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Most Money Advice Is Worthless When You’re Poor

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Re: Most Money Advice Is Worthless When You’re Poor

#71

Post by notacoward »

There's a lot more to being poor than not having money. Being poor and healthy is not the same as being poor and unhealthy, as the most obvious example. Being poor but healthy, smart and/or educated, non-addicted, connected to family and friends who will keep you off that last step to oblivion is different than being poor and none of those things. Poor nutrition and sleep and being cold all the time can really do a number on your brain. So can the stress of not knowing where your - or your children's - next meal is coming from. The isolation and despair and distrust that come with spending any time at all in that condition can stay with you for years.

So yeah, poor people follow a very different decision process, which might not seem rational to people who have only ever been poor in the low-bank-balance sense (if that). Don't tell someone who's already deprived to deprive themselves further. Those small indulgences might be the only thing keeping people from giving up entirely. To the extent that the truly poor need advice from the less poor at all, it's advice on how to secure the most basic of needs in the short to medium term. Only then, only when the most severe psychological effects of being poor have been dealt with, is it rational to expect that people will start looking further up Maslow's pyramid to things like longer-term financial security.

Re: Most Money Advice Is Worthless When You’re Poor

#72

Post by ddingus »

icedchai wrote: post #64
seibelj wrote: post #30

Earlier quoted context omitted.

A long time ago I worked at a pizza shop as a delivery boy and cook. Multiple coworkers had luxury cars, including one Cadillac sporty sedan. They just seemed to put every possible spare dollar they had towards the most expensive car possible. Made no sense, but buying too much car is a common phenomenon in America.

Blame the banks. If it weren’t easy to get loans, people would live within their means. They wouldn’t have a choice.

Yes they would. Banks are not the only finance means.

On a more basic level, we set expectations for standard of living, and business actually depends on, expects those behaviors, while half the nation does not have income to meet those expectations, often despite full time or more labor.

This idea of shitty jobs being worthless completely ignores the cost of the laborers. And those costs fall on all of us.

Why subsidize business in this way?

Or, if we want to do that, why so much angst over assistance?

Re: Most Money Advice Is Worthless When You’re Poor

#74

Post by zozbot123 »

notacoward wrote: post #71

There's a lot more to being poor than not having money. Being poor and healthy is not the same as being poor and unhealthy, as the most obvious example. Being poor but healthy, smart and/or educated, non-addicted, connected to family and friends who will keep you off that last step to oblivion is different than being poor and none of those things. Poor nutrition and sleep and being cold all the time can really do a n…

> Those small indulgences might be the only thing keeping people from giving up entirely.

I might be sympathetic to that point of view... but then what about the 'indulgence' of keeping a rainy-day fund? You know, the one indulgence that OP fails to acknowledge in any way and even disparages, despite the fact that indulging in this gets rid of a major source of stress in a poor person's life? This is why you should save, even at strenuous cost. Because when you save, you do feel better.

Re: Most Money Advice Is Worthless When You’re Poor

#75

Post by username90 »

notacoward wrote: post #71

There's a lot more to being poor than not having money. Being poor and healthy is not the same as being poor and unhealthy, as the most obvious example. Being poor but healthy, smart and/or educated, non-addicted, connected to family and friends who will keep you off that last step to oblivion is different than being poor and none of those things. Poor nutrition and sleep and being cold all the time can really do a n…

The problem is that these people are addicted to things they don't need which makes them unable to fulfill their actual needs. It is impossible to help people who easily gives in to their addictions like this, so the first tip should always be to get off their addictions. Of course they don't want to do that so they don't listen, but that doesn't make the tip bad.

Re: Most Money Advice Is Worthless When You’re Poor

#76

Post by DanBC »

DanBC wrote: post #67
ddingus wrote: post #18

Earlier quoted context omitted.

The poor people do not buy $20k Civics. For about half the nations labor force, that purchase could be half a year worth of income. Given housing and other costs, financing that purchase is difficult. What they do is get $500 to $2000 cars. And those do break down frequently. They may or may not have resources, skill and or time to repair them.

