote by a majority of the quorum
will be required for the election of Household's fourteen directors and to
ratify Arthur Andersen LLP as the independent auditors for Household. The vote
of the holders of a majority of the outstanding shares present at the meeting
and entitled to vote shall be required for the approval of the Household
International Employee Stock Purchase Plan. With respect to the election of
directors and the ratification of Arthur Andersen LLP, abstentions and broker
non-votes will have the same effect as a vote against. With respect to the
approval of the Household International Employee Stock Purchase Plan,
abstentions will have the effect of a vote against such approval but broker
non-votes will not.

If you are a participant in the Household Dividend Reinvestment and Common
Stock Purchase Plan ("DRS Plan"), the proxy represents the number of full and
fractional shares of Common Stock held in your DRS Plan account, as well as
shares of Common Stock and $6.25 Preferred Stock registered in your name. If you
are a participant in the Household International Tax Reduction Investment Plan

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<PAGE> 7

("TRIP"), an employee benefit plan of Household, the proxy will also serve as
your voting instructions to the Trustee of TRIP, Vanguard Fiduciary Trust
Company, for shares of Common Stock held in your TRIP account. If your voting
instructions are not received by the tabulator, Harris Trust and Savings Bank,
by May 5, 1995, for shares of Common Stock in TRIP, those shares will be voted
by the Trustee in the same manner as the majority of shares for which voting
instructions are received from TRIP participants. For example, with respect to
the election of directors, the Trustee shall vote all unvoted shares of Common
Stock in TRIP for the fourteen nominees (the number of directors to be elected
at the annual meeting) who receive the most votes pursuant to such voting
instructions.

The cost of soliciting proxies will be borne by Household. In addition to
solicitations by mail, personal solicitations without special compensation may
be made by officers, directors, or employees of Household and its subsidiaries
in person or by telephone. Household has also retained Corporate Investor
Communications, Inc., to aid in the solicitation of proxies at a cost of $6,000
plus reimbursement of out-of-pocket expenses.

Household has a policy that all proxies, consents, ballots and voting
materials that identify the vote of specific stockholders will be kept
permanently confidential and will not be disclosed to anyone other than the
inspectors of election and the tabulator; provided, however, that confidential
treatment will not apply when it is not in compliance with law or under
circumstances involving a contested proxy or consent solicitation. The tabulator
will provide all comments written on or accompanying proxies to Household, along
with the name of the stockholder, without indication of the stockholder's vote,
except where the vote is included in the comment or necessary for an
understanding of the comment.

ELECTION OF HOUSEHOLD DIRECTORS

Currently, there are sixteen members of Household's Board of Directors. Gordon
P. Osler, a Director of Household since 1972, and Arthur E. Rasmussen, a
Director of Household since 1967, will be retiring from the Board of Directors
as a result of attaining Household's mandatory retirement age for Directors. The
Board of Directors wishes to thank Messrs. Osler and Rasmussen for their
services to Household over the years. With Messrs. Osler and Rasmussen not
standing for reelection to the Board of Directors, the Board has fixed the
number of Directors of Household at fourteen commencing with the 1995 Annual
Meeting of Stockholders.

The persons named in the accompanying Household proxy intend to vote for the
following fourteen nominees to the Board of Directors to hold office for the
ensuing year and until their successors shall be elected and shall qualify. It
is expected that each of the nominees will be able to serve, but if a vacancy or
vacancies should occur among them for any reason, the said proxies reserve
discretion to vote for, against or to refrain from voting for a substitute
nominee or nominees.

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<PAGE> 8

Information Regarding Nominees

<TABLE>
<CAPTION>
Name, Principal Occupation, and Year First Elected a
Business Associations Age Director of Household
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<S> <C> <C>
WILLIAM F. ALDINGER 47 1994

President and Chief Executive Officer, Household International, Inc.

Mr. Aldinger joined Household in September, 1994, as President and Chief Executive Officer.
He previously served as Vice Chairman of Wells Fargo Bank and a director of several Wells
Fargo subsidiaries since 1986. Mr. Aldinger is also a director of Household Finance
Corporation (a subsidiary of Household).

DONALD C. CLARK 63 1974

Chairman of the Board, Household International, Inc.

Mr. Clark has been with Household since 1955. He was elected Chairman of the Board in 1984,
and served as Chief Executive Officer of Household from 1982 through 1994 and President
from 1977 through 1987. He is also a director of Ameritech Corporation, Household Finance
Corporation (a subsidiary of Household), Schwitzer, Inc., Scotsman Industries, Inc., and
Warner-Lambert Company.

ROBERT J. DARNALL 57 1988

Chairman, President and Chief Executive Officer, Inland Steel Industries, Inc.
(Carbon Steel Manufacturer and Industrial Materials Distributor)

Mr. Darnall was appointed Chairman and Chief Executive Officer in 1992 and has been
President and a director of Inland Steel Industries, Inc. since 1986. From 1984 to 1986 he
was President and Chief Operating Officer--Integrated Steel of Inland Steel Company. Mr.
Darnall is also a director of Cummins Engine Company, Inc.

GARY G. DILLON 60 1984

Chairman of the Board, President and Chief Executive Officer, Schwitzer, Inc.
(Manufacturer of Engine Components)

Mr. Dillon was appointed Chairman of the Board in 1992 and has been President, Chief
Executive Officer, and a director of Schwitzer, Inc. since 1989. He previously served from
1982 through 1989 as President and Chief Executive Officer of Household Manufacturing, Inc.,
the former diversified manufacturing subsidiary of Household.
</TABLE>

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<PAGE> 9

Name, Principal Occupation, and Year First Elected a
Business Associations Age Director of Household
--------------------------------------------------------------------------------------------
<S> <C> <C>
JOHN A. EDWARDSON 45 1995

President of UAL Corporation and United Airlines, Inc.
(Airline Industry)

Mr. Edwardson was appointed President and a member of the Board of Directors of both UAL
Corporation and United Airlines, Inc. in 1994. He previously served as Executive Vice
President and Chief Financial Officer of Ameritech Corporation, Northwest Airlines, and
Imcera Group, Inc.

MARY JOHNSTON EVANS 65 1977

Director

Mrs. Evans served as Vice Chairman of the Board of AMTRAK (National Railroad Passenger
Corporation) between 1974 and 1979. In addition to being a director of Household, Mrs. Evans
is a director of Baxter International Inc., Delta Air Lines, Inc., The Dun & Bradstreet
Corp., Saint-Gobain Corp., Scudder New Europe Fund, and Sun Company, Inc. She is also a
Member of the Advisory Board of Morgan Stanley & Co. Incorporated and a Trustee of several
investment trusts of the American Association of Retired Persons.

CYRUS F. FREIDHEIM, JR. 59 1992

Vice Chairman, Booz, Allen & Hamilton, Inc.
(Management Consulting Firm)

Mr. Freidheim is Vice Chairman of Booz, Allen & Hamilton, Inc., with which he has been
affiliated since 1966. He is also a director of LaSalle Street Fund Inc. and Security
Capital Group, Inc.

LOUIS E. LEVY 62 1992

Director

Mr. Levy retired as Vice Chairman of KPMG Peat Marwick LLP in 1990, having been with the
firm since 1958. Mr. Levy is also a director of Alex Brown/Flag Investors Group of Mutual
Funds and Kimberly-Clark Corporation.
</TABLE>

6
<PAGE> 10

Chairman and Chief Executive Officer, Armstrong World Industries, Inc.
(Manufacturer of Interior Furnishings and Industrial Products)

Mr. Lorch was appointed Chairman of the Board in 1994 and President and Chief Executive
Officer in 1993 and has been a director of Armstrong World Industries, Inc. since 1988. He
has been affiliated with Armstrong since 1963. He is also a director of The Stanley Works.

JOHN D. NICHOLS 64 1988

Chairman and Chief Executive Officer, Illinois Tool Works Inc.
(Manufacturer of Specialty-Engineered Products and Systems)

Mr. Nichols was appointed Chairman and Chief Executive Officer of Illinois Tool Works Inc.
in 1986, having previously served as its President and Chief Executive Officer since 1982,
and has been a director of Illinois Tool Works Inc. since 1981. He is also a director of
Philip Morris Companies Inc., Rockwell International Corporation, and Stone Container
Corporation.

JAMES B. PITBLADO 62 1994

Director

Prior to his 1994 retirement, Mr. Pitblado had been a Senior Executive with RBC Dominion
Securities, Inc. of Toronto, Canada and its predecessor companies for 35 years and served
as Chairman from 1985 until 1992. He previously served between 1984 and 1994 as a director
of Household Financial Corporation Limited (the Canadian business unit of Household). Mr.
Pitblado is a member of the board of Consumers Gas.

S. JAY STEWART 56 1994

Chairman and Chief Executive Officer, Morton International, Inc.
(Diversified Manufacturer)

Mr. Stewart became Chairman of the Board and Chief Executive Officer of Morton
International, Inc., in 1994 and has been a director since 1989. From 1989 through 1994 he
was President and Chief Operating Officer of Morton International.
</TABLE>

7
<PAGE> 11

President of Morehouse School of Medicine
(Educational Institution)

Dr. Sullivan served from 1981 to 1989 and is currently President of the Morehouse School of
Medicine in Atlanta, Georgia. From 1989 to 1993 he served as United States Secretary of
Health and Human Services. Dr. Sullivan is also a director of Bristol-Myers Squibb Company,
CIGNA Corporation, Equifax Inc., General Motors Corporation, Georgia-Pacific Corporation,
and Minnesota Mining and Manufacturing Company.

RAYMOND C. TOWER 70 1984

Director

Mr. Tower retired in 1990 as President and Chief Operating Officer of FMC Corporation, a
position he held since 1980. FMC Corporation is a producer of chemicals and machinery for
industry, government, and agriculture. He also retired as Chairman and Chief Executive
Officer of FMC Gold Company in 1990. Mr. Tower is also a director of Inland Steel
Industries, Inc. and Wellman, Inc.
</TABLE>

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES FOR
DIRECTORS.

THE BOARD OF DIRECTORS

The business and affairs of Household are managed under the direction of the
Board of Directors. The Board of Directors has responsibility for establishing
broad corporate policies and for the overall performance of Household rather
than its day-to-day operation. The prime responsibility of the Board of
Directors is to represent the interests of Household's stockholders, as a whole,
in directing the management of Household so as to protect and enhance its assets
and its earnings. As part of this responsibility, the Board selects, evaluates
and provides for the succession of top management and, subject to shareholder
election, directors; reviews and approves corporate objectives and long-range
plans and strategies; approves any proposed major commitment of corporate
resources and participates in decisions that have potential major economic
impact upon Household. The Board of Directors considers the impact of its
decisions on not only Household's stockholders, but also on Household's
employees, customers, local communities and the public in general. The Directors
are kept informed of Household's businesses by reports and documents sent to
them or presented at meetings of the Board and its committees by officers and
employees of Household and its subsidiaries.

8
<PAGE> 12

The Board of Directors held a total of seven meetings during 1994. No Director
attended fewer than 75% of the aggregate number of meetings of the Board of
Directors and the committees on which he/she served, except for Mr. Lorch. Mr.
Lorch joined Household's Board of Directors on September 13, 1994, and was not
able to attend the November, 1994, meeting of the Board of Directors.
Consequently, Mr. Lorch attended only two of the three meetings held since he
was appointed to Household's Board of Directors, including the Compensation and
Nominating Committees.

