Your Latte Isn’t Why You’re in Debt, and the People Who Say It Is Are Lying to You

shadowwood:

deducecanoe:

onionhighonionandrenown:

flange5:

Warren and Tyagi demonstrated that buying common luxury items wasn’t the issue for most Americans. The problem was the fixed costs, the things that are difficult to cut back on. Housing, health care, and education cost the average family 75 percent of their discretionary income in the 2000s. The comparable figure in 1973: 50 percent. Indeed, studies demonstrate that the quickest way to land in bankruptcy court was not by buying the latest Apple computer but through medical expenses, job loss, foreclosure, and divorce.

Giving up a latte or another such small extravagance in this environment wasn’t going to be enough. Yet the personal finance shills continued to tell people their problems were mostly of their own making.

This strikes me as being directly related to those jackholes who are enraged when someone poor has some small or relatively small luxury: they think this is how economics work.

I’m tired of feeling guilty for every tiny indulgence that makes me feel human.

This makes me remember a story a friend of mine told me.

He was in a college course for learning financial stuff, like how to invest wisely and shit like that because he was working for the local library system in their accounting department and had to be able to advise employees on how best to use the new investment options the library was offering.

So, the professor tells the class that they should ALWAYS be saving at least $25 per paycheck into a savings account even when it’s hard because that is the only way to get into the habit of saving and also the quickest way to having emergency cash, but it was better to do at least $50.

Not terrible advice, certainly, but… My friend said there was no way he could do that. The professor scoffed at him about high dollar luxuries like coffee shop drinks or name brand food or clothes or a computer or using the bus instead of a car.

Now, my friend did not own a car; he bike rode everywhere. His wife used the bus. Both he and his wife worked. He did not buy name brand food; he got cheap store brand food in bulk and only bought what he already knew would be used in his meal calendar planned for two months at a time. He brewed his own coffee at home. He kept his electricity usage to a minimum and taught his wife and children to do the same. His kids weren’t indulged with sweets or many toys. They didn’t buy candy or hobby items. They got the free local TV channels which they honestly only used to track weather on a salvaged TV they got from a friend. They only got new clothing when their kids grew out of the old or something of theirs was too worn to patch or repair and always from thrift shops. All their furniture was secondhand and usually picked cheap from garage sales. They made the agonizing decision to purchase a home instead of renting because the net savings over all were justifiable because the house payments were cheaper than renting. They budgeted for a total of ten dollars to be put in the savings account per month, not per paycheck.

My friend and his wife planned their expenditures down to the cent at least two months in advance to make sure they could make it. They constantly researched to find the absolute best value of every item they bought. Thankfully, my friend had the analytical mind for that kind of planning. No purchase ever went unremarked upon or without heavy consideration, no matter how small. They spent wisely and stretched every dollar as far as it could go.

My friend brought in a hand written copy of his budget (because he didn’t have a computer or printer and paper was an expense he built into the budget so he could do the planning) and showed it to the professor the next day in front of the class and asked, “Where do I squeeze out $25 per paycheck?”

The professor hemmed and hawed as he went through the budget. He kept starting to say something on one line or another and then would stop himself and go to the next. Sometimes he would say shit things like “where is your gas column?” “We don’t own a car.” He spent about twenty minutes staring at my friend’s carefully planned and managed budget and could not see a single place where it could be improved.

“I guess you can’t,” the professor said and was apparently so bitter about being wrong that my friend had to keep from laughing at him even though the entire experience had soured him something awful.

People who are not struggling do not understand how money works for poor people and just assume we are horrible at managing it instead of realizing we just don’t have any. Luxury items aren’t killing us; low wages and a shit economy are.

bruddabois:

hoodoodyke:

kiriamaya:

sovietcop:

basically anyone who really shames people for buying their kids shoes or for buying themselves a manicure while poor doesnt understand poverty

poor people often have a lot of disposable income, more than you think, cause they live on cash

they often do not have any means of transforming that cash into assets or into longterm wealth

so yes i had a lot of toys and nice things as a poor kid because you can buy toys at the dollar store too

and like you can pay a lady 10 dollars in cash to do your nails professionally

but you really cannot scrimp, at least not anymore (maybe decades ago you could) to buy yourself a house or to invest in stocks or other things that guarantee financial protection

poor people are liquid- thats why they may have material goods including nice cell phones but they broke ass will always be broke

hell, even banks and financiers EXPLOIT the liquidity of poor people; cash advance places in the hood and the proven empirical facts that cash deposits from banks in low-income neighborhood go towards major investments and are used as liquid assets by big businesses

keeping poor people in cash and banks in poor neighborhoods are major transfers of wealth in this economy

so please spare me your policing of some lady who decided to get some shoes

Always reblog

It’s back

http://www.nytimes.com/2014/05/01/business/economy/changed-life-of-the-poor-squeak-by-and-buy-a-lot.html

Basically, the working poor can afford small pleasures but cannot afford massive shifts in their situations (like moving out your old neighborhood) cus the cost would cripple them.

thatdiabolicalfeminist:

Being poor is just a series of emergencies.

