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Why poor people make poor decisions

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Re: Why poor people make poor decisions

#81

Post by robocat »

Der_Einzige wrote: post #54
rbrtl wrote: post #40

Earlier quoted context omitted.

This is the only lesson I really took away from Robert Kiyosaki's "Rich Dad, Poor Dad." People will say what they will about the man, and his kin, that he's a peddler and just another business man out for himself. I'm sure much of that is true, and personally I can't reconcile the fact that he is personal friends with DJT... However his strongest point throughout that book is that it is essential that people who want…

This book is hot garbage. His analysis of real estate (apperently not an asset) is so bad that I cannot imagine that anyone who read this book made money. Even if the author wasn't shady I'd throw it away

Here’s a summary of the book:

“”” The Five Big Ideas

The poor and the middle-class work for money. The rich have money work for them.

It’s not how much money you make that matters. It’s how much money you keep.

Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets.

Financial aptitude is what you do with money once you make it, how you keep people from taking it from you, how to keep it longer, and how you make money work hard for you.

The single most powerful asset we all have is our mind. “””

Some of the book might be “garbage”, but some of the central concepts most certainly are not, and popularising the above is worthwhile IMHO. Not saying you are wrong, but I do believe it is wrong to so strongly denounce the book without recalling its virtues.

The summary above is from the 1st link I looked at: https://www.samuelthomasdavies.com/book-summaries/business/r...

Re: Why poor people make poor decisions

#82

Post by bluGill »

wufufufu wrote: post #18
umvi wrote: post #11

> Poverty is not a lack of character – it’s a lack of cash. No. Poverty is a lack of education and, more importantly, mentorship. I am battling this right now with my next door neighbors, who use HOC, a Maryland social service that basically puts poor people in middle class neighborhoods by subsidizing rent. My neighbors have money. They spend it extremely poorly. It's a single mom with 2 kids. Both kids have iPhones…

I agree, but I also think there's social cost to not spending your money on status symbols. You will be ostracized by the rich and educated groups for not fitting in, and then how will you acclimate to a higher social sphere? Example[1] [1] https://gizmodo.com/im-buying-an-iphone-because-im-ashamed-o... edit: Ok this obviously isn't black and white, but I'm saying this should be considered among other things.

Actually the real rich probably live in the same poor neighborhoods, or just one level up in modest houses. They drive similar old cars. They wear similar cheap clothes. You have to look a second time to realize that the cheap house has good paint on it (cheap enough that the poor sometimes buy it), and a few other details are slightly better. They have a ton of money in the bank and don't have to worry about it.

The pseudo rich with all the status symbols are generally more in debt than the poor person who needs to use a car title loan to get food at the end of the month!

Of course there are also the "filthy rich" with a ton of money with all the toys just like the pseudo rich. They are a minority of those living that lifestyle though.

Re: Why poor people make poor decisions

#83

Post by miguelmota »

A lot of people are poor because they trade education and learning for cheap short-term entertainment. People that remain poor aren't thinking about the long-term. They spend a ton of money on fast food, they do unneeded impulse purchases, they go for quick dopamine rushes and fall back into depression when it wears off. Many people get 'comfortable' in their low wage jobs complaining everyday how much they hate it, but when they go home they go straight to watching Netflix instead of improving their skills to make themselves more valuable. A lot of the time, poverty is a mindset.

Re: Why poor people make poor decisions

#84

Post by [deleted] »

moralestapia wrote: post #35
umvi wrote: post #11

> Poverty is not a lack of character – it’s a lack of cash. No. Poverty is a lack of education and, more importantly, mentorship. I am battling this right now with my next door neighbors, who use HOC, a Maryland social service that basically puts poor people in middle class neighborhoods by subsidizing rent. My neighbors have money. They spend it extremely poorly. It's a single mom with 2 kids. Both kids have iPhones…

>No. Poverty is a lack of education and, more importantly, mentorship. Privilege is invisible, or so they say. This is an extremely short-sighted approach to trying to find an explanation to poverty. It is also a lazy excuse to avoid thinking more, because it leads to a conclusion like "... hence why they're poor. That's it." I hope one day you have the (mis?)fortune of living under precarious conditions, then you co…

[deleted]

Re: Why poor people make poor decisions

#85

Post by dragonwriter »

lazyjones wrote: post #21
umvi wrote: post #11

> Poverty is not a lack of character – it’s a lack of cash. No. Poverty is a lack of education and, more importantly, mentorship. I am battling this right now with my next door neighbors, who use HOC, a Maryland social service that basically puts poor people in middle class neighborhoods by subsidizing rent. My neighbors have money. They spend it extremely poorly. It's a single mom with 2 kids. Both kids have iPhones…

> These kids need mentors more than they need cash. They need adults they can emulate who can help them break free from the viscious cycle. A father, perhaps?

If a parent could model behavior which reliably leads out of poverty, their children likely wouldn't be poor in the first place.

So, yes, having a not-poor father (or mother) as a role model would be great, but that's often not a practical solution.