COMMITTEES OF THE BOARD

The AUDIT COMMITTEE, which is composed entirely of Directors who are not
officers or employees of Household, reviews the internal accounting, operating
and compliance controls and internal audit functions of Household and its
subsidiaries, Household's accounting principles, policies, and practices and
financial reporting, the scope of the audits conducted by Household's
independent and internal auditors, Household's annual financial statements, and
non-audit services of the independent auditor. The Audit Committee also
recommends to the Board the selection of the principal independent auditor,
subject to ratification by Household's stockholders. During 1994 the Audit
Committee met four times. L. E. Levy is Chairman of the Audit Committee, and
other current members include G. G. Dillon, M. J. Evans, G. P. Osler, J. B.
Pitblado, and A. E. Rasmussen.

The COMPENSATION COMMITTEE, which is composed entirely of Directors who are
not officers or employees of Household, determines the salaries, bonuses, short-
and long-term incentive awards, restricted stock rights, and stock options of
Household's senior management and recommends to the Board the adoption of, or
significant amendments to, Household's employee benefit plans in which senior
management participate. The current members of the Compensation Committee, which
met six times during 1994, are R. C. Tower, Chairman, R. J. Darnall, M. J.
Evans, C. F. Freidheim, Jr., L. E. Levy, G. A. Lorch, and S. J. Stewart. (See
"Report of the Compensation Committee on Executive Compensation" on pages 11 to
17.)

The EXECUTIVE COMMITTEE may, with some exceptions, exercise the powers of the
Board in the management of the business and affairs of Household during
intervals between meetings of the Board. The current members of the Executive
Committee, which met five times during 1994, are J. D. Nichols, Chairman, W. F.
Aldinger, D. C. Clark, R. J. Darnall, G. P. Osler, A. E. Rasmussen, and R. C.
Tower.

The FINANCE COMMITTEE reviews and makes recommendations to the Board
pertaining to Household's dividend policy and reviews and approves the financial
structure and financing requirements and plans of Household and its
subsidiaries. The current members of the Finance Committee, which met twice in
1994, are G. P. Osler, Chairman, W. F. Aldinger, D. C. Clark, G. G. Dillon, C.
F. Freidheim, Jr., L. E. Levy, J. B. Pitblado, and L. W. Sullivan.

9
<PAGE> 13

The NOMINATING COMMITTEE, which is composed entirely of Directors who are not
officers or employees of Household, recommends to the Board the slate of
directors to be nominated for election to the Board at each Annual Meeting of
Stockholders, recommends the election of individuals to fill any vacancies which
may occur on the Board, and reviews management succession and development plans.
Additionally, the Nominating Committee reviews annually the size and composition
of the Board of Directors and also recommends to the Board any changes in
compensation for Directors. In accordance with the bylaws of Household, the
Nominating Committee will consider proposed nominations recommended by
Household's stockholders if such recommendations are submitted in writing and
sent to the Secretary of Household at Household's headquarters. Any stockholder
wishing to submit a recommendation for a proposed nominee should contact the
Secretary to verify the procedures to be followed for such purpose. The
Nominating Committee met four times in 1994, and its current members are A. E.
Rasmussen, Chairman, R. J. Darnall, G. G. Dillon, G. A. Lorch, S. J. Stewart, L.
W. Sullivan, and R. C. Tower.

Mr. Nichols, as Chairman of the Executive Committee, is an "ex officio"
non-voting member of the Audit, Compensation, Finance, and Nominating
Committees.

COMPENSATION COMMITTEE INTERLOCKS

In accordance with the rules promulgated by the Securities and Exchange
Commission ("SEC"), an interlock relationship exists between Messrs. Clark and
Dillon. Mr. Dillon did not serve on the Compensation Committee of Household, and
therefore did not actively participate in the determination of salaries, bonuses
and incentive awards to members of Household's senior management, including Mr.
Clark. However, Mr. Clark became a member of the Compensation Committee of
Schwitzer, Inc. in June 1994, a company that is not affiliated with Household,
of which Mr. Dillon is Chairman of the Board, President and Chief Executive
Officer. In such position, Mr. Clark did participate in discussions relating to
Mr. Dillon's compensation from Schwitzer, Inc.

DIRECTORS' COMPENSATION

In 1994, non-management Directors of Household received an annual cash
retainer of $30,000, an annual cash retainer of $4,000 for each committee on
which a Director serves, and, in certain instances, shares of Household Common
Stock as described below. Household does not pay any meeting attendance fees to
any of its Directors. The Chairmen of the Audit, Compensation, Finance and
Nominating Committees received an additional $5,000 per year, and the Chairman
of the Executive Committee received an additional $30,000 per year. Messrs.
Aldinger and Clark, Directors and current employees of Household, do not receive
any additional compensation related to their service on Household's Board of
Directors.

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<PAGE> 14

During 1995, a program was implemented whereby non-management Directors of
Household may elect to receive all or a portion (in increments of 25%) of their
cash compensation in shares of Household Common Stock. In addition, a Deferred
Fee Plan for Directors was approved in which non-management Directors may choose
to defer all or a portion (in increments of 25%) of their cash compensation to a
future period in time. During the deferred period, Directors may choose to have
their deferred compensation invested in either (a) units comprised of phantom
shares of Household Common Stock, with dividends credited as additional units on
each dividend payment date for Household Common Stock, or (b) cash, with
interest credited at a rate equal to the United States five-year treasury rate
plus the spread over that rate required by the market to be paid by Household
Finance Corporation (the principal subsidiary of Household) for borrowings of
the same duration. At the end of the deferred period, all payments under the
Deferred Fee Plan for Directors will be made in cash in either a lump sum or
quarterly or annual installment payments as selected by the Director.

Household has awarded to Directors who are not officers or employees of
Household 1,300 shares of Common Stock. These shares, however, are subject to
forfeiture to Household unless "earned" by the Director through continued
service on Household's Board for five successive annual meetings. Pursuant to
the award, 200 shares are earned at the first and second annual meeting and 300
shares are earned at the third, fourth and fifth annual meeting. None of the
shares may be sold by a Director prior to the date of the fifth Annual Meeting
of Stockholders so long as such Director is still serving on Household's Board.

Household provides non-management Directors with $250,000 of accidental death
and dismemberment insurance and a $10 million Personal Excess Liability
Insurance Policy. Also, all non-management Directors who complete ten years of
service on the Board, or attain Household's mandatory retirement age for
Directors and have three years of service, are entitled upon retiring from the
Board to continue receiving the Director's annual cash retainer then in effect
for the period equal to the Director's years of service on the Board up to a
maximum of ten years. Also, under Household's Matching Gift Program, Household
matches charitable gifts to qualified organizations (subject to a maximum of
$10,000 per year), with a double match for the first $500 donated to higher
education institutions (both public and private) and eligible non-profit
organizations which promote neighborhood revitalization or economic development
for low and moderate income population. In addition, each non-management
Director may request Household contribute up to $5,000 annually to charities of
the Director's choice which qualify under Household's philanthropic program.

REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION

The disclosure contained in this section of Household's Proxy Statement should
not be incorporated by reference into any prior or future filings by Household
with the SEC pursuant to the Securities Act of

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<PAGE> 15

1933, as amended ("Securities Act") or the Securities Exchange Act of 1934, as
amended ("Exchange Act") that incorporate therein portions of this Proxy
Statement.

GENERAL

The Compensation Committee of Household's Board of Directors determines
salaries and salary ranges for (including the payment of annual or special
bonuses to) (i) employees of Household and its subsidiary corporations who are
members of the Board; and (ii) other employees of Household or its subsidiaries
who earn a yearly salary exceeding an amount which the Compensation Committee,
in its discretion, may fix from time to time (which amount is currently set at
$250,000). The Compensation Committee also recommends to the Board of Directors
the creation or amendment of any pension, profit sharing or tax-qualified
employee benefit plan or program of Household or any long- or short-term
executive compensation plan or program of Household whose participants include
executives whose salaries are determined by the Compensation Committee (except
certain amendments to Household's tax-qualified employee benefit plans and
trusts, and any supplemental plans thereunder, which the officers of Household
are authorized to make on an ongoing basis as they shall deem advisable to
facilitate the administration of such plans or to conform such plans to
applicable laws or regulations); and grants performance units, performance
shares, stock appreciation rights, restricted stock rights, options, or other
awards under any long-term executive compensation plan or program of Household
whose participants include executives whose salaries are determined by the
Committee. The Compensation Committee meets annually to approve the goals
(financial, non-financial, objective and subjective) for each of the executive
officers named herein and meets again after the conclusion of the time period in
which such goals were to be performed to determine the level of performance
against those goals and the resulting compensation to be paid to such officers
for such performance. A report pertaining to those goals and such officer's
performance is then presented to and reviewed by the Board of Directors of
Household.

Household has retained the services of Hewitt Associates, a compensation
consulting firm, to assist the Committee in connection with performance of its
various duties. Hewitt Associates has been retained in this capacity since 1980.
Hewitt Associates provides advice to the Committee with respect to the
competitiveness of compensation paid to senior officers of Household. In doing
so, that firm takes into account the compensation programs, payment history and
compensation goals of Household and compares it to compensation plans and
amounts paid by competing companies. Hewitt Associates has reviewed the
compensation for the Chief Executive Officer and the next four most highly paid
officers for 1994 and has reported to the Committee that, in its opinion, the
compensation of such officers is within current market practice.

12
<PAGE> 16

COMPENSATION PHILOSOPHY AND GOALS

Household's compensation practices must be competitive with the marketplace.
Household strives to provide a total compensation package to key executives
which will support Household's focus on the enhancement of shareholder value, as
well as long-term strategic goals. During 1993 the United States Internal
Revenue Code was modified with regard to compensation paid to key executive
officers of a public company. Household has established compensation programs
which it believes meet all the current tests required for compensation to be
deductible to Household for federal income tax purposes. In the future, it is
the Committee's intent to modify, when necessary, compensation plans for
Household's executive officers so that Household's federal tax deduction is at
all times maximized. However, the Committee reserves the right to use good
independent judgment, on a case by case basis, to attract and retain qualified
executives to manage Household and to reward its employees for excellent service
while taking into consideration the financial effects such action may have on
Household.

It is Household's belief that the total compensation opportunity for each
executive at the present time should include, as a significant component,
payment based on the financial performance of Household. For the executive
officers of Household, other than Messrs. Clark and Aldinger, financial
performance for 1994 was measured in one or more of the following ways: the net
income for Household's core business (i.e., the Finance and Banking segment and
the Individual Life Insurance segment) or a particular business unit thereof;
the attainment of a targeted loss reserve ratio for their respective business
unit; the increase in managed receivables for a business unit by a targeted
amount; and return-on-managed assets for a particular business unit. The
relative weights, if any, assigned to each of the noted factors differ from
executive to executive and may change from time-to-time as circumstances
warrant.

The goals of Household's executive compensation policy are to:

- Recruit and retain exceptional executive talent;

- Reward excellent performance on an individual, business unit and corporate
basis;

- Encourage stock ownership by executives and create an opportunity for
executives, over their career, to accumulate a significant ownership interest
in Household based on their performance and contributions to the creation of
shareholder value; and

- Offer a total compensation package targeted between the 50th-75th percentile
of the defined marketplace, premised however, on achievement of excellent
performance as determined by the Compensation Committee.

13
<PAGE> 17

There are four elements to Household's executive compensation program, each
consistent with its compensation philosophy:

Base Salary: Determined by individual financial and non-financial performance,
position in salary range, and general economic conditions. For purposes of
administering base pay, all executive positions are evaluated and placed in
appropriate salary grades. The establishment of midpoint levels are reviewed on
an annual basis to ensure competitiveness.