Emergencies really do crop up more often for poor people. Necessities, like vacuum cleaners or phones or bedding or shoes, need replacement or repair more often when you only buy the cheapest possible option.

Poor people’s health tends to be compromised by cheap, unhealthy food; stress; being around lots of similarly-poor contagious sick people who can’t afford to stay home or get treatment; inadequate healthcare; and often, hazardous and/or demanding work conditions.

So we get sick more. On top of that, many people are poor specifically because of disability. All of that is expensive – even if you just allow your health to deteriorate, eventually you can’t work, which is – say it with me – expensive.

When you’re poor, even the cheapest (most temporary) solution for an emergency often breaks the bank. Unexpected expenses can be devastating. People who aren’t poor don’t realize that an urgent expense of thirty dollars can mean not eating for a week. Poor people who try to save find our savings slipping away as emergency after emergency happens.

I don’t think people who’ve never been poor realise what it’s like. It’s not that we’re terrible at budgeting, it’s that even the most perfect budget breaks under the weight of the basic maths: we do not have enough resources.

Cos we’re fucking poor.

sabot-sister:

withasmoothroundstone:

pullthepillarsdown:

eatprayvalkyrie:

kaijuvsgiantrobotsvsme:

ripplesfromawaterlily:

fuck-me-barnes:

tessalynn:

A snippet from an article on Huffington Post about what it means to be working poor.

Pretty spot on…

I got into an argument today with someone who is a landlord, and they were outraged, outraged, to find that their evicted tenants owned an Xbox 360. Never mind that the console was ten years old and worth perhaps $50 on Craigslist, they were outraged that their evicted tenants did not sell it, along with the very clothes on their back, to pay their back rent. I tried to explain to him that when you are $1800 in back rent, $50 isn’t even a dent in that debt. Why bother? Why bother selling that $50 item if it isn’t going to get you any less evicted? If it’s not going to save you, you’ll hold on to it. Money becomes meaningless when you’ll never have enough to hold onto. You just let it flow like water through your hands. It’s all gone anyways, no matter what you do. It was gone before it ever touched you.

The other day I got very mad at someone because their justification of why a family didn’t deserve their council house was because they had decorated the front of their house with xmas lights. DO YOU REALLY KNOW WHAT ITS LIKE TO LIVE WITH NO SMALL PLEASURES AT ALL?!?!? DO YOU REALLY?!?!

This is one of the great end results of capitalism: we treat people as if the only thing they should care about are their mechanical needs but without things to nourish the soul or the capacity to talk about same, we fall apart.

We aren’t meant to be things which sit in blank boxes waiting to be used by our employers. Nothing in nature acts that way. Nothing’s meant to.

The source article: ”This Is Why Poor People’s Bad Decisions Make Perfect Sense”

#um this topic makes me fucking furious #i will do a murder immediately #don’t #not only are small pleasures necessary to keep from SPIRALING INTO DEPRESSION WHEN YOU ARE POOR but they are STATUS MARKERS #you NEED a fucking phone to get a job #you need a fucking SMARTPHONE to be accepted as a normal person #you need nice clothes to be treated like you’re worth something #especially if you’re a poor poc #everyone sit down #think about this if you haven’t before #smashes a vase #fuck capitalism

The need rich people have for poor people to constantly perform some sort of Dickensian display of abject poverty is so goddamn disgusting and proves that, yes, it is all about status markers. Rich people want visible proof that others are beneath them. It’s malicious and nauseating. And the kicker is that they’re usually too busy being impressed with their own wealth and sense of superiority to use their brains, because as already stated in the other comments, having technology or a couple of small pleasures is *not* a reliable indicator of income. This anti-poor people shit is revolting.

And it turns poor and working-class people against each other. Like I knew a guy who installed cable TV for a living and barely could make a living, and resented that some people who got cable TV were on welfare. I tried to explain that you actually have to spend a certain amount of money in order to qualify for such basic thing as Medicaid – if you save money you’ll get thrown off the system, even though you won’t magically be able to survive outside the system with the amount of money you have to save in order to be thrown off it. He didn’t care. He told me poor people should be given nothing more than food, clothing, and shelter. He grew up poorer than most poor people have ever been. All this combination of shit made me furious and still does. Not to mention the cultural ideals of being too proud to accept help of any kind and how people think this is a good thing even when it kills people.

The poorest people in the world forgo some amount of necessities for staying alive in order to have some money for recreation or things that connect them to the world. During the Depression, many people surveyed said they would rather give up their beds than their radios – radio being how people stayed connected to the outside world in the same way Internet does today. And does anyone need to bring up Rat Park again? Holy crap this stuff pisses me off.

