According to a report drawn from data made available by the U.S. Census, the Bureau of Labor Statistics, and the Federal Reserve, the American middle class is less prepared for a financial emergency now than at any time in the last thirty years.

The report studied the middle 60 percent of American households, those earning between $18,000 and $88,000 a year. As of 2004, only 28.8 percent of the households in this group could sustain themselves over a three month period of unemployment, only 22.3 percent could handle the average $3,013 cost of a "minor" medical emergency, and just 18.3 percent had accumulated savings equivalent to three months of income. The corresponding figures for 2001 were 39.2 percent, 35 percent, and 29 percent, respectively. There has clearly been a considerable drop over just three years.

The authors of the study attribute this decline in emergency preparedness to stagnant wages, soaring costs for housing, college and health care, and rising consumer debt. Consumer debt has, in fact, increased $5.2 trillion since 2001. In June 2006, American middle class households took on consumer debt equal to 129 percent of their disposable incomes, as opposed to 96 percent just five years before.

Read the article at the link below for more details. There are lots of other goodies at this link, including online tools such as a "Debt Evaluator", strategies for "saving more and spending less" and, inevitably, the so-called "readers' comments", which run the gamut from the sympatico to the shrill.

"Middle class living on the edge?" from MSN.com