Annual Bonus: Tied directly to Household's and/or a business unit's financial
performance as well as individual performance. The purpose of the annual bonus
is to place a significant part of the executive's total compensation at risk and
to reward executives for the achievement of individual, business unit and
corporate financial and operational goals. Annual bonuses are intended to reward
the achievement of excellent performance. Therefore, when certain objective or
subjective performance goals are not met, annual bonuses may be reduced or not
paid.

Long-Term Incentive: The purpose of these plans is to create an opportunity for
executives to share in the enhancement of shareholder value through
non-qualified stock options, restricted stock rights, performance share awards
and performance unit awards. The overall goal of this component of pay is to
create a link between the management of Household and its shareholders through
stock ownership by management and incentive compensation based on the
achievement of specific financial measures.

Executive Benefits: Household provides its executive management with the broad
benefit coverages available to all employees as well as specific, targeted
supplemental benefits that are necessary to be competitive in this area.

EXECUTIVE OFFICER COMPENSATION

- Chief Executive Officers

During 1994 Household had two chief executive officers. Until September 13,
1994, Mr. Clark acted in this capacity. On that date Mr. Aldinger assumed these
duties and continues to be the Chief Executive Officer and President of
Household. The 1994 base salary level for the position of Chief Executive
Officer was determined by the Committee through the use of market data prepared
by Hewitt Associates for positions of a similar nature. The goal of this process
was to assign a value to this position that was representative of similar
positions within a group of industry peers ("Peer Group"), based on a regression
analysis of that position using asset size as the independent variable while
taking into consideration any rights such individual may have under his
employment agreement with Household as described herein and the years of service
such individual has in that position. Mr. Clark's base salary was in the 75th
percentile of this Peer Group, while Mr. Aldinger's was below the 50th
percentile. In January

14
<PAGE> 18

1995, Mr. Clark's base salary was substantially reduced to reflect his change in
position and duties with Household. The Peer Group selected by Household
consists of 17 companies (national and regional banks, or nationally diversified
financial institutions) that have assets under management equivalent, in amount,
to those managed by Household. Of these 17 companies, 13 (or 76%) are included
in the Standard & Poor's Financials Index ("S&P Financials") with the others
being selected for their geographic or product relevance and/or the availability
of relevant compensation information.

As reflected in the Summary Compensation Table, Mr. Clark received an annual
merit increase in 1994 of 8% based on his actions to effectively represent
Household in the industries and the communities in which it participates, the
overall financial performance of Household as reflected by a 14% one-year total
return for Household's Common Stock for the year 1993 and the aforementioned
market data supplied by Hewitt Associates. In regard to Mr. Clark's annual
bonus, pursuant to the Household Key Executive Bonus Plan ("Key Bonus Plan")
that was approved by the stockholders of Household in 1994, the amount awarded
was determined based on the satisfaction of various individual objective non-
financial and financial performance goals. For purposes of the Key Bonus Plan,
the financial performance goals of Household were (a) targeted net income
results for 1994 in its core businesses and as a whole, and (b) targeted credit
loss reserve ratios for its Finance and Banking business segment (collectively,
the "Household Financial Performance Goals"). The Household Financial
Performance Goals established for Mr. Clark represented 60% of Mr. Clark's bonus
opportunity. For 1994, Mr. Clark's annual bonus opportunity was between zero and
100% of his annual salary (with a target bonus of 60%). Mr. Clark was awarded
$880,000 as a result of his performance against these objective goals, as
certified to by the Compensation Committee, as compared to the $823,815 awarded
by the Committee for 1993 performance.

For Mr. Aldinger, his compensation was set by the Committee and approved by
the Board of Directors of Household in connection with his agreement to join
Household as President and Chief Executive Officer from his previous position at
Wells Fargo Bank. Mr. Aldinger's annual salary was set at $700,000 (with
agreement to review his performance in January 1995) and an agreed bonus of
$500,000 for 1994 was stipulated. Mr. Aldinger's performance was reviewed by the
Committee in January 1995. At this review, Mr. Aldinger and the Committee agreed
that there should be no increase in his 1995 base salary due to their mutual
desire to allocate more of his compensation in the form of stock options.

- Other Executive Officers

As for each other executive officer named herein, annual bonuses were paid
under the Household Corporate Executive Bonus Plan based on the (i) officer's
position level with Household, which determines the percentage of annual base
salary which may be awarded, (this ranges from 40% to 100%

15
<PAGE> 19

of annual base salary); (ii) Household's Financial Performance Goals (which
goals were exceeded); and (iii) the satisfaction of various individual objective
and subjective financial and non-financial performance goals in respect of the
business unit for which such officer has responsibility. As to the named
executive officers, all corporate performance goals applicable to such officer
(such goals being listed on page 13 hereof) have been met or exceeded.

- Long-Term Incentive Compensation

All of the named executive officers of Household, including Messrs. Clark and
Aldinger, participate in the Household Long-Term Executive Incentive
Compensation Plan (see pages 22 to 28). In 1994, the long-term incentive
compensation offered by Household through the Incentive Plan was comprised of
four components: stock options, Restricted Stock Rights, Performance Share
Awards and Performance Unit Awards. In order to align Household's long-term
incentive compensation package more closely with that of its shareholders, the
Committee in 1995 decided to cease granting Restricted Stock Rights, Performance
Share Awards and Performance Unit Awards to executives and correspondingly
increased the number of stock options granted. It is the belief of the Committee
that compensation based solely on an increase in the per share price of the
Common Stock of Household is an excellent method for determining a fair level of
compensation to all executives as all Household stockholders must benefit in
order for executive officers to share in that success.

In determining the number of options to be granted to Messrs. Clark and
Aldinger and the other named executive officers, the Compensation Committee
reviewed information developed and presented by Hewitt Associates in regard to
the value of the long-term incentive compensation packages being provided in the
marketplace for executive positions of a similar nature. Based on this review
and Household's philosophy of targeting a total compensation package between the
50th and 75th percentile of this marketplace, the Committee considered the value
presented by Hewitt Associates for the executive's position, the number of
previously awarded options, Restricted Stock Rights, Performance Share Awards or
Performance Unit Awards currently held by such officer and the ownership goals
currently assigned to such officer. No specific weight was accorded to any of
the factors noted in this decision process.

Performance Unit Awards granted under the Incentive Plan in 1992 for the
calendar years 1992, 1993 and 1994 matured on December 31, 1994. The amounts
awarded to Mr. Clark and the other named executive officers were the maximum
amounts permitted under the Incentive Plan as a result of Household achieving an
average return-on-equity ("ROE") for its core businesses ("Core ROE") relative
to the Peer Group for the three-year period ending on December 31, 1994 that was
greater than the 75th percentile of the average ROE for the Peer Group over the
same period.

16
<PAGE> 20

THE COMPENSATION COMMITTEE

It is the Committee's view that the compensation package of Messrs. Clark,
Aldinger and each of the named executive officers was based on an appropriate
balance of (1) Household's, or a particular business unit's, financial
performance in 1994, (2) the performance of each such officer, and (3)
competitive standards. No member of the Committee is a former or current officer
or employee of Household or any of its subsidiaries.

<TABLE>
<S> <C> <C>
COMPENSATION COMMITTEE
R. C. Tower, Chairman L. E. Levy
R. J. Darnall G. A. Lorch
M. J. Evans S. J. Stewart
C. F. Freidheim, Jr.
</TABLE>

17
<PAGE> 21

REMUNERATION OF EXECUTIVE OFFICERS

The table below discloses information concerning compensation for services
rendered during 1994, 1993 and 1992 to Household and its subsidiaries by its
Chief Executive Officer and each of the four most highly paid executive officers
of Household as of December 31, 1994.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
Long Term Compensation
------------------------------------
Awards Payouts
Annual Compensation ------------------------------------
----------------------------------- Number of
Other Restricted Shares
Name and Principal Annual Stock Underlying LTIP All Other
Position Year Salary Bonus Compensation Rights Options Payouts Compensation
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
William F. Aldinger 1994 $185,770 $500,000 (2) $1,960,219(3) 250,000 n/a $ 1,418(4)
President, Chief 1993 n/a n/a n/a n/a n/a n/a n/a
Executive Officer 1992 n/a n/a n/a n/a n/a n/a n/a
and Director(1)
------------------------------------------------------------------------------------------------------------------------------------
Donald C. Clark 1994 $997,119 $880,000 (2) $ 220,275(3) 180,200 $700,800(5) $ 88,038(4)
Chairman of the Board 1993 923,118 823,815 (2) 242,250(3) 62,200 700,800(6) 135,735
and Director 1992 874,700 481,800 (2) 0 60,000 948,900(7) 116,040
------------------------------------------------------------------------------------------------------------------------------------
Antonia Shusta 1994 $398,705 $341,320 (2) $ 66,750(3) 25,000 $156,600(5) $ 27,615(4)
Group Executive -- U.S. 1993 356,714 247,800 (2) 51,000(3) 16,000 156,600(6) 37,412
Consumer and Mortgage 1992 291,800 139,520 (2) 0 16,000 154,200(7) 33,563
Banking, Alexander Hamilton
and the U.K.(8)
------------------------------------------------------------------------------------------------------------------------------------
Joseph W. Saunders 1994 $388,805 $390,000 $113,485(2) $ 66,750(3) 25,000 $131,800(5) $ 31,793(4)
Group Executive -- U.S. 1993 346,912 247,390 (2) 44,625(3) 16,000 131,800(6) 37,495
BankCard and Household 1992 265,593 124,830 (2) 0 16,000 123,000(7) 29,689
Retail Services, Inc.
------------------------------------------------------------------------------------------------------------------------------------
Robert F. Elliott 1994 $333,936 $310,435 (2) $ 56,738(3) 21,000 $118,000(5) $ 31,627(4)
Group Executive -- U.S. 1993 299,358 215,940 (2) 38,250(3) 12,000 118,000(6) 34,095
Consumer Finance and 1992 232,170 134,300 (2) 0 12,000 110,300(7) 28,862
Canada
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Mr. Aldinger joined Household on September 13, 1994, and therefore, the
salary shown is for a partial period beginning September 13, 1994, and
ending on December 31, 1994. Under the terms of his employment agreement,
Mr. Aldinger was guaranteed a bonus in the amount of $500,000 for the 1994
calendar year. Upon joining Household, Mr. Aldinger received a grant of
250,000 stock options and 51,500 Restricted Stock Rights as compensation for
future payment contingencies available from his prior employer that he was
required to forfeit upon leaving this employer in order to join Household.

18
<PAGE> 22

(2) The named officers of Household are entitled to additional forms of
compensation, such as car allowances ($15,000 for Messrs. Aldinger and
Clark, and $11,000 for Ms. Shusta and Messrs. Saunders and Elliott),
financial planning services, club initiation fees, and medical physicals.
Except for Mr. Saunders, the aggregate amount of such other annual
compensation does not exceed $50,000 for any officer, or 10% of the annual
salary and bonus of each named executive officer. In 1994 Mr. Saunders was
provided $100,000 for country club initiation fees.