(– Poor person who has Internet & Netflix & smartphone & other so-called luxuries. And does anyone really think the extra $100ish a month I’d get giving all that up would catapult me out of poverty and solve all my problems? Not to mention the Internet has literally saved my life before. As in, I was in the hospital being mistreated in a way that was life-threatening, and blogging allowed me and another poor person who was making decisions for me, to get other people to call the hospital and say “We’re watching you.” Other poor people get food and rent and etc. money by asking on the Internet and receiving food money through the Internet. Many people on disability supplement their income by selling art or small crafts online – how much you’re allowed to sell before they start cutting benefits depends on what part of the system you’re in, but it’s a common thing.)

god it drives me crazy when middle class and rich people don’t get that. why do you want everyone to be miserable all the time.

misslucy21:

revolutionarygays:

i hate so much when rich people claim they could live on minimum wage

you can’t. you absolutely fucking can’t.

it’s not just about how literally impossible it can be or how the rich are so accustomed to luxury they wouldn’t be able to stomach being poor – it’s about the fact that any experience rich people have had with poverty was temporary.

“to prove that $8/hr is humane i lived on minimum wage for a month – and it was fine. you just have to spend wisely and be frugal.”

i promise any rich person who’s done (if they even have) something like that was ACHING by the end of that month. that week. they were edging out the end of that month thinking “after this i can go back to my cozy $100k a year, i just have to get this month over with”

it’s livable, right? this guy proved it. one month and he’s sure – it’s totally doable! he ate gross food and kept his lights off and his AC off and scrounged up change for gas for a month and it wasn’t THAT bad!

but man…. imagine if that was your whole life.

i’m sure they felt a little stressed after realizing how tight the budget was at the end of that month… imagine that but for years. years and years with no end in sight. you never have the relief of going back to your $100k salary and flat screen TV. it’s years upon years of pent up stress and anxiety

what if your car breaks down? what if you miss your bus? what if you have an unexpected charge on your card and overdraft? what if the kids want pizza? what if you call out sick from work? what if you can’t afford christmas presents?

and on top of the stress, you’re poor and you don’t have much free time because you take all the hours you can get to make ends meet. instead of cooking you have to eat shitty banquet and michelinas meals because delivery and takeout are too expensive. and the more tired you get, the more exhausted, the more shitty food you consume just to try to keep going.

and you probably don’t have good healthcare!

you’re stressed, you’re eating poorly, your body hurts from all the work and you’re too poor to pay for medical help, things like car repair fall by the wayside in order to provide, you’re sad, you start drinking to cope, etc

this is the cycle poor people are fucking trapped in. this is why the minimum wage is a fucking failure to all impoverished people in america.

this is the toll “just being frugal” takes on poor people after living for decades like that. adddiction, mental illness, lawbreaking – these things are associated with low class and poor people because it’s what happens to us and what we resort to when the system fails us.

Also, consider start up costs. If you are purposefully living on minimum wage to “prove a point”, you probably have things like decent pots and pans for cooking. Or pantry stuff like spices, etc. Or, laundry facilities in your home, which is a huge, huge time and money saver. Like, I can’t explain how much that makes a difference. Or an actual decent house that doesn’t need repairs in ways that make it more difficult to do day to day life (like, good functioning plumbing or screens in good repair, or light fixtures that work right). All of those things are going to make it easier to get by with minimum wage money. Plus, things like insurance are plain cheaper when you have more money, so less is coming out of a paycheck for premium payments (by percentage if mot actual cash). Or copays are less. Etc.

The point is, trying some sort of challenge to “see what it’s like to be poor” just doesn’t take into account of all the things beyond the paycheck or the food stamp budget or whatever. There are a ton of nuances and things that people don’t realize unless it’s something they have lived or have close experience with through family, etc.

love-bites-but-so-do-i:

scaredofsheep:

love-bites-but-so-do-i:

love-bites-but-so-do-i:

You know what? I want to give a shoutout to a specific type of poor person we never hear about enough: the poor person who “isn’t poor enough.”

Shoutout to to the poor people who:

-Can’t afford to feed their families all the time but don’t qualify for food stamps

-Can’t afford college but don’t qualify for loans or discounts

-Can’t afford to pay rent but don’t qualify for low income housing

-Can’t afford hospitals or dentists but don’t qualify for most insurance policies for poor folk

-Who are always being told they aren’t “really poor” and “don’t have it that bad” because they don’t qualify for all of these things

-Who aren’t listened to because they’re experiences “don’t count” as a poor person’s experience.

