By David Connell

An exclusive chat with Katie Couric on NBC's Today Show couch, a frank and in-depth discussion with Michelle Norris on NPR's All Things Considered, reviews in the New York Times and coverage in the New Yorker—it's the type of treatment usually reserved for a great writer of literary import or the latest geo-political tome. However, last month it was the new financial planning book—The Two-Income Trap: Why Middle-Class Mothers and Fathers are Going Broke—that was garnering all the attention.

A hard look at the middle class
To be fair, The Two-Income Trap is more than just a financial planning book. It's an in-depth look at the struggle to maintain a middle-class living. And with one of its authors being a Harvard professor, the attention is definitely warranted.

But what really makes this book hotter than Harry Potter is the incredible theory it puts forth: that women, especially mothers who have entered the workforce to help secure their family's future, are actually creating a dire financial situation. The authors assert that, with Mom working, there is twice the risk a major income stream will be cut off through layoffs, sickness or disability, leaving no backup wage earner (i.e., the stay-at-home mom) to pick up the slack.

The authors (ironically a mother-daughter team consisting of Harvard's Elizabeth Warren and financial analyst Amelia Warren-Tyagi) contend that this financial "trap" is largely responsible for an explosion in personal bankruptcy filings and other grave financial problems. And they have the statistics to back it up:

• In the last 20 years, the number of women filing for bankruptcy has increased by 662 percent.
  
• Mothers are 35 percent more likely than childless homeowners to lose their home, and three times more likely than men without children to go bankrupt.
  
• More people will go bankrupt this year than will suffer a heart attack, be diagnosed with cancer or graduate from college.
  
• Approximately 90 percent of those who go bankrupt this year will be considered middle-class.

These staggering numbers, the book maintains, are not the result of frivolous middle-class spending, but rather due to a failing system that has limited the availability of decent school districts and thus driven up property values in those districts. Middle-class parents who want to send their children to the best schools must either pay a premium for their house, and in some cases pony up exorbitant property taxes, or pay tuition to private schools. Add to this the day care and after-school care costs working mothers must pay—not to mention looming college tuition—and working mothers begin to cost more than they bring in.

If financial disaster strikes and a parent loses a job, the walls cave in and bankruptcy may soon become the only answer. In her NPR interview, Warren likened the scenario to a racecar throttling down the track, striking a stone and losing control. In the book it's stated even more dramatically:

The people who consistently rank in the worst financial trouble are united by one surprising characteristic. They are parents with children at home. Having a child is now the single best predictor that a woman will end up in financial collapse.

Approximately 90 percent of those who go bankrupt this year will be considered middle-class.

The financial fire drill
While the authors suggest several solutions for dismantling this trap—ranging from increased federal voucher programs, to college tuition freezes and child-based tax breaks—they also advocate specific personal planning measures to avoid bankruptcy.

Warren outlined this program specifically on Today and All Things Considered saying that families should conduct a "financial fire drill" by eliminating one wage earner and examining their financial situation to decide how—or if—they could cut back on expenses.

She also stated that, for families who run into financial problems and are facing creditors, immediately cutting back on those "frivolous" expenses such as new shoes, clothes and sporting equipment for the kids may not be enough. These relatively small, one-time purchases are minor when compared with real income killers like the mortgage, tuition payments, car payments and the like.

Instead, Warren suggested families organize their monthly creditors into those they value the most and paying bills in that order. If, for example, their kid's college tuition is more important to them than their mortgage, they should make the tuition payment before the mortgage payment.

Two Post columnists to watch
As a final piece of suggested reading for October, "Media Watch" would like to recommend two Washington Post columnists.

The first is Stan Hinden, an occasional columnist who writes about senior issues, in particular retirement planning. He's eminently qualified for this position because he's actually retired. Hinden’s most recent column on the perils of term insurance and the wisdom of whole life insurance is called "Insurance Demands a Long-Term Perspective." The Post also keeps a running archive of his columns on its website.

We also recommend Michelle Singletary's "Color of Money" column. Singletary's columns are perfect for clients who need reminders about family finances. They concentrate on practical matters like debt management, college savings and preparing for special events like weddings.

Other links
To read an excerpt of The Two-Income Trap: Why Middle-Class Mothers and Fathers are Going Broke, visit the Today Show website

To listen to the Elizabeth Warren interview on All Things Considered visit National Public Radio

The New York Times and The New Yorker have also written on The Two-Income Trap.

To purchase the book visit Amazon.com

Am I missing something? Did you read an essential story on investor confidence? Is Law and Order sticking it to the insurance industry again? Have you read a book that deals with the financial services industry? Is this a poorly written column and a disgrace to the industry? Sound off on "Media Watch" by emailing your thoughts to David Connell.

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