In debt, out of work and living with Mom

"It's hard to say it, but it's demeaning," said McAuliffe, who has had a handful of job interviews in the last month. "You work so long to make your parents proud, and this is the last thing you expect to be doing at my age."

Ray of hope

Few experts predict that younger workers face a dire long-term financial future, and not everyone is suffering. Some say younger workers may weather the uncertainty of economic downturns well because they're accustomed to changing jobs frequently.

The housing crisis might even open up opportunities.

"The bright spot is that younger people who didn't buy a house in the last few years and who have some cash can get into the housing and stock markets" for the first time in years, said Boston University economist Laurence Kotlikoff.

Although there are few reliable statistics on how many among younger home buyers are dealing with foreclosure, some economists believe they are bearing the brunt of the housing downturn. The explosion of sub-prime loans coincided with many first-time buyers with poorer credit histories entering the market.

Edward Wolff, an economist at New York University who studies generational wealth differences, worries that many younger people could accumulate even more debt in this downturn on top of outsize college loans, credit card balances and mortgage payments.

"It's not a doomsday scenario," Wolff said. But younger people "are stretched thin and don't have as much to fall back on."

Time running out

Dulce Maya is worried that she won't be able to squeeze by much longer. The 27-year-old restaurant manager bought a three-bedroom, two-bath house in Fontana for $350,000 two years ago with a $5,000 down payment and an adjustable-rate mortgage.

This year, her $2,300 monthly payment will probably rise to $3,300 and her work hours were recently cut because business is slow. Maya has asked her bank to lower her payments so she can keep her house, which is now valued at $200,000, and expects to hear back in the next few weeks. If it doesn't agree, she says, she may have no choice but to hand the bank the keys.

"I don't know what happens next," Maya said. "I may try and rent an apartment for around what I'm paying, but rents are going up too."

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daniel.costello@latimes.com