Re: Why poor people make poor decisions

#86

Post by danans »

bluGill wrote: post #77
danans wrote: post #72

Earlier quoted context omitted.

> My neighbors have money. They spend it extremely poorly. It's a single mom with 2 kids. Both kids have iPhones, iPads, PS4s, cable TV, you name it. iPhones and video games are very cheap compared to good schools and safe and mentally stimulating childcare. A poor person's children having an iPhone and PlayStation is no more an indication of their having money than my kids not having those things is an indication th…

Those things are cheap only if the kids have enough food to eat. I buy a few nice things, but I don't have that much even though it is safe to assume I have 4 times the income (including welfare). My family eats good food, and my kid does well in school. I'm not against the poor having nice toys, but the priority is not toys. Yet I see the poor spending a lot of toys that are often discarded in a short time.

> I'm not against the poor having nice toys

But they aren't toys. They are very cheap, and very bad childcare.

Re: Why poor people make poor decisions

#87

Post by GuB-42 »

wufufufu wrote: post #18
umvi wrote: post #11

> Poverty is not a lack of character – it’s a lack of cash. No. Poverty is a lack of education and, more importantly, mentorship. I am battling this right now with my next door neighbors, who use HOC, a Maryland social service that basically puts poor people in middle class neighborhoods by subsidizing rent. My neighbors have money. They spend it extremely poorly. It's a single mom with 2 kids. Both kids have iPhones…

I agree, but I also think there's social cost to not spending your money on status symbols. You will be ostracized by the rich and educated groups for not fitting in, and then how will you acclimate to a higher social sphere? Example[1] [1] https://gizmodo.com/im-buying-an-iphone-because-im-ashamed-o... edit: Ok this obviously isn't black and white, but I'm saying this should be considered among other things.

That's a very dangerous suggestion.

The risk is buying into status symbols of a class beyond your reach. You may signal a certain amount of wealth by buying the latest iPhone, but the "rich and educated" won't be fooled. They will quickly notice where you are living, the car you are driving, the clothes you are wearing and how you spend your vacations, etc... And if it doesn't match, you will get ridiculed. You will be better off living within your means. The rich usually have good finances, that's why they are rich, and they will be more likely to accept you if you have it too.

But getting shunned is not the worst that can happen. If you try to follow them, you are going to get burned very quickly. If they can afford a $100 dinner on a whim, they are going to do it, why wouldn't they. And if you want to stay in their group, you will be tempted to follow, except that you can't afford it.

Re: Why poor people make poor decisions

#88

Post by homonculus1 »

moralestapia wrote: post #52
daenz wrote: post #30

Earlier quoted context omitted.

Future mothers and fathers should exercise common sense to have a child only with a good partner. That's who that message is for, not the child.

This point comes out from time to time, I do not agree with it at all. If history has showed us something, is that great people come from all sorts of backgrounds and situations, and that includes all sorts of families of course!

You can't generalize heuristics by looking only at outliers.

Re: Why poor people make poor decisions

#89

Post by dragonwriter »

lazyjones wrote: post #28
wufufufu wrote: post #18

Earlier quoted context omitted.

I agree, but I also think there's social cost to not spending your money on status symbols. You will be ostracized by the rich and educated groups for not fitting in, and then how will you acclimate to a higher social sphere? Example[1] [1] https://gizmodo.com/im-buying-an-iphone-because-im-ashamed-o... edit: Ok this obviously isn't black and white, but I'm saying this should be considered among other things.

> You will be ostracized by the rich and educated groups for not fitting in, and then how will you acclimate to a higher social sphere? What's so interesting in the rich (and supposedly educated, I'll take your word for it...) groups that you have to buy into them with expensive junk? Do you have any idea how many uneducated rich fools there are nowadays and how they spend their wealth in just as stupid ways as the p…

> What's so interesting in the rich (and supposedly educated, I'll take your word for it...) groups that you have to buy into them with expensive junk?

The fact that opportunity is driven largely by networks, and that networks are typically class-gated (not exactly wealth-gated; most people recognize that class and temporary circumstances aren't the same thing.)

Unfortunately, social seeking by the poor who aren't mentored on social signalling by someone already in or experienced with higher classes is likely to reflect lower-class misconceptions of higher-class signals, and fail as class signalling.

Re: Why poor people make poor decisions

#90

Post by rurp »

emblaegh wrote: post #75
miguelmota wrote: post #71

Earlier quoted context omitted.

I think churches fuel poverty more than they help. Religion teaches people that they are the way they are because that's how 'God' intended them to be and that they'll be rewarded with riches when they go to 'heaven'.

Even as an atheist myself, I can tell how ridiculously uninformed this view of Christianity (and probably most other religions) is.

Can you explain how that post was ridiculous? It matches my understanding of Christianity pretty well.

The idea that suffering in this life is OK because it will pay off in the afterlife seems to be a common theme in the bible and helps explain why Christianity has been so consistently successful within poor communities.

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