(3) Restricted Stock Right values reflect the fair market value of the
underlying Household Common Stock on the date of grant. This valuation does
not take into account the diminution in value attributable to the
restrictions applicable to the underlying shares. Based on a closing Common
Stock price of $37 1/8 per share on December 31, 1994, the aggregate value
of the Restricted Stock Rights is as follows: Mr. Aldinger, 51,500 shares
($1,911,938); Mr. Clark, 14,200 shares ($527,175); Ms. Shusta, 3,600 shares
($133,650); Mr. Saunders, 3,400 shares ($126,225); and Mr. Elliott, 2,900
shares ($107,663). All Restricted Stock Rights vest on the fifth anniversary
of the date of grant. Dividends, in the form of additional income, are paid
on all underlying shares for the Restricted Stock Rights at the same rate as
paid to all Common Stock shareholders. In the case of Messrs. Aldinger and
Clark, the payment of such dividends, as well as the vesting, is contingent
upon the satisfaction of certain performance goals related to an increase in
the per share price of Household Common Stock which was established for the
Restricted Stock Rights to meet the IRS tests for deductibility as
previously discussed. See page 25 for further information pertaining to the
Restricted Stock Rights.

(4) Includes $1,418, $23,868, $2,506, $7,244, and $10,595, for Mr. Aldinger, Mr.
Clark, Ms. Shusta, Mr. Saunders, and Mr. Elliott, respectively, relating to
life insurance premiums paid by Household in 1994 for the benefit of the
named executive officer with the remaining amounts noted being Household's
contribution for the executive officer's participation in TRIP or
Supplemental TRIP (see page 21 hereof).

(5) The payment shown for 1994 represented Performance Unit Award payouts for
the years 1992, 1993 and 1994 pursuant to the Incentive Plan (see pages 23
through 25 hereof).

(6) The payment in 1993 represented Performance Unit Award payouts for the years
1992 and 1993 pursuant to the Incentive Plan. During 1992 the Compensation
Committee provided for annual vs. biennial grants and reduced target awards
by 50% to level compensation in future years.

(7) The payment reflected for 1992 represented Performance Unit Award payouts
for the years 1990, 1991 and 1992 pursuant to the Incentive Plan.

(8) Ms. Shusta resigned from her positions with Household effective February 10,
1995.

<PAGE> 23

Executive officers of Household have employment contracts which have been
approved by Household's Compensation Committee. With some exceptions, the term
of each contract is 18 months, automatically renewed monthly, unless Household
chooses not to renew such contract. During the term of the contract, each
executive officer receives a minimum specified annual salary (which may be
increased but not decreased), is entitled to receive benefits from Household's
executive bonus and incentive plans, employee benefit plans, and medical and
life insurance plans, and is guaranteed the level of pension benefits under the
current terms of Household's pension plan. Household may terminate any contract
for cause. An executive may terminate a contract if he or she is transferred,
executive compensation is reduced, or Household gives notice of non-renewal of a
contract, in which case the executive shall receive a lump sum payment,
expressed as a multiple of the executive's base salary, which approximates the
present value of salary, bonuses, benefits and long-term incentives continued
for 18 months.

Under such contracts, an executive whose position is adversely influenced
following a change in control of Household is entitled to receive an additional
severance payment equal to or approximating the foregoing lump sum payment
representing 18 months of total compensation. Except in the case of Messrs.
Aldinger and Clark, no executive will receive the additional severance payment
unless, following the change in control of Household, the executive loses his or
her job or experiences certain other adverse changes in compensation or job
conditions. In the case of Messrs. Aldinger and Clark, they are entitled to
resign and receive all payments under the contract following a change in control
of Household.

If any payments to an executive would constitute an "excess parachute payment"
within the meaning of Section 280G(b) of the Internal Revenue Code of 1986, as
amended ("Code"), and if the aggregate of all such payments to the executive can
be reduced by 10% or less and thereby avoid any such excess payments, then the
payments shall be so reduced. Otherwise, the contracts provide that Household
will pay the executive an additional amount equal to the excise tax imposed
under Section 4999 of the Code plus a further amount to equal the income tax
payable with respect to the payment of such excise tax amount and such income
tax amount.

Executive officers and Directors of Household have from time to time been
customers of, or had transactions with, Household's banking, finance or
securities brokerage subsidiaries, or may become customers thereof in the
future. Such transactions, which include margin loans, credit cards and mortgage
loans, are made by such subsidiaries in the ordinary course of business on
substantially the same terms, including interest rate and collateral, if any, as
those prevailing at the time for comparable transactions with other persons and
do not involve more than the normal risk of collectibility or present other
unfavorable features.

20
<PAGE> 24

SAVINGS-STOCK OWNERSHIP AND PENSION PLANS

Household has established its Tax Reduction Investment Plan ("TRIP"), which is
a deferred profit-sharing and savings plan for eligible employees of Household
and its participating subsidiaries. With certain exceptions an employee at least
21 years of age with one year of service (three years of service if under age
21) and not part of a collective bargaining unit may contribute into TRIP, on a
pre-tax and after-tax basis, up to 15% of the participant's cash compensation
(subject to a maximum annual pre-tax contribution by a participant of $9,240, as
adjusted for cost of living increases, and subject to certain other limitations
imposed by the Code) and invest such contributions in Household Common Stock or
separate equity or income funds. Each participant's own contribution is matched
in whole or in part by Household contributions at a rate determined by
Household, but Household's matching contributions may not exceed 6% of a
participant's compensation. Household matching contributions are invested in
Household Common Stock. A graduated vesting schedule provides for partial
vesting on the basis of years of plan participation, and each participant
becomes fully vested in such Household matching contributions after five years
of employment. With certain exceptions, a participant's after-tax contributions
may be withdrawn at any time, and Household contributions may be withdrawn after
five years of plan participation. A participant's pre-tax contributions may not
be withdrawn except for an immediate financial hardship, upon termination of
employment, or after attaining age 59 1/2. In addition, participants may obtain
loans from their TRIP accounts under certain circumstances.

Household has also established the Supplemental Tax Reduction Investment Plan
("Supplemental TRIP"), an unfunded plan for eligible employees of Household and
its participating subsidiaries who are limited as to their participation in TRIP
due to the Code. Only matching contributions required to be made by Household
pursuant to TRIP are invested in Supplemental TRIP through a credit to a
bookkeeping account maintained by Household which deems such contributions as
being invested in Common Stock share equivalents.

Household's pension plan, the Household Retirement Income Plan ("Retirement
Plan"), is a non-contributory, defined benefit plan for employees of Household
and its U.S. subsidiaries who are at least 21 years of age with one year of
service and not part of a collective bargaining unit. Annual pension benefits
equal a percentage of an employee's "Final Average Salary" (as defined) not in
excess of "Covered Compensation" (as defined) plus a percentage of an employee's
"Final Average Salary" that exceeds Covered Compensation. Covered Compensation
is the average of the Social Security taxable wage base over the 35 year period
ending in the year of retirement or earlier termination of employment. Final
Average Salary equals the average of salary plus bonus, whether paid in cash or
stock, for the four successive highest paid years out of the employee's last 10
years of service. The percentage applied to Final Average Salary and Covered
Compensation is determined on the basis of years of employment and age at
retirement. This percentage increases as years of employment and age at
retirement increase.

21
<PAGE> 25

Participants become fully vested in their accrued pension benefits after five
years of employment. Payment of vested pension benefits normally begins at age
65, but an early retirement benefit at reduced levels may be paid if a
participant is at least 55 years of age with 10 years of service or, if the
participant was an employee on December 31, 1989, is at least 50 years of age
with 15 years of service.

A portion of the benefits payable under the Retirement Plan to certain
executive officers (including those named in the Summary Compensation Table) may
be paid by Household through the Supplemental Retirement Income Plan
("Supplemental RIP"). The Supplemental RIP was established due to the
limitations imposed on the Retirement Plan by certain federal laws which
restrict the amount of benefits payable under tax-qualified plans. Payments made
by Household under the Supplemental RIP to certain officers have been deposited
by such officers in secular trusts which they created.

The following table on an incremental basis illustrates the amount of the
Retirement Plan's (including the Supplemental RIP and any secular trust created
in connection therewith) total annual pension benefits on a straight-life
annuity basis for eligible employees retiring at age 65 who were employed on or
before December 31, 1994. The amounts in this table are not subject to deduction
for Social Security or other offset amounts and do not reflect any limitations
on benefits imposed by ERISA or federal tax laws.

<TABLE>
<CAPTION>
Average Annual 40 or More
Compensation Used as 15 to 30 35 Years Years of
Basis For Computing Pension Years of Service of Service Service
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 400,000 $ 226,445 $ 236,445 $ 246,445
-------------------------------------------------------------------------------------------------------------
$ 600,000 $ 340,445 $ 355,445 $ 370,445
-------------------------------------------------------------------------------------------------------------
$ 800,000 $ 454,445 $ 474,445 $ 494,445
-------------------------------------------------------------------------------------------------------------
$1,000,000 $ 568,445 $ 593,445 $ 618,445
-------------------------------------------------------------------------------------------------------------
$2,000,000 $1,138,445 $1,188,445 $1,238,445
-------------------------------------------------------------------------------------------------------------
</TABLE>

The years of service of Mr. Aldinger, Mr. Clark, Ms. Shusta, Mr. Saunders, and
Mr. Elliott for purposes of the Retirement Plan are, respectively, 0 years, 39
years, 6 years, 9 years, and 31 years.

INCENTIVE AND STOCK OPTION PLANS

Household's stockholders have approved a Long-Term Executive Incentive
Compensation Plan ("Incentive Plan"). The Compensation Committee of the Board of
Directors in its discretion selects employees of Household and its subsidiaries
to receive awards under the Incentive Plan. The Compensation Committee may award
stock options, Stock Appreciation Rights, Performance Unit Awards, Performance
Share Awards, and Restricted Stock Rights under the Incentive Plan. The

22
<PAGE> 26

Incentive Plan contains a provision to protect participant's rights thereunder
in the event of a change in control of Household.

The Compensation Committee may grant any type of option to purchase shares of
Household Common Stock that is permitted by law at the time of grant. Options
will generally not be exercisable less than one year nor more than ten years and
one day from the date of grant; provided, however, the Compensation Committee,
in its discretion, may extend the expiration date of any option other than
options which are intended to qualify as Incentive Stock Options pursuant to the
Code, provided the expiration date of such options does not exceed 15 years from
the date of the grant of such options. The Compensation Committee has not
extended the expiration date of any option granted to any of the named executive
officers. The option price per share will not be less than the fair market value
of one share of Household Common Stock on the date of grant. Payment for options
may be made with cash or, in the discretion of the Compensation Committee, with
shares of Household Common Stock or both cash and shares. The Compensation
Committee may authorize an extension of credit from Household to an employee
(including an employee who is an officer or director of Household) to assist the
employee in the purchase of Household Common Stock through a stock option
awarded under the Incentive Plan. The Committee has not authorized any such
loans as of March 15, 1995.

As of March 15, 1995, there are 5,640,323 shares of Household Common Stock
available for issuance under the Incentive Plan, which shares will be
proportionately adjusted for any stock dividends, stock splits, consolidations
or reclassifications. Shares of Common Stock issued pursuant to the Incentive
Plan may be authorized but unissued shares or treasury shares. Any unissued
shares or shares subject to option grants which expire in accordance with their
terms will be carried forward and available for issuance by the Compensation
Committee pursuant to the Incentive Plan in future years.

In accordance with the Incentive Plan, in certain instances the Compensation
Committee had granted Stock Appreciation Rights ("SARs") in tandem with options.
As of the date of this Proxy Statement, there are no outstanding SARs.