-Who have nice things, proof they aren’t “really poor,” even though they aren’t that nice really and were either a gift or something they got at a garage sale or thrift store or whatever (meaning they didn’t pay much for it)

There’s more faces to being poor than people know, especially in the Western world. Poor people don’t all look like they’re starving and homeless and all of that. Sometimes poor people don’t look that poor at all to an outsider.

And those poor people need to be heard too. Those poor people need to be helped and protected too.

Because any kind of poor isn’t ok. No one should ever have to be poor in such a rich society, even if it’s only barely.

I feel really bad that so many people related to this post but I’m glad so many are standing up and saying that they will be there for anyone who related to this.

Thank you, you wonderful person.

You’re welcome. Believe me, you’re not alone.

withasmoothroundstone:

pullthepillarsdown:

eatprayvalkyrie:

kaijuvsgiantrobotsvsme:

ripplesfromawaterlily:

fuck-me-barnes:

tessalynn:

A snippet from an article on Huffington Post about what it means to be working poor.

Pretty spot on…

I got into an argument today with someone who is a landlord, and they were outraged, outraged, to find that their evicted tenants owned an Xbox 360. Never mind that the console was ten years old and worth perhaps $50 on Craigslist, they were outraged that their evicted tenants did not sell it, along with the very clothes on their back, to pay their back rent. I tried to explain to him that when you are $1800 in back rent, $50 isn’t even a dent in that debt. Why bother? Why bother selling that $50 item if it isn’t going to get you any less evicted? If it’s not going to save you, you’ll hold on to it. Money becomes meaningless when you’ll never have enough to hold onto. You just let it flow like water through your hands. It’s all gone anyways, no matter what you do. It was gone before it ever touched you.

The other day I got very mad at someone because their justification of why a family didn’t deserve their council house was because they had decorated the front of their house with xmas lights. DO YOU REALLY KNOW WHAT ITS LIKE TO LIVE WITH NO SMALL PLEASURES AT ALL?!?!? DO YOU REALLY?!?!

This is one of the great end results of capitalism: we treat people as if the only thing they should care about are their mechanical needs but without things to nourish the soul or the capacity to talk about same, we fall apart.

We aren’t meant to be things which sit in blank boxes waiting to be used by our employers. Nothing in nature acts that way. Nothing’s meant to.

The source article: ”This Is Why Poor People’s Bad Decisions Make Perfect Sense”

#um this topic makes me fucking furious #i will do a murder immediately #don’t #not only are small pleasures necessary to keep from SPIRALING INTO DEPRESSION WHEN YOU ARE POOR but they are STATUS MARKERS #you NEED a fucking phone to get a job #you need a fucking SMARTPHONE to be accepted as a normal person #you need nice clothes to be treated like you’re worth something #especially if you’re a poor poc #everyone sit down #think about this if you haven’t before #smashes a vase #fuck capitalism

The need rich people have for poor people to constantly perform some sort of Dickensian display of abject poverty is so goddamn disgusting and proves that, yes, it is all about status markers. Rich people want visible proof that others are beneath them. It’s malicious and nauseating. And the kicker is that they’re usually too busy being impressed with their own wealth and sense of superiority to use their brains, because as already stated in the other comments, having technology or a couple of small pleasures is *not* a reliable indicator of income. This anti-poor people shit is revolting.

And it turns poor and working-class people against each other. Like I knew a guy who installed cable TV for a living and barely could make a living, and resented that some people who got cable TV were on welfare. I tried to explain that you actually have to spend a certain amount of money in order to qualify for such basic thing as Medicaid – if you save money you’ll get thrown off the system, even though you won’t magically be able to survive outside the system with the amount of money you have to save in order to be thrown off it. He didn’t care. He told me poor people should be given nothing more than food, clothing, and shelter. He grew up poorer than most poor people have ever been. All this combination of shit made me furious and still does. Not to mention the cultural ideals of being too proud to accept help of any kind and how people think this is a good thing even when it kills people.

The poorest people in the world forgo some amount of necessities for staying alive in order to have some money for recreation or things that connect them to the world. During the Depression, many people surveyed said they would rather give up their beds than their radios – radio being how people stayed connected to the outside world in the same way Internet does today. And does anyone need to bring up Rat Park again? Holy crap this stuff pisses me off.

(– Poor person who has Internet & Netflix & smartphone & other so-called luxuries. And does anyone really think the extra $100ish a month I’d get giving all that up would catapult me out of poverty and solve all my problems? Not to mention the Internet has literally saved my life before. As in, I was in the hospital being mistreated in a way that was life-threatening, and blogging allowed me and another poor person who was making decisions for me, to get other people to call the hospital and say “We’re watching you.” Other poor people get food and rent and etc. money by asking on the Internet and receiving food money through the Internet. Many people on disability supplement their income by selling art or small crafts online – how much you’re allowed to sell before they start cutting benefits depends on what part of the system you’re in, but it’s a common thing.)