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US households are still in financial distress, but that may be easing

Created: On May 24, 2011 @ 5:51 pm In

Consumers in the U.S. are still in financial distress, but their overall financial situation seems to be improving. The [1] CredAbility Consumer Distress Index tracks the financial condition of the average U.S. household each quarter. CredAbility, a nonprofit credit counseling firm, measured employment, housing, credit, how households manage budgets and net worth.

Index score rises

U.S. households had a score of 68.1 on a 100-point scale in the first quarter of 2011, which was up from 67.2 the previous quarter. It was the highest score since the financial crisis escalated in the third period of 2008. A score below 70 indicates that households are experiencing financial distress.

Debt management

However, many consumers are getting their acts together and improving their finances. For instance, many people are doing better at managing their household budgets. They also are showing some improvement in debt management, reflected in the fact that there were fewer [2] bankruptcy filings, which fell 6 percent from the year-earlier quarter.

“The good news is that the full-time labor force grew by more than 540,000 people in the first quarter and consumers with stable incomes have a handle on their credit and household budgets,” said Mark Cole, chief operating officer for CredAbility and author of the report. “While the housing category continues to deteriorate, a gain of four points in the index during the past five quarters indicates that the majority of consumers are on the right track.”

Distressed southern states

Some areas of the country fared better than others. North Dakota (82.35) and South Dakota (81.23) were the states with the highest individual scores. Overall those two states have not been hit as hard by the economic crisis as some other parts of the country. Six states in the Southeast were among the 10 most distressed states in the country.

Help for your household

If you find yourself feeling overly stressed by credit card debt and other bills, it may be time to get help with debt. Consider finding a reputable [3] debt counseling firm to work with you to better manage your household budget.

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URL to article: http://www.debthelp.com/blog/2011/05/24/us-households-are-still-in-financial-distress-but-that-may-be-easing/

URLs in this post:
[1] CredAbility Consumer Distress Index: http://www.credability.org/en/about-credability/media-center/press-releases/consumer/CredAbility-Con

[2] bankruptcy: http://www.debthelp.com/bankruptcy/
[3] debt counseling: http://www.debthelp.com/debt-consolidation/credit-counseling.html