The Incentive Plan also authorizes the Compensation Committee to grant
Performance Unit Awards and Performance Share Awards. Upon granting such awards,
the Compensation Committee will establish a performance period over which the
performance of a holder of a Performance Unit Award or Performance Share Award
will be measured. The Committee will also establish maximum and minimum
performance target levels (subject to such later revisions as the Committee
deems appropriate to reflect significant, unforeseen events or changes). Each
Performance Unit Award will have an initial value of $100 per unit, and each
Performance Share Award will initially represent one share of Household Common
Stock. The value of Performance Unit Awards and the number of shares of
Household Common Stock represented by Performance Share Awards may increase or
decrease

23
<PAGE> 27

depending on the extent to which the holder of such award achieves the
performance targets by the end of the performance period. Payment will be made
in a lump sum or on a deferred basis, in which case interest will accrue on such
deferred amounts until paid.

At year-end 1994 there were 8,300 outstanding Performance Unit Awards granted
to Household's executive officers, of which 3,100 Performance Unit Awards were
for the 1993-1995 performance period and 5,200 Performance Unit Awards were for
the 1994-1996 performance period. At the end of the performance period, payment
(if any) on Performance Unit Awards will be based on the extent to which certain
return on equity goals previously established by the Compensation Committee are
achieved. Each Performance Unit Award has an initial payment value of $100,
which may increase (to a maximum of $200) or decrease based on Household's level
of achievement in reaching the performance goals. The following table describes
the Performance Unit Awards and Performance Share Awards granted to the named
executive officers of Household during 1994.

LONG-TERM INCENTIVE PLAN AWARDS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
Performance Estimated Future Payouts
Number of or Other Under Non-Stock Price-Based
Shares, Units Period Until Plans(1)(2)
or Other Maturation or -----------------------------------
Name Rights Payout(3) Threshold Target Maximum
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
William F. Aldinger 0 units n/a $ 0 $ 0 $ 0
--------------------------------------------------------------------------------------------------------
Donald C. Clark 2,800 units 3 years (1996) $140,000 $280,000 $560,000
--------------------------------------------------------------------------------------------------------
Antonia Shusta 800 units 3 years (1996) $ 40,000 $ 80,000 $160,000
20,000 shares(4) 3-5 years (1996-98) n/a n/a n/a
--------------------------------------------------------------------------------------------------------
Joseph W. Saunders 800 units 3 years (1996) $ 40,000 $ 80,000 $160,000
20,000 shares(4) 3-5 years (1996-98) n/a n/a n/a
--------------------------------------------------------------------------------------------------------
Robert F. Elliott 800 units 3 years (1996) $ 40,000 $ 80,000 $160,000
20,000 shares(4) 3-5 years (1996-98) n/a n/a n/a
--------------------------------------------------------------------------------------------------------
</TABLE>

(1) Payments, if any, for Performance Unit Awards maturing at the end of 1996
are based on measuring the Core ROE performance of Household. For example,
to achieve the threshold, target or maximum payments, Household's results
must be 150 basis points below the 50th percentile, in the 50th percentile
or in the 75th percentile, respectively, of the ROE performance of the Peer
Group. Any payments may be made in cash or a combination of cash and
Household Common Stock, subject to a maximum of 50% in stock.

(2) Under the terms of the Incentive Plan, the Compensation Committee retains
discretion, subject to the Incentive Plan's limits, to modify terms of
outstanding awards to take into account the effect of unforeseen or
extraordinary events and accounting changes.

24
<PAGE> 28

(3) The performance or other time period until payment or maturation of the
performance unit awards began on January 1, 1994. The executive officers
received the noted performance unit awards on March 8, 1994.

(4) The Performance Share Awards were awarded to the named executives on
February 1, 1994. The awards have a five-year term and will vest as follows
on the grant date anniversary: 25% on the third anniversary, 25% on the
fourth anniversary and 50% on the fifth anniversary. No shares will be
issued unless a payment has been made from a Performance Unit Award cycle,
if one is applicable, in the year in which the Performance Share Awards
become vested; i.e., for the 25% vesting on the third anniversary, there
must be a payment under the 1994-96 Performance Unit Award cycle.

The Incentive Plan also authorizes the Compensation Committee to grant
Restricted Stock Rights ("RSRs"). RSRs entitle an executive to receive a stated
number of shares of Household Common Stock if the executive remains continuously
employed by Household for a number of years (the "restricted period") specified
by the Compensation Committee. However, the Compensation Committee in its sole
discretion may accelerate the payment of Household Common Stock prior to the
termination of the restricted period if the Committee believes factors warrant
such acceleration, such as the holder of the RSR achieves certain performance
levels established at the time the RSR is granted by the Compensation Committee
or if there is a change in control of Household. A holder of RSRs will not be
entitled to any of the rights of a holder of Household Common Stock prior to the
payment of such shares; however, at the discretion of the Compensation
Committee, Household will pay an amount in cash equal to the cash dividends
declared on Household Common Stock for each share of stock subject to an RSR.
For 1992, there were no RSRs granted pursuant to the Incentive Plan. During 1993
and 1994, RSRs were granted to the named executive officers herein as follows:

<TABLE>
<CAPTION>
Name 1994 1993 Total
<S> <C> <C> <C>
-----------------------------------------------------------
William F. Aldinger 51,500 0 51,500
-----------------------------------------------------------
Donald C. Clark 6,600 7,600 14,200
-----------------------------------------------------------
Antonia Shusta 2,000 1,600 3,600
-----------------------------------------------------------
Joseph W. Saunders 2,000 1,400 3,400
-----------------------------------------------------------
Robert F. Elliott 2,000 1,200 3,200
-----------------------------------------------------------
</TABLE>

The average purchase price for all outstanding options held by the 475
participants in the Incentive Plan at December 31, 1994, was $27.6541 with
expiration dates for such options ranging from 1995 to 2004. The following table
shows as to the named executive officers the number of shares of Household
Common Stock acquired during 1994 on exercise of an option granted pursuant to
the Incentive Plan, the value realized (market value less option price) and the
number of unexercised options and the potential value thereof as of December 31,
1994.

25
<PAGE> 29

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
Number of
Shares Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
December 31, 1994 December 31, 1994
Shares Acquired Exercisable/ Exercisable/
Name on Exercise Value Realized Unexercisable Unexercisable(1)
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
William F. Aldinger 0 $0 0/250,000 $ 0/$ 0
----------------------------------------------------------------------------------------------------------
Donald C. Clark 0 $0 195,760/269,350 $2,617,769/$1,113,241
----------------------------------------------------------------------------------------------------------
Antonia Shusta 0 $0 42,042/ 48,500 $ 484,570/$ 311,178
----------------------------------------------------------------------------------------------------------
Joseph W. Saunders 0 $0 31,770/ 48,500 $ 392,319/$ 311,178
----------------------------------------------------------------------------------------------------------
Robert F. Elliott 0 $0 22,262/ 39,500 $ 259,446/$ 257,055
----------------------------------------------------------------------------------------------------------
</TABLE>

(1) Calculated based on the fair market value of Household Common Stock on
December 31, 1994 ($37 1/8 per share).

The following table shows, as to the named executive officers, the number of
stock options granted in 1994, the percentage of the total number of option
grants to employees during the last fiscal year represented by each grant to a
named individual, the per share exercise or base price and the expiration date.
In addition, the table presents the potential realizable value for each grant to
the named officers and the resulting benefit to all Household Common Stock
shareholders if the assumed appreciation in stock price occurs. The presentation
of stock options in the table below is required by the rules of the SEC and
therefore, is not intended to forecast possible future appreciation, if any, of
the Common Stock price. Household did not use any alternative formula for a
grant date valuation as Household is not aware of any formula which will
determine, with reasonable accuracy, a present value for stock options based on
future unknown or volatile factors.

26
<PAGE> 30

OPTION GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
Potential
Individual Grants(1) Realizable Value at
---------------------------------------------------------------------------------------- Assumed Annual
Number of % of Total Rates of Stock Price
Shares Options Exercise Appreciation
Underlying Granted to or Base for Option Term
Options Employees Price Expiration -----------------------------------------
Name Granted in Fiscal Year ($/Share) Date 0% 5% 10%
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
All Common Shareholders(2) n/a n/a n/a n/a $0 $2,027,626,530 $5,138,403,725
-----------------------------------------------------------------------------------------------------------------------------------
All Optionees(3) 1,078,700 100% $33.3750 2/1/04 $0 $ 22,641,221 $ 57,377,298
-----------------------------------------------------------------------------------------------------------------------------------
Optionee Gain as % of All
Common Shareholders Gain n/a n/a n/a n/a n/a 11% 11%
-----------------------------------------------------------------------------------------------------------------------------------
William F. Aldinger 250,000 23.2% $38.0625 9/13/04 $0 $ 5,984,325 $ 15,165,456
-----------------------------------------------------------------------------------------------------------------------------------
Donald C. Clark 80,200 7.4% $33.3750 2/1/04 $0 $ 1,683,347 $ 4,265,931
100,000 9.3% $38.0625 9/12/99 $0 $ 1,050,947 $ 2,322,153
-----------------------------------------------------------------------------------------------------------------------------------
Antonia Shusta 25,000 2.3% $33.3750 2/1/04 $0 $ 524,734 $ 1,329,779
-----------------------------------------------------------------------------------------------------------------------------------
Joseph W. Saunders 25,000 2.3% $33.3750 2/1/04 $0 $ 524,734 $ 1,329,779
-----------------------------------------------------------------------------------------------------------------------------------
Robert F. Elliott 21,000 1.9% $33.3750 2/1/04 $0 $ 440,777 $ 1,117,014
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Options were granted on February 1, 1994, except for special stock option
grants to Messrs. Aldinger (250,000) and Clark (100,000) on September 13,
1994, and are exercisable starting twelve months after the grant date, with
25% of the shares covered thereby becoming exercisable at that time and with
an additional 25% of the option shares becoming exercisable on each
successive anniversary date, with full vesting occurring on the fourth
anniversary date. Under the terms of the Incentive Plan, the Compensation
Committee retains discretion, subject to Incentive Plan limits, to modify
the terms of outstanding options and to reprice the options. During 1994, no
options granted to any of the named executives pursuant to the Incentive
Plan were repriced.

The exercise price and tax withholding obligations related to exercise may
be paid by delivery of already owned shares of Common Stock or by offset of
the underlying shares, subject to certain conditions.

The options were granted for a term of 10 years and one day, subject to
earlier termination or certain events related to termination of employment,
except for Mr. Clark's special stock option grant on September 13, 1994,
which has a term of five years.

(2) All common shareholders are shown for comparison purposes only. The
Potential Realizable Value to all common shareholders is the aggregate net
gain for all common shareholders, assuming a starting market price of
$33 3/8 (the fair market value option price determined on February 1, 1994),
and appreciation at an assumed annual rate of 5% and 10% for a ten year
period. There can be no

27
<PAGE> 31

assurance that the Common Stock will perform at the assumed annual rates
shown in the table. Household will neither make nor endorse any
predictions as to future stock performance.

(3) The option price shown for the "All Optionees" line is $33 3/8 per share
since the vast majority of options granted during 1994 were at that price.
Correspondingly, the expiration date for the "All Optionees" line is
February 1, 2004 since that is the applicable date for the vast majority of
options granted during 1994.

