Q about wealth/poverty

[LucyStoner]

But this isn't right IMO either. I WANT those safety nets (aid) there for people who are in situational deals. That's what I pay in (willingly) for! There are many who are literally just in a bind for a set period of time and CAN help themselves a bit more easily if some of the basics are paid for for them.

 

I WANT food stamps available. I WANT WIC available. I WANT medicare, unemployment, welfare, etc, etc, etc, to help people get out of their situation.

 

What I don't want are those who game the system.

 

For the student I mentioned earlier in the thread where I gave him lunch money for the week, I WANT him to eat at no cost to him or his family if they are in a bind at the moment, and in his case, I don't care what the issues are with mom & dad. No child should go hungry - even high schoolers. Sometimes it really does take a village. In the meantime, he is putting forth effort to get his education. He's not one of those telling me he plans to live off the system, so to me, it's a win-win.

 

If any of this applies to you - by all means - PLEASE use these things without feeling shame or whatever word should be used.

 

 

I agree wholeheartedly. All not accepting help does is reinforce the idea that there is shame in a hand up. There is not.

[LucyStoner]

See my used Toyotas buy me status too. Status as a very practical to the point of boring person with zero tolerance for car troubles.

[Upward Journey]

This is the scenario I've seen in many families. A bad week can be made up, a bad month makes you bite your nails, a bad season forces you to make different choices for that time, a bad year can be enough to piss you off, and it's hard to pick up from that if you own a business. It can easily snowball into a bad five year or ten despite working hard, smart, all hours in all kinds of weather through all kinds of crises. 

 

I've seen too many men in the 40s break or break down from the stress. Mental illness, health issues, suicide (attempted or otherwise) because despite working their assets off for years, they were not getting ahead and barely doing enough to maintain the status quo. I've seen men have to change jobs or industries and start at much lower wages than before. It takes time to reshuffle, especially for those caught in the housing bust. It's a humbling experience to see a man who has worked his tail off most of his life break. Some get up, some don't. In my case, he didn't and I'm starting over at below the poverty level. 

 

Truth.

[SKL]

Well I don't think this is complicated at all.  Are there people too poor to put aside savings, yes.  Are there also poor people who spend on frivolities instead of choosing to save or pay down debt, yes, and this isn't uncommon.  Is this latter situation a rather curious state of affairs, yes, and that is what this thread was supposed to be about, I think.

 

Nobody says that all poor people spend frivolously.  Some posters seem unwilling to accept the fact that some poor people do spend frivolously.

[Lang Syne Boardie]

Thanks to all for the advice, criticism, and warnings I've received on this thread and privately. I have a plan and am working the plan. It's a matter of getting through the next few months until serious changes can be made.

[justamouse]

 

I really like a station wagon and have been secretly eyeing the Ford Flex but the Mercedes runs great now and I can't come up with a good reason to get rid of a car that doesn't have problems.  

 

The only reason our Benz was a deal was we had an actual German mechanic who was trained by Benz. The cars are designed to never break down. At ___ miles they get this belt replaced. At ___ miles they get that replaced. He was a gifted mechanic. 


 

People buy new luxury cars because they're a status symbol, too, right? Maybe it is a deal to them but not for you.? Why begrudge someone with $5000 to spend and they choose a Mercedes? They'd probably last longer than many other $5000 crap cars, and can always be sold to someone else for a few thousand who want to experience the feel of owning a cool car. I see her comments as just another way of dissing poor people.ooohh, I walked past section 8 homes and you wouldn't believe all the high end cars those people drive.... It's the same crap as bitching about someone whipping out their food stamp card from a Coach purse, or buying a god forsaken shrimp "when I can't even buy that for my own kids"!

People weren't keeping the Benzs in section 8 housing because they were dependable. Please. And she sees the owners almost every day in court as repeat offenders. How DO they have the $ to post bail all the time?  Want to see the problem up close and personal? Go work in the judicial system in the inner city. 

