A middle-class standard of living requires that families have adequate financial security to meet current obligations, invest in the future, and access opportunities. The Middle Class Security Index, created by Demos and the Institute on Assets and Social Policy at Brandeis University, focuses on five interrelated factors that in combination describe the security or vulnerability of middle-class families—assets, education, housing, budget and healthcare. For each of these factors measured by the Index, researchers established an optimal threshold for overall financial security as well as one for economic vulnerability. This brief outlines the 2008 findings from the Middle Class Security Index which show that between 2000 and 2006--even before the 2008 Recession --the economic well-being of middle-class families slipped noticeably. Between 2000 and 2006 an estimated 4 million middle-class families lost their financial security, bringing the total number of middle-income families on shaky ground to 23 million. 


Between 2000 and 2006--

  • The median financial assets held by middle-class families declined by 22 percent. This means that for every dollar in median assets that middle-class families held in 2000, they held just 78 cents in 2006. These figures do not include home equity and therefore do not reflect additional losses families may have experienced due a decline in their home values.
  • Monthly housing expenses for the middle class rose by 9 percent. As a result, the percentage of middle-class families who match the Department of Housing and Urban Development’s definition of housing burdened rose from 31 percent in 2000 to 37 percent in 2006.
  • The number of middle-class families in which at least one member lacks health insurance grew from 18 percent in 2000 to 25 percent in 2006.