My last post on this subject a few days ago raised a few objections that made me realize I glossed over a few key points regarding poverty. I focused primarily upon self-reliance for two reasons:
1) Ultimately, the only one any of us can truly count on is ourself.
2) Many of the poor have bought into the lie that it’s impossible to do it themselves.
Only the second part bears much comment. Even after pointing out that numerous immigrants come to this country with nothing and become successful business owners, even after pointing out that 73% of all the millionaires in the US started out with nothing, and got no inheritance, even after telling how *I* at least managed to tread water and slowly get ahead, it’s just “Luck”.
Well, *IF* we go with the Stoic’s definition of luck, it is. Because Luck = Opportunity Met With Preparation.
Yes, that means thinking about the long term consequences of every decision you make. Even the smallest ones can have big consequences. Suppose you spend just $3 every work day, stopping to get a drink or snack at Starbucks or some convenience store, etc…
5 day work week x 52 weeks = 260 days worked.
260 days x 3 dollars = $780 gone from your income per year.
That just from $15 spent on snacks per week. Change that to $5 a day and you’re at $1300 per year. $10 (the cost of coffee at Starbucks) = $2600 per year. Now what could you do with an extra $780 a year? How about an extra $2600?
This kind of realization is EXACTLY why I preached about how important financial education is.
One comment to the other post pointed out how systemic poverty and it’s mindset is in inner cities. I get that, and I do NOT blame the poor. As I said last time, there are advocates that make ALOT of money “helping” the poor and telling them how abused they are. What they never really do is anything meaningful to help them. Why? They’d be out of a job if the poor were no longer poor.
The same goes for politicians exploiting the poor. It’s all about maintaining their power base. Why do you think that so many social programs are designed to keep people stuck where they are? Got a husband or live in boyfriend? Sorry you might have extra income and don’t qualify for welfare. Gotta stay a single, struggling mother. Food stamps? SURE! Job training and child care while you’re getting the training? HELL NO!
Don’t get me wrong, this is NOT a Left vs Right thing. The frequent call from those on the Right is “let private charity take care of it”. Cut the social programs and save people taxes and they’ll donate that money to charity. I believe people WOULD give to charity too. BUT would they REALLY give to charities that help the poor? I think people on the Right are FAR FAR more likely to give to charities that support first responders, veterans, youth science programs, etc… Almost anything before the poor because they’ve been brainwashed to believe the poor are lazy instead of lacking hope and knowledge.
So what’s my answer to it all?
Reform public assistance programs so that they’re designed to help people get back on their feet instead of keep them trapped. Job training, day care while getting job training, financial education classes, better structuring of benefits programs so that they gradually decrease as income improves, etc… Yes, that’s expensive but not as expensive as keeping people in poverty for generations.
Infinitely better management of the bureaucracies running such programs has to be a part of things also. Both for eliminating fraud by applicants and even more importantly for doing away with mismanagement and waste within the agencies. The amount of graft and waste in all government programs (including defense) is obscene.
All the programs in the world won’t make a difference if people maintain a poverty mindset though. Long work days are NOT luck. They’re not permanent either. They’re paying the temporary price for a better life. Learning to budget and later invest is NOT rich people gaming the system NOR is it “acting white”.
Yes, minimum wage is only a FIRST stepping stone also. Anyone stuck at that point should be looking for promotions, raises and job training to better themselves. You have to have the mindset that learning is a lifelong process also. Reality is, it’s never been easier to start a business. There’s the gig economy like Uber and maid and tradeskill apps and websites. Selling on Amazon or Ebay or Etsy is easy. All you need is a skill and a smart phone or laptop. There are even multiple free computer coding classes out there nowadays, especially for Python and Ruby. All it takes is a Google search.
You just have to be sick and tired of being sick and tired, and hungry to reach for more, even though it will cause some short term discomfort.
For those who STILL don’t think it can be done… Check out Dave Ramsey’s “Debt Free Screams” channel on YouTube. There are people there who became disabled during paying off debt, or who paid off $140,000 while raising 11 kids. I’ve personally found the stories there VERY motivating.
Find and listen to his radio show too!
And yes, this is long again, but one last thing… If you don’t understand the trap of credit, consider the high interest credit card for the typical poor person with a low credit score. You’re probably staring at a 30% APR (Annual Percentage Rate) for Interest. That means for every $100 in debt on that card, or furniture store account, etc… you’re paying an extra $30 PER YEAR on that money spent. Take 5 years to pay off that $100 balance (minimum payments will take 20 years), and you’ve paid an extra $150 in interest. So you paid $250 for a $100 item because you bought it on credit and didn’t pay it off immediately. Yes, credit is a trap and “The Borrower is slave to the Lender”.