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With combined yearly earnings of about $20,000, they have cut their spending to the bone and make ends meet with food stamps and credit cards. "We had about $40,000 in savings, but we spent that a long time ago," Ms. Sullivan said. "Now we owe more money in credit card bills than I ever would have believed possible. We don't spend money on anything at all that isn't a complete necessity. Your whole way of thinking changes. The other day I was so excited: I got a credit card offer for a new card that will give us a long period with zero percent financing."

How in the world are they buying only necessities? I think they don't know the difference between a need and a want, because I have lived on far less than that. Not that recently, but I have done it. Yesterday I "needed" a Gamecube because it came with all the Zelda games. I really, really "needed" it.

My husband was also laid off early this year. We were firmly in the middle class, and since we had bought our house only a year before, we had no savings. We sold our house and moved across the country to where he found a good job. It cost us large amounts of money to move. For about six months this year, one of us was out of work (I had to find a job after we moved). We racked up NO credit card debt, and now, since we have moved to a cheaper part of the country, we are financially much better off.

I think they don't know the difference between a need and a want, because I have lived on far less than that.

I quite agree. A few years ago, my sister was living in Chicago on about $10K per year - and saving money. Newsflash: movies, dining out, video games, Mercedes Benzes ... not necessities.