Bloo Driver wrote:
First of all, let's get some framework done here. The article in question cites a report (Workingpoor Project's periodic report) which cites a report (US Census Bureau (Factception!)) that focuses on the "working poor family", which is a relatively nebulous term. In this case, the definition here boils down to a "family" being at least three people - a couple and one child that lives full time with the family and is under 18. "Working" defines two or one incomes where the household puts together at least 39 hours of work time combined, or less if someone was recently out of a job and is actively seeking employment. So right out we can toss out childless couples or single folks. But we do want to consider them, in general, right? Now we get to the "poor" definition. So we look to the US Health and Human Services Guidelines for poverty last year - 10,830 for a single resident household. You'll notice the matrix counts up to 200% of the poverty line as statistics to be considered, and you may ask why? Are you poor at 100% of the poverty line or what, here? The reality is that, even above the poverty line, most government and charitable programs identify financial neediness in people all the way up to the 200% mark.LobsterMobster wrote:
I don't want to derail here, and I know this is a link to Cracked, usually not the most serious or profound website, but I've read a lot of this guy's stuff. It's kind of amazing he's still alive. I encourage everyone to at least give it a skim before calling poor people lazy, because he is poor despite working harder than is reasonable to ask of anyone: Link. Sure there are people who are poor because they're lazy. There are also people who are poor because life just does not give any quantity of any fraction of a sh*t over whether you live or die.
I need to qualify some things before I make a statement regarding this article.At the very least, pay attention to the part where he needs to pay $500 for a water leak because he couldn't afford $150 for a plumber till his next paycheck. That's not laziness.
That being said, that is easily one of the most ignorant and incorrect articles to ever appear at any time on Cracked's front page. It barely falls into the "correct in general but bad at details" category. I don't want to derail the thread too hard about why it's so bad, but I will if you guys like.
- I read Cracked daily. I'm often surprised at the insight put into the articles of a satire/comedy site, and regularly refer said articles to friends much as you have above.
- I work about 50-60 hours a week at a job where I specifically help the financially disadvantaged do things such as build credit, attain homeownership (if that's what they wanted in the first place), find ethical banks, and handle personal finance management.
- I personally make near-nothing because my job is a not-for-profit, and we are regularly worried about our doors closing on a quarterly basis.
Or, as I was callously told once by someone who didn't like our company's policy of helping anyone, "Families who make over $40,000 a year don't have real problems."
It's really important that when we talk about the poor and poverty and all of this that we have some sort of baseline to view statistics from, because the word poverty is extremely subjective. Let's make sure we go back and get the correct context for this person's article, though, after all of the numbers fly by - a working poor, statistically average family here is four people (two adults, two nonworking children) that makes $43,512 each year maximum. That word maximum is important because I've personally noticed when you talk about income limits or poverty consideration limits, people tend to confuse the ceiling with the baseline.
So, with some of that in mind, let's take a look at the article.
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This is a correct point. I want to emphasize this because I've noticed if I don't go on and on and on about how unfair the poor have it rather than try to look at it analytically, people think I'm a baby eater. Which I am, but for purely personal reasons.What I am saying is that people are quick to tell you to pick yourself up by your bootstraps and just stop being poor. What they don't understand is the series of intricate financial traps that makes that incredibly difficult.
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This is true for everyone. The situation he's about to describe is a liability for a lot of people because nearly no one keeps excess funds in their checking account (assuming they have one). People move these funds to savings (which doesn't do them a lot of good, but that's something else entirely), and even overdraft protection doesn't work as well as people tend to think.This is the future, where many businesses no longer accept cash as payment. That means you are required to have a checking account to function in the economy. And if you're poor, that means at some point you're going to get bank-****ed. Because having a checking account while poor doesn't just mean you have to be responsible and good at math -- you have to be perfect. Meticulous, flawless record keeping is the difference between surviving and having the bank seize your next paycheck.
So he goes on to say, effectively, "If you don't balance your checkbook, the bank rapes you in check fees." Yes. Duh. I don't know what else to say about that. I think he had a point here that he failed to make so I will make it for him - proportionally speaking, bank fees hurt the poor way more than anyone else. A $35 overdraft fee is more likely to send the poor spiraling out of financial control, but it's not actually more likely to happen to them than anyone else. People, in general, are completely horrible about managing their spending money. And I don't mean "spending money" like "free money that you have after bills and baby maintenance". No, I mean money they spend, which for most people is 100% of their money. They are bad at all of their money, is my point, and this is not a "poor person problem".
After that, we get a marginal treatment of the actual damn problem - check cashing shops. Fees to use the money you earned is ridiculous, but thanks to the wildly inflated story this guy spins about the banks hating you and wanting you to die*, the poor are less likely to bank at all because they feel the instant they put their money into a financial institution, there is a man somewhere dreaming up ways to make it vanish. So they go to check cashing places, which will also helpfully give you title and payday advance loans (mentioned later). So already, this article is well on its way to reinforcing part of the problem! Hooray.
(*of course, he takes a line to mention that you can talk to them like they have real blood in their veins, almost like a person)
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No, actually, people take out payday advance loans because 1) The aforementioned loathing of banks, and 2) They really don't understand how much trouble they're asking for the first time. The above situation is a distant third. Now, to be fair, there are a great deal of folks who finally get it (or, rarely, understand right off) but can't stop their "need it now" attitude.Think you're too smart to ever use one of those shady "payday loan" places? Well, you should know that nobody thinks they're a good deal. People go there because they're choosing between which ****ing provides the most lube. Say the gas bill is a month past due, and they're threatening to turn it off (if so, it's $150 to get it reconnected). Or you're about to be late on a credit card payment (which would be a fee and a doubling of your interest rate). Or your favorite S&M whip broke, and Whipfest is coming up (entry fee is nonrefundable). That is when you find yourself swallowing your pride and heading to the payday loan place.
