Mark Cole, chief operating officer of CredAbility, says that net worth is a "ticking time bomb," as many Americans over the age of 50 have less time and opportunity to recover financially from the recession. The average jobless spell for Americans over the age of 55 lasts longer, and new jobs may pay less.
The organization measures consumer distress, or the financial picture for the average American family, on an index from 0 to 100. This quarter, Americans are making some modest gains, with the overall index score at 68.1, up from 67.2 in the fourth quarter of 2010. But any score below 70 indicates financial distress. The scale measures five categories: employment, housing, credit, household budget management, and net worth.
Several factors have raised the overall score: more full-time and part-time employment, better handling of household budgets, and smart use of credit, according to the report.
For states in the West and Southeast, a weak housing market and high unemployment continue to make life difficult for the average household. States that have been especially hard hit by foreclosures, including Florida, Arizona and Nevada, are among the top five most distressed states.
North Dakota is the least distressed state, followed by South Dakota, Wyoming, Nebraska and Alaska. Cole says that these states have more stable industries and unemployment rates are lower. Strong community stability and low population sizes also have served to buffer consumers. "It's a different lifestyle," he says of states that are least distressed.
Catherine New is a reporter with the Huffington Post Media Group.