Delayed gratification. How about the status symbol being saving the $ and getting out of section 8 and moving to a place where you don't have to worry about what your kid sees every time they walk out on the street? Or getting out so that they can go to good schools? THAT should be the status symbol. 

[hornblower]

Totally OT, but apparently, Aussie babies find it easier to understand a Canadian accent than their own mother tongue. accent! So we should speak like you guys.

 

but you guys sound much cooler. I had an Aussie snowboarding instructor. No doubt he was writing indignant eye-rolling emails home about all the middle aged women trying to flirt with him.....

 

& this summer I discovered where all the Aussie snowboarding & skiing instructors go in the summer. They're teaching waterskiing & wakeboarding at our resorts. This summer, when camping at the lake,  I heard one quite early one morning; you know how voices carry across the water when it's quiet?  Oh boy, that man had a voice like silk. He was coaxing someone who had obviously had a lousy couple runs to just try one more time. I almost abandoned my dogs & swam out to them to elbow the hapless client out of the way & muscle myself in... "I'LL TRY! Let ME try!" 

 

I understand the whole mermaid luring sailors into the water with their voice thing much better now....

[Reefgazer]

nm

But those things are not financial in nature.  Certainly they make things harder though.  And you also stated a defeatist attitude as part of your justification for why someone couldn't move up.
 
What I would expect financial education to do for people is to allow them to understand money attitudes, how to work on changing their money attitudes, and identify and work to change their particular self sabotaging behaviors, how to better assess financial options.  Honestly, financial self help books accomplish this in many ways and are a dime a dozen....but in order to capitalize on this stuff, it still takes a conducive attitude, hard work, and determination.  And of course, having been taught this stuff early in life would be even more ideal.  
 
I have my own relatives that live in poverty and quite frankly I expect they will never break out.  They have their own inherent challenges (mental health and addiction), but they have just as many problems with outright indefensibly poor judgements and attitudes around work and money. But they won't fail to break out because of those challenges, they will fail because their attitude is one of apathy, making excuses, and "you can't expect more from me".  Being around them and their particular plights have not changed my opinions on this topic. 
 
Stefanie

[Reefgazer]

nm

So, which of y'all 'it's all in the attitude' ladies would like to be my pro bono financial advisor ?  I am very happy to have my attitude worked on if it means more money. If we fail, does that mean I just pretended to have an attitude change ? Should I start trying to manifest a house ?

 

I would LOVE to do this as an experiment and pair up with someone who believes they have the right advice for someone to make more money through attitude change.

 

In six months we can report back :)

 

My only caveat is that you will have to take into account in your advice that I already homeschool x 2, study, have a chronic progressive illness, run the family and household on my own as dh also works and studies full time and I have extended family commitments.

 

C'mon, someone with a sense of humour and adventure, come mentor me...wouldn't you like to try your ideas out on a willing guinea pig ? Who knows...maybe I'm wrong ? Some people would give their eye teeth to prove me wrong :)

 

[creekland]

So, which of y'all 'it's all in the attitude' ladies would like to be my pro bono financial advisor ?  I am very happy to have my attitude worked on if it means more money. If we fail, does that mean I just pretended to have an attitude change ? Should I start trying to manifest a house ?

 

I would LOVE to do this as an experiment and pair up with someone who believes they have the right advice for someone to make more money through attitude change.

 

In six months we can report back :)

 

My only caveat is that you will have to take into account in your advice that I already homeschool x 2, study, have a chronic progressive illness, run the family and household on my own as dh also works and studies full time and I have extended family commitments.

 

C'mon, someone with a sense of humour and adventure, come mentor me...wouldn't you like to try your ideas out on a willing guinea pig ? Who knows...maybe I'm wrong ? Some people would give their eye teeth to prove me wrong :)

 

Ok, I'd need to know if you were serious or not... but regardless, for this first post, from what I see based upon what you've written in what I've quoted:

 

a)  6 months is not generally enough time.  When hubby started his business we really didn't get any income from it for about 18 months - and that's after he was working for a while in the field.  We lived quite meagerly then, and for a bit afterward. Patience and an eye on the goal is the key.

