• Russia;
  • financial crisis;
  • household welfare;
  • safety net;
  • panel data.

We compare welfare indicators for a nationally-representative sample of Russians interviewed shortly after the 1998 financial crisis with data on the same people two years earlier. Both objective and subjective measures reveal a widespread, though not universal, deterioration in welfare. Current expenditures generally contracted more than incomes. Inequality fell. There were both gainers and losers at all levels. The safety net's response fell far short of what was needed to protect living standards, but it did help prevent even greater poverty. Even without better targeting, a modest expansion of the safety net could have prevented an increase in income poverty in the aftermath of the crisis.