SHARES OF HOUSEHOLD STOCK BENEFICIALLY OWNED BY DIRECTORS AND EXECUTIVE OFFICERS

Under technical rules of the SEC, the following individuals and group are
deemed to beneficially own the shares of Household Common Stock listed below as
of March 15, 1995. "Beneficial ownership" includes shares for which an
individual, directly or indirectly, has or shares voting and/or investment
power, whether or not the individual gains any economic benefit from such
shares, and also includes shares which the individual has the right to acquire
within 60 days. No Director or executive officer owns any shares of Household's
$6.25 Preferred Stock; Flexible Rate Auction Preferred Stock, Series B;
Depositary Shares representing Household's 9 1/2% Cumulative Preferred Stock,
Series 1989-A; Depositary Shares representing Household's 9 1/2% Cumulative
Preferred Stock, Series 1991-A; Depositary Shares representing Household's
8 1/4% Cumulative Preferred Stock, Series 1992-A; or Depositary Shares
representing Household's 7.35% Cumulative Preferred Stock, Series 1993-A.

28
<PAGE> 32

<TABLE>
<CAPTION>
Number Number
of Shares of Common
Beneficially Stock
Name of Beneficial Owner Owned(1) Equivalents(2) Total
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
William F. Aldinger 15,000 0 15,000
-----------------------------------------------------------------------------------------------------------------
Donald C. Clark 620,663 58,043 678,706
-----------------------------------------------------------------------------------------------------------------
Robert J. Darnall 3,198 0 3,198
-----------------------------------------------------------------------------------------------------------------
Gary G. Dillon 20,810 0 20,810
-----------------------------------------------------------------------------------------------------------------
John A. Edwardson 1,300 0 1,300
-----------------------------------------------------------------------------------------------------------------
Robert F. Elliott 70,702 1,361 72,063
-----------------------------------------------------------------------------------------------------------------
Mary J. Evans 3,966 0 3,966
-----------------------------------------------------------------------------------------------------------------
Cyrus F. Freidheim, Jr. 3,382 0 3,382
-----------------------------------------------------------------------------------------------------------------
Louis E. Levy 3,900 0 3,900
-----------------------------------------------------------------------------------------------------------------
George A. Lorch 1,511 0 1,511
-----------------------------------------------------------------------------------------------------------------
John D. Nichols 41,300 0 41,300
-----------------------------------------------------------------------------------------------------------------
James B. Pitblado 3,519 0 3,519
-----------------------------------------------------------------------------------------------------------------
Joseph W. Saunders 77,676 1,931 79,607
-----------------------------------------------------------------------------------------------------------------
Antonia Shusta 87,168 3,952 91,120
-----------------------------------------------------------------------------------------------------------------
S. Jay Stewart 2,519 0 2,519
-----------------------------------------------------------------------------------------------------------------
Louis W. Sullivan 1,494 0 1,494
-----------------------------------------------------------------------------------------------------------------
Raymond C. Tower 2,835 0 2,835
-----------------------------------------------------------------------------------------------------------------
Directors and Executive Officers as a Group 960,943 65,287 1,026,230(3)
-----------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Directors and executive officers have sole voting and investment power over
shares listed above, except as follows. Shares beneficially owned by
non-management Directors include shares awarded, but not yet earned, as part
of their annual compensation as described under "Directors' Compensation".
Non-management Directors have sole voting power and no current investment
power over such shares.

The number of shares of Common Stock held by spouses or children in which
voting and investment power is shared (or presumed to be shared) is as
follows: Mr. Clark, 200; Ms. Shusta, 11,722; Mr. Saunders, 976; and
Directors and executive officers as a group, 12,898. The number of shares
of Common Stock held by spouses or children in which beneficial ownership
is disclaimed is as follows: Mr. Nichols, 3,300; and Directors and
executive officers as a group, 3,300. The number of shares of Common Stock
held under Household's employee benefit plans in which participants have
voting rights and/or investment power is as follows: Mr. Aldinger, 0; Mr.
Clark, 123,375; Ms. Shusta, 1,806; Mr. Saunders, 9,013; Mr. Elliott,
15,925; and Directors and executive officers as

29
<PAGE> 33

a group, 150,119. The number of shares included in the table above which
may be acquired by Household's executive officers through May 14, 1995,
pursuant to the exercise of employee stock options is: Mr. Aldinger, 0; Mr.
Clark, 258,860; Ms. Shusta, 59,792; Mr. Saunders, 49,520; Mr. Elliott,
37,012; and Directors and executive officers as a group, 405,184.

(2) Under Household's Supplemental TRIP the number of Common Stock share
equivalents owned by Directors and executive officers of Household. No
voting rights attach to these share equivalents which perform economically
in the same manner as Household's Common Stock.

(3) No Director or executive officer beneficially owns directly or indirectly
more than one percent of Household's Common Stock. Directors and executive
officers as a group beneficially own 1% of Household's Common Stock. As a
group, the Directors and executive officers of Household named herein
increased their ownership of Household Common Stock by 32,986 shares during
1994.

The employees of Household are entitled to participate in TRIP and as of
December 31, 1994, TRIP held 4,459,617 shares of Common Stock, excluding
the shares held by Directors and executive officers which are reflected in
the table. In addition, Household's Pooled Investment Fund ("PIF"), which
holds assets of the domestic pension plan of Household, held 1,258,807
shares of Common Stock as of December 31, 1994. As a result, TRIP and PIF
held 5.9% of the Common Stock outstanding on December 31, 1994.

Household believes that stock ownership by its executive officers and key
employees is important to promote an identification of the interests of
management and employees with Household's stockholders. As a result, Household
established in 1991 stock ownership goals for approximately 250 of its
management and key employees with the intent that such individuals, in total,
have approximately $60 million invested in Household's Common Stock. Pursuant to
these goals, Household expects that a certain multiple of the established
midpoint of each officer's or key employee's salary range be invested in Common
Stock by January 1, 1999. As part of this program, the officers and key
employees of Household strive to attain one-eighth of this goal each year. The
following table reflects the stock ownership goals for the named individuals in
the Summary Compensation Table.

30
<PAGE> 34

<TABLE>
<CAPTION>
Stock Ownership Goal
------------------------------------
Current As a Multiple
Stock of Salary Range Number
Name Title Ownership(1) Midpoint of Shares(2)
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
William F. Aldinger President & Chief Executive Officer 35,750 11 252,819
-------------------------------------------------------------------------------------------------------------------
Donald C. Clark Chairman of the Board 556,576 11 252,819
-------------------------------------------------------------------------------------------------------------------
Group Executive -- U.S. Consumer and
Mortgage Banking, Alexander Hamilton
Antonia Shusta and the U.K. 63,024 8 74,899
-------------------------------------------------------------------------------------------------------------------
Group Executive -- U.S. BankCard and
Joseph W. Saunders Household Retail Services, Inc. 54,891 8 74,899
-------------------------------------------------------------------------------------------------------------------
Group Executive -- U.S. Consumer
Robert F. Elliott Finance and Canada 53,564 8 74,899
-------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) For purposes of this program, the number of shares of Common Stock shown are
those credited to the executive's account as of December 31, 1994. Such
amount includes the number of shares held directly and indirectly, the
number of shares held under Household's benefit plans, including Common
Stock share equivalents held pursuant to Supplemental TRIP, 50% of vested,
unexercised stock options, and 50% of Restricted Stock Rights.

(2) Calculated by taking the dollar amount of the executive's salary range
midpoint multiplied by the multiple shown and dividing that amount by the
fair market value of the Common Stock on December 31, 1994 ($37 1/8 per
share).

Section 16(a) of the Exchange Act requires Household's Directors and executive
officers, and any persons holding more than ten percent of a registered class of
Household's equity securities to report their initial ownership of Household's
equity securities and any subsequent changes in that ownership to the SEC and
the New York Stock Exchange. Specific due dates for these reports have been
established by the SEC and Household is required to disclose in this Proxy
Statement any failure to file by these dates during 1994. To Household's
knowledge, based solely on review of the copies of such reports furnished to
Household and written representations that no other reports were required, all
Section 16(a) filing requirements applicable to its executive officers,
directors and greater than ten percent beneficial owners were complied with,
except that Mr. J. W. Saunders, an executive officer, was discovered to have
failed to timely file reports reflecting the transfer of shares of Common Stock
to his children, regular quarterly dividend reinvestment acquisitions in his
brokerage accounts, and the purchase of 100 shares of Common Stock for his
individual retirement account.

31
<PAGE> 35

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

As of March 15, 1995, to the best of Household's knowledge no person
beneficially owned more than 5% of a class of Household's voting securities.

APPROVAL OF EMPLOYEE STOCK PURCHASE PLAN

Upon the recommendation of the Compensation Committee of the Board of
Directors, the Board of Directors has adopted, and is submitting for stockholder
approval, the Household International Employee Stock Purchase Plan (the "ESPP").
The ESPP is intended to comply with Section 423(b) of the Internal Revenue Code
and was created to enable employees of Household to become owners of Household
through the purchase of shares of its Common Stock, thereby correlating their
interest in Household's growth, productivity and profitability to that of all
stockholders of Household. Under the ESPP, a maximum of 2,000,000 shares of
Household Common Stock may be issued. The summary of the ESPP is qualified in
its entirety by reference to the full text of the ESPP as set forth in Appendix
A hereto.

The affirmative vote of the holders of a majority of all stock entitled to
vote at this annual meeting, present in person or by proxy, is required to
approve the ESPP. No purchase rights have been or will be offered pursuant to
the ESPP unless the ESPP is approved by Household's stockholders.

The ESPP shall be administered by the Compensation Committee of the Board of
Directors. The ESPP permits employees of Household and such subsidiaries as
designated by the Compensation Committee, to specify a fixed dollar amount to be
withheld during each payroll period during a plan period. The length of plan
periods will be established by the Compensation Committee and are expected to be
approximately one year. At the end of each plan period, funds withheld by
Household under the ESPP for the account of each participating employee, plus
interest thereon at a rate to be established at the start of the plan period by
the Compensation Committee, will be used to purchase Household Common Stock in
the name of such participating employee. The purchase price for the stock will
be equal to the lesser of: (a) a fixed percentage of the fair market value of
Household's Common Stock on the first day of the plan period, and (b) a fixed
percentage of the fair market value of the Common Stock on the last day of the
plan period. For purposes of the ESPP, the fair market value of Household's
Common Stock on such dates will be the average of the high and low sale prices
of the Common Stock on the New York Stock Exchange for each of the ten preceding
trading days. The percentages of fair market value which shall be set to
determine the purchase price on the first and last day of a plan period will be
established by the Compensation Committee prior to the enrollment for each plan
period and will be no less than 85% or more than 100%. The Compensation
Committee may establish different percentages to apply at the start and end of a
plan period.

32
<PAGE> 36

The maximum number and value of shares of Common Stock which may be purchased
in any plan period and any calendar year will be limited. The maximum number of
shares which an employee may purchase in a plan period will be equal to the
number which would be purchasable at the closing price for Household's Common
Stock on the first day of the plan period (without discount) based upon the
aggregate amount expected to be withheld from an employee's pay during the plan
period, multiplied by a number not to exceed 1 1/2, as established by the
Compensation Committee. During any calendar year, no employee will be permitted
to purchase under the ESPP Common Stock with a fair market value in excess of
$25,000 as of the first day of the plan period. Furthermore, no employee will be
permitted to purchase Common Stock under the ESPP if following such purchase the
employee would own stock with 5% or more of the voting power or value of all
classes of Household's stock outstanding.

To be eligible to participate in the ESPP, an employee must have been employed
by Household or an eligible subsidiary, as determined by the Compensation
Committee, as of December 31 of the year prior to the start of a designated plan
period and customarily works at least 20 hours per week for not less than five
months in a calendar year. The Compensation Committee will have the right to
exclude participation by certain employees if considered to be "highly
compensated" as defined by the Code. The Compensation Committee currently
intends that the ESPP will not be available to members of management who are
also members of the Board of Directors and to any officers who report directly
to such individuals.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE HOUSEHOLD
INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN.