 

b)  You mention studying for both you and your dh.  Is this study something planned to assist with a higher paying job?  If so, I'd suspect you already have your answer coming - and kudos to you!  It's my #1 suggestion to those who ask similar questions.

 

c)  Progressive chronic illness - with free medical care via your system, correct?  If so, that's a BIG bonus.  Otherwise, more details would need to be known (pm perhaps) about what it affects and what is ok.  I'm in the process of dealing with some medical issues myself, so do realize what you could be dealing with.  It's not all theory here.

 

d)   Run the household and family on your own - some of this might really have to change.  Is your University bound student going away or living with you?  Your middle - are they capable of doing more?  When I was 11 my parents divorced.  I lived with my dad.  A good part of household stuff fell on ME at that time.  Kids truly can do things.  As a parent I resumed working when my youngest was 3 (oldest was 7).  It's been part time (rather than full time) ever since because I also want/need to run more things back at home and my hubby works a TON - not totally different than what you imply about yours.  The kids did start filling in the gaps quite early - and it didn't hurt them a bit.  It actually helped them IMO.

 

e)  Extended family commitments - financially, time, or both?

 

In truth, details would need to be worked out.  They have to be for any individual, but if you want it explored some... allowing for some questions due to our differing countries... I'd be game - not to prove you wrong - just to assist with getting higher up.  I can't promise millionaire status.  I don't aim for that myself.  Our aim is to be self-sufficient, provide for my guys, travel, and make the world a better place.

[Reefgazer]

nm

[creekland]

Oh, right. Yeah, I am not in a non-productive environment. So there's that :)

 

This is a huge plus to be honest.

 

[Guest]

So, which of y'all 'it's all in the attitude' ladies would like to be my pro bono financial advisor ? I am very happy to have my attitude worked on if it means more money. If we fail, does that mean I just pretended to have an attitude change ? Should I start trying to manifest a house ?

 

I would LOVE to do this as an experiment and pair up with someone who believes they have the right advice for someone to make more money through attitude change.

 

In six months we can report back :)

 

My only caveat is that you will have to take into account in your advice that I already homeschool x 2, study, have a chronic progressive illness, run the family and household on my own as dh also works and studies full time and I have extended family commitments.

 

C'mon, someone with a sense of humour and adventure, come mentor me...wouldn't you like to try your ideas out on a willing guinea pig ? Who knows...maybe I'm wrong ? Some people would give their eye teeth to prove me wrong :)

I don't claim "it's all in the attitude" and I would never presume to be a financial mentor to someone on the other side of the world based on a few internet posts, KWIM? I just think some of the "can't be done" posts in this thread reveal an attitude that is not conducive to succeeding - in any sense of the word.

[Reefgazer]

You're very lucky; that 's the hardest thing to see and the hardest thing to break out of.

Oh, right. Yeah, I am not in a non-productive environment. So there's that :)

 

[Denise in Florida]

I agree on the difficulty of buying s good quality used car. If you don't have the cash for one that works well you end up spending even more in repairs.  You also run the risk of missing work due to an unreliable car and could lose your job. Therefore, people end up in debt and within a year the car is worth less than the remainder of the loan.  

 

We did find one solution for our daughter, we had a credit union that gave her (with our cosign) $3500 personal loan (5% interest). She bought a reliable older car and makes payments of $70 per month.  We could not afford to buy a car for her, she needed to get to and from a job and school. 

 

She was only able to do that because we had been with the credit union for 25 years and could cosign. But it was a good solution to the "need a reliable car to keep a job, need to work extra to pay for the car" trap. 

 

 

Re: new cars - 

 

I grew up LMC and thrifty-poor. Paying cash for a used car was gospel truth.

 

Truth is - banks and other actual lenders will not give you a car loan for less than around 8k, and only for a newer car. Also, I get Medicaid and WIC for my kids, and one of the stipulations is that we're not allowed to have over 2k in liquid assets.