And those cheap cars are more likely to have faults that police can write tickets for, pushing those poor people into further debt, and then into the criminal justice system because US courts are just weird.

I don't understand why this has been downvoted, it describes a well known phenomenon of US courts. This was one of the factors at play in Ferguson: police were told to maximise revenue, and they were doing this by issuing fines to car drivers.

Those drivers then have to attend court to pay the fines - missing work and losing wages because of it, and sometimes losing their jobs.

If they don't attend court to pay their fines they have arrest warrants issued against them.

https://www.bbc.co.uk/news/world-us-canada-31849421

https://www.theguardian.com/money/2014/mar/02/poor-for-profi...

Re: Most Money Advice Is Worthless When You’re Poor

#77

Post by icedchai »

ddingus wrote: post #72
icedchai wrote: post #64

Earlier quoted context omitted.

Blame the banks. If it weren’t easy to get loans, people would live within their means. They wouldn’t have a choice.

Yes they would. Banks are not the only finance means. On a more basic level, we set expectations for standard of living, and business actually depends on, expects those behaviors, while half the nation does not have income to meet those expectations, often despite full time or more labor. This idea of shitty jobs being worthless completely ignores the cost of the laborers. And those costs fall on all of us. Why subsi…

I may be confused. Owning a luxury automobile has nothing to do with expectations for a standard of living. In many parts of the world, a car is required, yes... but a Cadillac, Mercedes, or BMW? No.

Re: Most Money Advice Is Worthless When You’re Poor

#78

Post by EliRivers »

brianpgordon wrote: post #46
EliRivers wrote: post #37

Earlier quoted context omitted.

Yet they don't. Why not? Why is your advice here not being taken?

I think he has a point that you're assuming debt is the problem. It seems to me that she's just not being paid a living wage. If she's really struggling that much to make rent I would be surprised if anyone would give her credit at all, other than maybe short-term payday loans. And declaring bankruptcy every month doesn't help you avoid eviction.

No, quite the opposite for me. I think debt is more a symptom here. Here is your life (however you got here - maybe you made bad choices, maybe you didn't), there is no escape. One of the things holding you down is debt, but wiping that out will not help you because you come up short every month. You'll just be back in debt next month.

Re: Most Money Advice Is Worthless When You’re Poor

#79

Post by em-bee »

pasta wrote: post #16
aw3c2 wrote: post #2

https://en.wikipedia.org/wiki/Sam_Vimes#Boots_theory_of_soci... > The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. > Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the card…

I don't think this applies anymore. Cheap is getting better and better. And the rich just buy new because they like to go with the trend spending hundreds of dollars on boots. Most people I know (Netherlands) who are not wealthy have mental issues or don't know how to manage money. Edit: I don't want to sound like I think the author belongs to those 2 groups. There are many more reasons why someone is poor.

cheap is getting better, but also expensive is getting worse.

i can't tell from the price whether something is of good quality or not.

Re: Most Money Advice Is Worthless When You’re Poor

#80

Post by em-bee »

dsfyu404ed wrote: post #10
xythian wrote: post #5

A shoutout to https://www.reddit.com/r/povertyfinance/ as a community that is attempting to discuss and distill the kind of financial advice that is useful for those with little to no means. > Much of the financial advice online and on reddit is aimed at people who have varying degrees of disposable income, ability to invest, lots of free time, available transportation, no kids, a partner, access to credit, and beyon…

Reddit is a crap place to go for advice if you're in a situation where all the options are sub-optimal because any advice that isn't 100% by the book ethical or any advice that puts a negative externality on society for personal benefit results in down-votes and name callings. Often times that means your "best" options are off the table. It is also very much against "low class" ways of saving money. Stuff like "just…

you are probably being downvoted because you seem to suggest that illegal or imoral actions should somehow be acceptable just because you need to save money.
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