SELECTION OF AUDITORS

Based upon the recommendation of the Audit Committee, Household's Board of
Directors has voted to appoint, subject to ratification by Household's
stockholders, Arthur Andersen LLP as the firm of independent certified public
accountants to audit the financial statements of Household and its subsidiaries
for the current year. Although it is not required to do so, the Board is
submitting the selection of auditors for ratification in order to obtain
stockholders' approval of this appointment. If the selection is not ratified,
the Board of Directors will reconsider the appointment. A representative of
Arthur Andersen LLP will be present at the annual meeting with the opportunity
to make a statement to stockholders if he so desires and to respond to
appropriate questions from stockholders.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF ARTHUR
ANDERSEN LLP AS THE INDEPENDENT AUDITORS FOR HOUSEHOLD FOR 1995.

33
<PAGE> 37

PERFORMANCE OF HOUSEHOLD

The graphs, tables and the related disclosure contained in this section of the
Proxy Statement should not be incorporated by reference into any prior or future
filings by Household under the Securities Act or the Exchange Act that
incorporate therein portions of this Proxy Statement. The stock price
performance evidenced by the graphs and the tables is not necessarily indicative
of future price performance.

Set forth below are graphs and tables comparing total returns (assuming
reinvestment of dividends) of Household, the Standard & Poor's 500 Composite
Stock Price Index ("S&P 500"), and the S&P Financials. Household is one of the
companies composing the referenced indices. The graphs assume $100 is invested
on the last day of the first month indicated in Household Common Stock and each
of the other indices. Household has presented information pertaining to total
shareholder return over different time periods since all holders of the Common
Stock did not acquire their investment in Household on the same date. Household
believes a presentation in this format more accurately reflects the financial
return provided to the holders of Household's Common Stock which may not be
evident if only one time period was highlighted.

ONE-YEAR CUMULATIVE TOTAL RETURN
BASED ON REINVESTMENT OF $100 BEGINNING DECEMBER 31, 1993

<TABLE>
<CAPTION>
MEASUREMENT PERIOD S&P
(FISCAL YEAR COVERED) HOUSEHOLD S&P 500 FINANCIALS
<S> <C> <C> <C>
12/93 $100 $100 $100
1/94 $101 $103 $105
2/94 $106 $100 $ 99
3/94 $ 92 $ 96 $ 96
4/94 $ 97 $ 97 $ 99
5/94 $105 $ 99 $104
6/94 $106 $ 97 $101
7/94 $106 $100 $103
8/94 $123 $103 $107
9/94 $113 $101 $100
10/94 $111 $103 $101
11/94 $121 $ 99 $ 95
12/94 $118 $101 $ 97
</TABLE>

34
<PAGE> 38

THREE-YEAR CUMULATIVE TOTAL RETURN
BASED ON REINVESTMENT OF $100 BEGINNING DECEMBER 31, 1991

<TABLE>
<CAPTION>
MEASUREMENT PERIOD S&P
(FISCAL YEAR COVERED) HOUSEHOLD S&P 500 FINANCIALS
<S> <C> <C> <C>
12/91 $100 $100 $100
12/92 $121 $108 $123
12/93 $138 $118 $137
12/94 $162 $120 $132
</TABLE>

FIVE-YEAR CUMULATIVE TOTAL RETURN
BASED ON REINVESTMENT OF $100 BEGINNING DECEMBER 31, 1989

<TABLE>
<CAPTION>
MEASUREMENT PERIOD S&P
(FISCAL YEAR COVERED) HOUSEHOLD S&P 500 FINANCIALS
<S> <C> <C> <C>
12/89 $100 $100 $100
12/90 $ 67 $ 97 $ 79
12/91 $109 $126 $118
12/92 $132 $136 $146
12/93 $150 $150 $162
12/94 $177 $152 $157
</TABLE>

35
<PAGE> 39

TEN-YEAR CUMULATIVE TOTAL RETURN
BASED ON REINVESTMENT OF $100 BEGINNING DECEMBER 31, 1984

<TABLE>
<CAPTION>
MEASUREMENT PERIOD S&P
(FISCAL YEAR COVERED) HOUSEHOLD S&P 500 FINANCIALS
<S> <C> <C> <C>
12/84 $100 $100 $100
12/85 $135 $132 $143
12/86 $159 $156 $154
12/87 $138 $164 $128
12/88 $204 $191 $151
12/89 $232 $252 $201
12/90 $156 $244 $158
12/91 $254 $318 $238
12/92 $307 $342 $293
12/93 $349 $376 $325
12/94 $412 $382 $315
</TABLE>

The estimated compound annual total return (which is the stock price
appreciation that occurs over the period of time noted plus the value of
dividends paid to shareholders and reinvested over that same period of time) for
the past one, three, five and ten year periods for Household's Common Stock and
the noted indices was as follows:

1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ----------- ----------- -----------
(1994) (1992-1994) (1990-1994) (1985-1994)
<S> <C> <C> <C> <C>
Household.............................. 18% 18% 12% 15%
S&P 500................................ 1% 6% 9% 14%
S&P Financials......................... (3)% 10% 9% 12%
</TABLE>

OTHER BUSINESS

The management of Household knows of no business other than that stated in
this Proxy Statement which will be presented for action at its annual meeting.
If, however, other business should properly come before the meeting, the persons
designated as the Household stockholders' proxies will vote or refrain from
voting in respect thereof in accordance with their best judgment.

36
<PAGE> 40

The 1994 Annual Report was mailed to stockholders on or about March 14, 1995.
If for any reason you did not receive a copy of the report, another will be sent
upon request.

HOUSEHOLD WILL PROVIDE WITHOUT COST TO ANY HOUSEHOLD STOCKHOLDER A COPY OF
HOUSEHOLD'S REPORT ON FORM 10-K FOR ITS MOST RECENT FISCAL YEAR, WHICH HOUSEHOLD
IS REQUIRED TO FILE WITH THE SECURITIES AND EXCHANGE COMMISSION. WRITTEN
REQUESTS FOR THE REPORT SHOULD BE DIRECTED TO THE CORPORATE COMMUNICATIONS
DEPARTMENT, HOUSEHOLD INTERNATIONAL, INC., 2700 SANDERS ROAD, PROSPECT HEIGHTS,
ILLINOIS 60070.

1996 ANNUAL MEETING OF HOUSEHOLD STOCKHOLDERS

Proposals from stockholders to be presented at the 1996 annual meeting must be
received by Household on or before November 30, 1995, in order to be eligible
for inclusion in Household's proxy statement and form of proxy for that meeting.

37
<PAGE> 41

Appendix A

HOUSEHOLD INTERNATIONAL
EMPLOYEE STOCK PURCHASE PLAN

1. Purpose

The Household International Employee Stock Purchase Plan (the "Plan") is
intended to provide an opportunity to participate in the ownership of Household
International, Inc. (the "Company") for eligible employees of the Company and
such other companies ("Participating Companies") as the Compensation Committee
of the Board of Directors of the Company (the "Committee") shall from time to
time designate; provided that each such company shall qualify as a "parent
corporation" or "subsidiary corporation," as defined in Sections 424(e) and (f)
of the Internal Revenue Code of 1986 (the "Code"), on the first day of the
relevant Offering Period. After the initial effective date of the Plan, an
additional company to be included in the Plan must be designated as a
Participating Company by the Committee prior to December 31 in order for
employees of such company to participate in the next Offering Period. It is
further intended that the Plan shall qualify as an "employee stock purchase
plan" as defined in Section 423 of the Code, but shall permit offerings that do
not qualify under Section 423.

2. Administration

The Plan shall be administered by the Committee. The Committee is appointed by
the Board. The Committee shall have full authority to administer the Plan,
including authority to interpret and construe any provision of the Plan and to
adopt such rules and regulations for administering the Plan as it may deem
necessary or desirable. Decisions of the Committee shall be final and binding on
all parties who have an interest in the Plan. The Committee may authorize the
appointment of an agent to perform record keeping and other administrative
duties with respect to the Plan.

3. Effective Date and Term of Plan

(a) The Plan shall become effective when adopted by the Board of Directors
(the "Board"), but no Offering Period shall commence and no options shall be
granted under the Plan until the Plan has been approved by the Company's
shareholders. If shareholder approval is not obtained within twelve (12) months
after the date of the Board's adoption of the Plan, then the Plan shall
terminate.

(b) Unless terminated under Section 3(a) above, the Plan shall terminate at
such time as the Board shall designate, but in no event shall the Plan continue
beyond the date on which all shares available for issuance under the Plan shall
have been issued.

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<PAGE> 42

4. Offering Periods and Applicable Percentage

The Plan shall have one or more Offering Periods. Unless otherwise designated
by the Committee, each Offering Period will begin on July 1 and end on June 15
of the following year, or the next succeeding business day if June 15 is not a
business day in Chicago, Illinois. However, the Committee may declare Offering
Periods and the first and last day for each Offering Period as it deems
appropriate. Prior to the commencement of each Offering Period the Committee may
designate percentages which shall not be less than eighty-five percent (85%) nor
more than one hundred percent (100%) which will be used under Section 7(a) to
determine the option price for each Offering Period. Each Offering Period shall
run for a period specified by the Committee not to exceed two years; provided
however, the Committee may designate the final day of each Offering Period so as
to facilitate administration of the Plan. No two Offering Periods shall run
concurrently.

5. Eligibility and Participation

Each employee of the Company or any of the Participating Companies shall be
eligible to participate in the Plan during an Offering Period except (i)
employees who were not employed by the Company or a Participating Company on
December 31 of the calendar year prior to the first day of an Offering Period,
(ii) employees who customarily work less than twenty (20) hours per week, (iii)
employees whose customary employment is for not more than five months in any
calendar year, (iv) any one or more employees excluded in the sole discretion of
the Committee who are highly compensated employees as described in Code Section
423(b)(4)(D), and (v) at the discretion of the Committee in the case of an
offering that is not intended to qualify under Section 423 of the Code, any
employee not compensated on a salaried basis. All eligible employees may become
participants with respect to an Offering Period by executing such instruments as
the Committee may specify and delivering them to such persons and at such time
prior to the first day of that Offering Period as the Committee may specify.

6. Stock

The stock subject to the Plan shall be shares of the Common Stock of the
Company which may be acquired in open market transactions over securities
exchanges or newly issued or treasury shares. The aggregate amount of stock
which may be sold pursuant to the Plan shall not exceed two million (2,000,000)
shares (subject to adjustment as provided in Section 8).

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<PAGE> 43

7. Options

Options shall be evidenced by instruments in such form as the Committee may
from time to time approve, and shall conform to the following terms and
conditions:

(a) Option Price. The option price shall be the lower of (i) the price
determined by multiplying the Opening Percentage (which shall be eighty-five
percent (85%) unless otherwise determined by the Committee for an Offering
Period) by the fair market value of the Company's Common Stock on the first
day of the Offering Period, and (ii) the price determined by multiplying the
Closing Percentage (which shall be eighty-five percent (85%) unless otherwise
determined by the Committee for an Offering Period) by the fair market value
of the Company's Common Stock on the last day of the Offering Period. For the
purpose of determining the option price, the fair market value of the
Company's Common Stock on any day shall be the average of the high and low
prices (computed to four decimal places) as published in The Wall Street
Journal Report of the New York Stock Exchange-Composite Transactions for the
ten preceding trading days.