 

So how does someone in this situation get a car? They get a new or newer one with a huge loan.

 

Or be lucky enough to have a mechanic friend who will do a low-cost trade-and-fix-up. Which we did. But otherwise we'd be sunk in a hole with a car more expensive than we could afford.  :banghead:

 

 

 

Oh, and yes, Goodwill is a rip-off these days. $6 for an old shirt? No thanks, I'd rather spend my money at the clearance rack at TJMaxx. And if the thrift store gets anything good it walks out the back door to be listed on the employees' ebay.

 

[Arcadia]

Dh already works 3 jobs plus full time PhD.

Hubby's AU cousin was a SAHM while pursuing her PhD so I don't know how it works out financially. Is your hubby able to get on campus work like teacher assistant/lab tech? Hubby was doing a PhD full time and his allowance as a teacher assistant pays better than off campus work. Hubby had a monthly stipend close to AUD3k while on his PhD so that helped.

 

Sydney real estate is as crazy as the country I am from. A 99 year leasehold property can hit over $1mil buy price.

[madteaparty]

No, but you probably do need to be able to save, and some people can't do that. Not won't do that, or don't know how, or prefer to blow it all on a handbag, but CAN'T in any way that is meaningful and contributes to financial security.

 

I find it funny that some people on this thread literally do not understand that.

 

Or do not understand the idea that hard work is not always rewarded monetarily.

 

Or reject the idea that the system is set up this way ON PURPOSE.

 

I'm laughing so hard it probably looks like I'm crying....

They have to believe that, because everyone needs a neat little story to explain their current good fortune, and luck just cannot be part of that equation. There's research on this. It had to be their particular blend of hard work, discipline, superior knowledge of the game and predilection for thrift.

Signed, the correct kind of bootstrapping immigrant so adored in these threads who does not buy that argument for a minute.

[JumpyTheFrog]

I don't think too many people are denying the role luck plays. Hard word and delayed gratification are *necessary* but may not be *sufficient* to climb upward in income over the long term. Is it really so hard to believe that *some* people stay stuck or fall into in poverty mostly because of foolish choices? Just as it's wrong to assume all the poor are lazy fools, it's wrong to assume that they all make wise decisions. I understand that people are tired of the "poor= lazy" stereotypes, but it does no good to anyone to defend the decisions of some poor people to overspend on luxury purses and cars. Sure, they can use their money as they see fit, but don't get mad when people say "Hey, maybe they shouldn't spend $800 on a purse when they have no emergency fund." And even if it were from a thrift store, they could sell it to get money for an emergency fund.

 

Every time we have these threads, anyone who points out anything that seems like overspending is berated with cries of "Stop judging! It may be a gift." Sure, sometimes it is a gift, but that still leaves a lot of people trying to buy status in ways not necessary to get or keep a job.

[Sdel]

I don't know the people you are talking about. I do know that something that appears to be laziness to those looking in from the outside can be so much more, especially for people dealing with mental health challenges and addictions. 

 

We'll just have to agree to disagree.  For the record, I have severe depression, arguably more so than the two individuals I've discussed.

 

Stefanie

[Sherry in OH]

For practical suggestions, read The Tightwad Gazette.  This is an older title. Some of the advice is outdated or now illegal. Some is off-the-wall.  But there are many money saving tips that still apply today.  They are not the ‘give up your daily latte’ suggestions so common among more current authors.  Even so, following the advice in the book is not a quick fix.  It won’t be enough for the truly destitute. 

 

For those struggling more with overspending than lack of income, Your Money or Your Life provides a different perspective than The Millionaire Next Door.  Both are eye opening.

[Sdel]

 

C'mon, someone with a sense of humour and adventure, come mentor me...wouldn't you like to try your ideas out on a willing guinea pig ? Who knows...maybe I'm wrong ? Some people would give their eye teeth to prove me wrong :)

 

I'd be more than happy to mail you my copy of TMND.  You could even burn it after you read it to satisfy your liberal sensitivities.

