While the current recession has affected nearly every household in the United States, evidence shows that the economic crisis has been particularly severe for our country’s most vulnerable groups: children, the elderly, and the poor, practically erasing decades of improvement in material well-being.

The American Life Panel (ALP) and the Health and Retirement Study (HRS), along with support from the National Institute on Aging and the Social Security Administration, have enhanced collected data through a series of surveys. They asked households about their financial situations through areas such as spending behavior, retirement plans, and other areas affected by the recession. Michael Hurd and Susann Rohwedder of the RAND Corporation performed analysis’s showing profound effects the economic crisis had on the majority of households in America with a little over 70 percent of those ages 40 and up feeling that they had been affected “a little” or “a lot.”

Researchers focused on households that were suffering immediate financial distress, or that that fell into the categories of being more than two months behind on mortgage payments, having negative equity on their homes, foreclosure, or being unemployed or having an unemployed spouse.

Ten to 15 percent of homeowners over 40 years of age found themselves affected in one of these categories between November 2008 and January 2010, varying across demographic and socioeconomic groups. While wealthy and older homeowners experienced less financial distress than low-income and younger homeowners (40 to 64 year olds), the probability of delayed retirement increased. Older homeowners (65 years old and older) also reported less negative home equity issues (4 percent) than younger homeowners (9 percent).

By delaying retirement, these households reduce losses in retirement savings. Data from 2008 to 2009 from the Health and Retirement Study (HRS) suggests that a growing portion of the population of older Americans will delay retirement. About 65 percent of workers ages 50 to 61 expect to still be in the workforce full-time by age 62, according to the results from the 2009 HRS Internet Survey. Over 55 percent of workers ages 50 to 64 expect to be working full-time by the age 65, increasing from the numbers reported in 2008.

Richard Johnson of the Urban Institute reported that the number of unemployed people ages 55 and older more than doubled from November 2007 to August 2009, making it a historic high in this age group. Due mainly to the rise in labor force participation for that group, more older Americans are finding themselves unemployed, likely an effect of concerns with inadequate retirement benefits and declines in defined benefit pension plans.

The combination of this data shows that the impact of the recession on American families will continue to effect them well into 2011 and beyond. And while the National Bureau of Economic Research will likely declare the recession over by the end of 2010, many American households will bear the weight of continuing burdens.

Written by Kelly Mellott