(b) Payment. Payment for stock under the Plan shall be from amounts
collected from participants through payroll deduction, plus any interest
credited thereto. However, in its sole discretion, the Committee may from time
to time designate alternative methods of collecting payment for stock under
the Plan. Under the payroll deduction method of payment, a participant may
participate at a fixed dollar amount per pay period, such amount not to exceed
fifteen percent (15%) of eligible compensation as of December 31 of the prior
year, or such other lesser amount as may be specified by the Committee for an
Offering Period. For purposes of this Section 7(b), eligible compensation
shall mean annualized base pay as of December 31, and, if applicable,
commissions earned during the calendar year preceding an Offering Period,
before reduction for elective contributions under a 401(k) plan, dependent
care assistance program qualified under Section 129 (or a successor provision)
of the Code or cafeteria plan qualified under Section 125 (or a successor
provision) of the Code, but not including bonuses, awards, overtime pay,
deferred compensation, expense reimbursements including, but not limited to,
car allowances or other contributions to or benefits under any other employee
benefit plan.

(c) Number of Shares. Subject to the limitations in Section 7(k) herein, on
the first day of any Offering Period, a participant shall be granted an option
to purchase up to a fixed number of shares of Common Stock determined as of
such date by dividing the total amount to be collected pursuant to Section
7(b) (not including interest to be collected thereon) by the closing price of
the Company's Common Stock as published in The Wall Street Journal Report of
the New York Stock Exchange-Composite Transactions on the first day of the
Offering Period and multiplying the result by one and one-half (1 1/2), or
such other constant number not to exceed one and one-half (1 1/2), as may be

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<PAGE> 44

specified by the Committee for an Offering Period. If the total number of
shares of Common Stock for which options are to be granted on any date in
accordance with the terms of the Plan exceeds the number of shares then
remaining available under the Plan (after deduction of all shares for which
options have been exercised or are then outstanding), the Committee shall make
a pro rata allocation of the shares remaining available in as near as uniform
a manner as shall be practicable and as it shall deem equitable. The Committee
shall give written notice of such allocation to each participant affected
thereby.

(d) Interest. Amounts collected from participants during an Offering Period
may accrue interest, if so determined by the Committee. The rate of interest,
if any, to be paid upon such collections will be established by the Committee
prior to each Offering Period and will be compounded monthly in each
participant's account.

(e) Termination of Employment. If prior to the end of an Offering Period, a
participant ceases to be employed by the Company or a Participating Company
for any reason, including death or retirement, the participant's option shall
terminate, and any amounts collected from the participant, together with any
interest thereon, shall be paid to the participant or the participant's
personal representative. Amounts collected from a participant who goes on a
leave of absence during an Offering Period will be applied, together with any
interest credited thereto, to purchase stock as described in Section 7(g).

(f) Termination of Option. A participant may, during an Offering Period,
terminate his or her option, by giving written notice to the Committee, in
such manner and at such time as the Committee may specify, and any amounts
collected from the participant, together with any interest thereon, shall be
paid to the participant and no further amounts will be collected during the
Offering Period.

(g) Exercise. Each option shall be exercised automatically on the last day
of the Offering Period, unless the option has been previously terminated
pursuant to 7(e) or 7(f). Any balance in the participant's account (including
interest) after purchase of shares under an option shall be promptly paid to
the participant. In the case of an offering that is not intended to qualify
under Section 423 of the Code, there shall be withheld from the number of
shares issuable to a participant that number of shares equal in fair market
value to the federal and state income and employment tax withholding
obligations with respect to the participant arising from such exercise, based
on the income and employment tax withholding rates in effect at the time under
federal and applicable state law.

Upon the purchase of shares underlying an option, the Company shall cause to
be promptly delivered to the participant a statement reflecting the status of
his or her account and, if requested in writing, the Plan Administrator, as
designated by the Committee, shall issue a stock certificate for full shares
held in the participant's account and a check for the fair market value of any
fractional shares

A-4
<PAGE> 45

then held in the participant's account. However, no stock certificates
representing newly acquired shares will be issued until the date shares are
eligible for sale as described in Section 7(j). The fair market value of any
fractional shares will be the sales price for such shares on the New York
Stock Exchange, which sale will occur as soon as administratively possible
following receipt of a request for issuance of a stock certificate.

(h) Assignability. Options under the Plan shall not be assignable or
transferable by the participant, and shall be exercisable only by the
participant.

(i) Rights as Shareholder. A participant shall have no rights as a
shareholder with respect to shares covered by any option granted under the
Plan until the option is exercised. No adjustments will be made for dividends
or other rights for which the record date is prior to the date of exercise.

(j) Sale Limitation. Upon exercise of an option, shares acquired under the
Plan may not be sold until July 1 of that year. However, prior to the start of
an Offering Period the Committee may establish an alternative date upon which
shares will first be eligible for sale, provided that such date will not be
more than three weeks following the date upon which options are exercised
under the Plan.

(k) Accrual Limitations. No option shall permit a participant to purchase
stock under all "employee stock purchase plans" (as defined in Section 423 of
the Code) of the Company or its "subsidiary corporations" (as defined in
Section 425(f) of the Code) which accrues at a rate that exceeds $25,000 of
fair market value of such stock (determined at the time such option is
granted) for each calendar year in which such option is outstanding at any
time, provided that options which are not part of an offering intended to
qualify as a qualified offering under Section 423 of the Code shall not be
subject to such limit and shall be disregarded in applying the limit to
options granted under qualified offerings. The Committee shall specify at the
beginning of each Offering Period whether the offering for such Offering
Period is intended to qualify under Section 423 of the Code.

No option shall be granted to an employee if the employee would own (within
the meaning of Section 424(d) of the Code), or hold outstanding options to
purchase, immediately after the grant, stock possessing 5 percent (5%) or more
of the total combined voting power or value of all classes of stock of the
Company or any of its subsidiary corporations.

(l) Payroll Adjustment. In order to comply with the limitation of Section
423(b)(8) of the Code as described in Section 7(k) hereof, a participant's
contributions to be allocated under the Plan to the purchase of stock may be
decreased to zero at any time during an Offering Period so that an employee's
aggregate contributions accumulated during a calendar year do not exceed
$20,040. The Committee may also establish a minimum contribution level for
participants which shall be $600 per

A-5
<PAGE> 46

Offering Period (unless otherwise determined by the Committee for an Offering
Period). Income tax and employment tax withholding will be made as applicable.

(m) Other Provisions. Instruments evidencing options may contain such other
provisions, not inconsistent with the Plan, as the Committee deems advisable.

8. Capital Adjustments

If any change is made in the Common Stock subject to the Plan, or subject to
any option granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, split-up, combination of
shares, exchange of shares, change in corporate structure, or otherwise),
appropriate adjustments shall be made as to the maximum number of shares subject
to the Plan, and the number of shares and price per share of stock subject to
outstanding options.

9. Amendments

The Committee may from time to time alter, amend, suspend, or discontinue the
Plan with respect to any shares at any time not subject to options; provided,
however, that no such action of the Committee may, without the approval of
shareholders of the Company, (i) increase the number of shares subject to the
Plan (unless necessary to effect the adjustments required under Section 8), (ii)
unless the Committee determines thereafter to grant only offerings that do not
qualify under Section 423 of the Code, change the class of companies eligible to
become Participating Companies, or (iii) make any other change with respect to
which the Committee determines that shareholder approval is required by
applicable law or regulatory standards.

10. No Employment Obligation

Nothing contained in the Plan (or in any option granted pursuant to the Plan)
shall confer upon any employee any right to continue in the employ of the
Company or any affiliate or constitute any contract or agreement of employment
or interfere in any way with the right of the Company or an affiliate to reduce
such employee's compensation from the rate in existence at the time of the
granting of an option or to terminate such employee's employment at any time,
with or without cause, but nothing contained herein or in any option shall
affect any contractual rights of an employee pursuant to a written employment
agreement.

11. Use of Proceeds

Cash proceeds received by the Company from the issuance of shares pursuant to
options under the Plan shall be used for general corporate purposes.

A-6
<PAGE> 47

12. Regulatory Approvals

The implementation of the Plan, the granting of any option under the Plan, and
the issuance of Common Stock upon the exercise of any such option shall be
subject to the Company's procurement of all approvals and permits required by
regulatory authorities having jurisdiction over the Plan, the options granted
under it or the Common Stock issued pursuant to it.

13. Governing Law

To the extent not otherwise governed by federal law, the Plan and its
implementation shall be governed by and construed in accordance with the laws of
the State of Delaware.

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<PAGE> 48

------------------------------
HOUSEHOLD INTERNATIONAL

Notice of 1995
Annual Meeting
of Stockholders
and Proxy
Statement
<PAGE> 49
HOUSEHOLD INTERNATIONAL
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. //

A vote FOR Items 1, 2, and 3 is recommended by the Board of Directors

<TABLE>
<S> <C> <C> <C> <C>
Withold
For for all
1995 1. Election of Directors. / / / /
Nominess: W.F. Aldinger, D.C. Clark, R.J. Darnall,
P G.G. Dillion, J.A. Edwardson, M.J. Evans, C.F. Freidheim, Jr.,
L.E. Levy, G.A. Lorch, J.D. Nichols, J.B. Pitblado, S.J. Stewart,
R L.W. Sullivan, R.C. Tower

O (INSTRUCTION: To withhold authority to vote for any individual
nominee, strike a line through the nominee's name listed above.)
X For Against Abstain
2. Approval of the Household International Employee Stock / / / / / /
Y Purchase Plan.
For Against Abstain
3. Ratification of Appointment of Arthur Andersen LLP as / / / / / /
Independent Auditors.
</TABLE>

THIS PROXY WILL BE VOTED IN ACCORDANCE
WITH SPECIFICATION MADE IF NO CHOICES ARE
INDICATED, THIS PROXY WILL BE VOTED FOR
ITEMS 1, 2 AND 3.

Your vote will be kept permanently confidential as described in the proxy
statement.

This card also provides voting instructions for shares of Common Stock held in
the Household Tax Reduction Investment Plan, if registrations are identical, as
described in the proxy statement.

Dated: , 1995
-----------------------------

--------------------------------------------------------------------------------
Signature

NOTE: Please sign exactly as name appears hereon. For joint accounts both owners
should sign. When signing as executor, administrator, attorney, trustee or
guardian, etc., please sign your full title.

<PAGE> 50
HOUSEHOLD INTERNATIONAL

PROXY/VOTING INSTRUCTION CARD FOR ANNUAL MEETING TO BE HELD MAY 10, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.

THE UNDERSIGNED HEREBY APPOINTS R.J. DARNALL, J.D. NICHOLS AND R.C.
TOWER, AND EACH OF THEM, TRUE AND LAWFULL PROXIES, WITH POWER OF SUBSTITUTION,
TO VOTE ALL SHARES OF COMMON STOCK AND/OR $6.25 CUMULATIVE CONVERTIBLE VOTING
PREFERRED STOCK OF THE UNDERSIGNED, AT THE ANNUAL MEETING OF HOUSEHOLD
INTERNATIONAL, INC. TO BE HELD MAY 10, 1995, AND AT ANY ADJOURNMENT THEREOF, ON
ANY BUSINESS THAT MAY PROPERLY COME BEFORE THE MEETING, INCLUDING: THE
PROPOSALS NOTED HEREIN, WHICH ARE REFERRED TO IN THE NOTICE OF 1995 ANNUAL
MEETING OF STOCKHOLDERS AND PROXY STATEMENT PROVIDED.

IMPORTANT--THIS PROXY MUST BE SIGNED AND DATED ON THE REVERSE SIDE.