 

Stefanie

[SKL]

"Whether you think you can or you think you can't, you're right."  Quote attributed to to Henry Ford.

 

Quips aside, there's a lot of wisdom more profound than I am capable of that says you can do it if you decide to do it.  Sometimes it ends up looking like a series of lucky breaks or whatever.  Who cares what other people call it if it works? 

 

But if you are invested in the belief that the deck is stacked against you, there's nothing anyone else can do to fix that.

 

And now I'm wondering:  what do cynical people teach their children about their futures?  Do they tell their daughters they may as well not bother to fight for anything because they can't succeed?  Or do they tell their kids something different from what they tell themselves?  Which reflects what they really deeply believe?

[IsabelC]

And now I'm wondering:  what do cynical people teach their children about their futures?  Do they tell their daughters they may as well not bother to fight for anything because they can't succeed?  Or do they tell their kids something different from what they tell themselves?  Which reflects what they really deeply believe?

 

I would never tell my daughters not to bother! But I would warn them of foreseeable barriers. If they want to enter certain male dominated careers, they need to know that they will have to perform better than their male colleagues to get ahead, and that they are likely to face discrimination.

 

More generally, I would say that of course we all want to instill in our kids the idea that perseverance, hard work, sensible planning, a positive attitude and similar attributes are good to have. I don't want to turn the kids into depressed cynics, but they do need to know, eventually, that some "successful" or "wealthy" people are that way largely because of luck (having rich parents, being in the right place at the right time, being blessed with a charismatic personality, being white and male, etc) or dishonesty (I use the word broadly to encompass many ethically dubious practices), and that many people will work hard, be morally scrupulous, yet never rise to power or wealth.

 

I want the kids to know that if they apply for a job for which they have great qualifications and skills, with a really good CV and a great interview technique, they may win the job. Or they may be bumped because the job had already been promised to the manager's  friend's daughter but they had to advertise it anyway. But it's still a good idea to apply.

 

I want them to know that being kind to everybody you meet is no guarantee that everyone will be kind to you, but that it is still a good thing to be kind.

 

I believe that a balance can be achieved between hardbitten cynicism and pollyannism.

[LucyStoner]

For practical suggestions, read The Tightwad Gazette. This is an older title. Some of the advice is outdated or now illegal. Some is off-the-wall. But there are many money saving tips that still apply today. They are not the ‘give up your daily latte’ suggestions so common among more current authors. Even so, following the advice in the book is not a quick fix. It won’t be enough for the truly destitute.

 

For those struggling more with overspending than lack of income, Your Money or Your Life provides a different perspective than The Millionaire Next Door. Both are eye opening.

I have a much read copy of The Tightwad Gazette. It's really just her old newsletters in book form so it can make for a choppy read. And some of it is hilariously dated, like saving money on stamps by mailing your utility bills with everyone on the block together. But it's worth a read. It's not a book about wealth, it is about thrift.

[Joanne]

The answers in this thread make me feel stabby.

 

I have a Prada handbag purchased $12 at Goodwill and a 2006 144K mile car with a dent in the side door. My kids attend a small, private school that I could not pay for if I didn't work there. My dd won't  get into top schools - aligned with her GPA and ability - because I couldn't access premier test prep. For YEARS, financial choices looked like this:

 

Float car insurance or be late on rent?
Get to the dentist or make the car payment on time?
Save for new glasses or a down payment on another junk car?

 

Here is my list of opinions on the  topic, born of blood, sweat, tears, and sleepless nights.

 

1. The American Dream was largely a myth all along, but is even more so now.
2. While my Dad (84) was able to work his way up from janitor to Assistant Manager in a public utility in NJ, the ability to do that has largely disappeared.
3. Being poor is not inherently virtuous or spiritual.
4. Being comfortable or financially stable is not inherently virtuous, either.
5. You can't accurately judge anyone's work ethic based on their financial status.
6. You can't accurately judge anyone's character on their financial status.
7. You can't accurately judge anyone's spirituality or spirit based on financial status.
8. Most people live paycheck to paycheck.