The amazingly stupid part here is that he mentioned the cost of a payday loan is a flat 15.5% interest charge (which is wildly inaccurate and too low, but it's enough to make him look stupid here) and then later states that it's better than going back to the bank and their fee cycle. Really? Simple math tells us that it only takes us to get just over $200 in need to break even with the fees, and he uses a $500 example. And honestly, if you need $500, you can get a relatively inexpensive personal loan from the bank you don't have because you listen to people like this. The interest fee will be smaller.
Either that or you can, don't get the pitchforks and torches yet, get a credit card and use it wisely, for things like this. Getting a credit card is ridiculously easy, even today, even if your credit stinks. Of course, using the payday loans every few weeks is wrecking your credit, which makes his next point both wrong and hilariously misinformed.
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The old "no credit is worse than bad credit" addage makes me cringe every time I hear it. Now, in this case, he's saying no credit is just as bad as bad credit, which is also incorrect. Sure, if you want a car or a house, then yes you will need a credit history. However, most of the examples he cites - rentals, utilities, cell phones, small loans - all deal with folks who have no credit: students and/or people who just moved out of their parent's house. They have programs, they make exceptions, because they know a large chunk of their business would go away if they didn't. It's not as ideal as having excellent credit, sure, but it's certainly not as bad as actual bad credit history/scores.You'll find out the problem the next time somebody does a credit check -- having no credit will stop you from getting a loan or an apartment just as fast as having bad credit. And more importantly, if you have old bad credit due to a bunch of previous ****ups, simply vanishing off the credit map doesn't do anything to fix it.
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Someone fire the factchecker. Bills where you are not borrowing and repaying do not appear on your credit history unless they are collections accounts. A recent exception to this is property management companies more commonly (but not universally) reporting your lease as a loan where the total borrowed is X*Y, with Y being your rent (and thus your monthly payment) and X being your term.So repairing credit means opening accounts (having a cell phone plan is a good one, having your utilities in your own name -- as opposed to the landlord's -- is another) and, you know, making sure to pay your ****ing bills on time.
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Hey he got one right. It's the Beck Theorem - keep flinging stuff out there till something sounds good.And don't bother trying to shortcut the system by saving the shoebox full of cash, getting a loan, then paying it all off the next month. Length of credit is part of your credit score. They want to know your ability to make steady, long term payments without missing a month or being late.
Onward -
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Yes, it is. I get a lot of hate here but the simple fact is that if you have an income, you can save. You can save maybe $3 a month, but you can save. The hurdle to savings is not lack of income, it's a lack of validation. Saving $3/month feels useless, but out of literally hundreds of clients I've counseled, every single one of them that I convinced to carve out a ridiculously small amount of money did so, and within a year usually worked their way up to saving $25-$50 a month. That puts them ahead of the majority of the country. And they were making just around 120% of the poverty level in the majority of the cases. Saving money feels useless when you feel like you can't save anything useful. But when you start saving, it really is like working out. You see results, you get confident, and you get more dedicated.***t happens, always at the exact worst time. A tire blows on my car and, without a spare, it instantly becomes a paperweight. There's $80 for a new tire, $50 for a tow. Now, it's a good idea to have a separate bank account set up specifically for these situations because they are unavoidable. It's also a good idea to have a sex slave or two just sitting around in case your balls need shaved. It's not that ****ing simple.
Yes, crap happens, and the savings goes away, and that sucks, hard. But that's much better than everything he describes hereafter. And it is avoidable. The most damaging attitude among the poor right now is that there is no real way out and anyone who says otherwise is just out of touch.
PS Once again this guy is marveling at how this is a poor person problem specifically. And my attitude is the one seen as out of touch. (LARGE EYEROLL EMOTE HERE)
The last point is both huge and small at the same time. I say this because the point he makes is, effectively - You can't get a better job because you're too busy reacting to your crappy poor life to do anything proactive. Which, to be honest, is a large consideration.
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This is... true for everyone. This is not a poor person's problem. This is any adult's problem. I will be honest, when people say "pull yourself up by your bootstraps" or some similar empty air crap, I want to knifehand their throat. But in this case, the guy has taken the extreme opposite - "What you expect me to invest time and hard effort to exceed my current situation? Bull!" Sleep six hour nights. Study your face off. Put in overtime to get on the boss' good side. And he even writes about how difficult it is to get a second job - what year is this man living in? Companies prefer part timers now - they don't have to pay as much for insurance (or any at all, depending on the state and hours), and those part timers will beg for "overtime" which doesn't have to be time and a half.Sure, you can take classes at night at a community college or something. Maybe you'll even get financial aid or loans to pay for your books or tuition. What they will not pay for is the time you missed at work while you were in classes or for a babysitter or for transportation. And you sure as **** better be certain that you have some kind of aptitude for whatever you're studying (which, by the way, you won't know until you've spent a year or two studying it) because that's the only chance you're going to get.
In the end, this is just a guy letting off steam about his situation. And I don't mean to belittle that situation - being poor is horrible. It's a pretty easy thing to get frustrated about and feel like there's nothing to be done for it, but this guy should have kept this crap on his blog and not been able to put it out there so other, similarly uninformed people, could nod their head and feel validated.