After a decade of working my ass off, for one year, I will be at a high "income" level. But it tells an incomplete story. Some of that will go away in May, when my dd graduates high school and her benefits on her father's record stop - just in time for her college. When my son graduates high school, his benefits will go away and I will stop working 7 days a week. Although I will have a full time job, and a small private practice, I won't make up the income I have for the next 5 months - but I will have MORE, not less, expenses with my kids in college and my FAFSA reflecting a very inaccurate picture.

 

As usual, a significant amount of the content of this thread ignores the fact that low income workers don't have the time to plan, shop, cook, in the ways people are happy to trot out as panaceas to the challenges of low income living.

 

The cycle of living at low income is insidious.

 

 

 

 

[madteaparty]

 

 

And now I'm wondering:  what do cynical people teach their children about their futures?  Do they tell their daughters they may as well not bother to fight for anything because they can't succeed?  Or do they tell their kids something different from what they tell themselves?  Which reflects what they really deeply believe?

In case this is a real question, I teach mine to do the best they can to the very best of their abilities and seek out the most expertise-heavy work of their chosen profession and, while I can afford to pay for their education,  become experts at it, just in case fortune indeed does decide to favor the prepared mind.

Most importantly, I teach them to look internally for validation and to value relationships above all else. And that even attempting to separate people from their own delusions is a fool's errand and that everyone should get to keep them. ;)

[aggieamy]

I would never tell my daughters not to bother! But I would warn them of foreseeable barriers. If they want to enter certain male dominated careers, they need to know that they will have to perform better than their male colleagues to get ahead, and that they are likely to face discrimination.

 

More generally, I would say that of course we all want to instill in our kids the idea that perseverance, hard work, sensible planning, a positive attitude and similar attributes are good to have. I don't want to turn the kids into depressed cynics, but they do need to know, eventually, that some "successful" or "wealthy" people are that way largely because of luck (having rich parents, being in the right place at the right time, being blessed with a charismatic personality, being white and male, etc) or dishonesty (I use the word broadly to encompass many ethically dubious practices), and that many people will work hard, be morally scrupulous, yet never rise to power or wealth.

 

I want the kids to know that if they apply for a job for which they have great qualifications and skills, with a really good CV and a great interview technique, they may win the job. Or they may be bumped because the job had already been promised to the manager's  friend's daughter but they had to advertise if anyway. But it's still a good idea to apply.

 

I want them to know that being kind to everybody you meet is no guarantee that everyone will be kind to you, but that it is still a good thing to be kind.

 

I believe that a balance can be achieved between hardbitten cynicism and pollyannism.

 

I'm a woman in a heavily male dominated field.  Engineering.  In the metropolitan area I live in I am THE ONLY woman owned specialty engineering firm. I've never faced discrimination (or if I have I've never noticed it) and I try to work harder than my MALE and FEMALE colleagues because why shouldn't I?  

 

My parents told me I was smart enough to be an engineer and that it would require a lot of hard work but most things do.

 

When I told them I wanted to start my own company they said "Great!  We'll all probably be working for you some day!"  Only after DH and I were successful did I know that they thought we were crazy starting a business during the recession.  

 

At my previous employer when we did interviews we could always tell the cynics and we never wanted to hire them.  They breed discontent in a company.  It's is way better to go into an interview Pollyanna then as a "realist".  When a manager watches Pollyanna introduce herself to the staff like she's ready to start tomorrow then they know they'll have someone who will be a good fit for their team.  

 

Just a different perspective. 

 

ETA:  I took out my engineering specialty.  There aren't many people who do what I do so I want to keep a bit of anonymity on the internet.  

[Reefgazer]

We probably have more than a fair bit in common, I would say.

 

I do agree with the sentiment that financial success does not necessarily equal life success.  I mean, I chose a few occupations (scientist and stay at home mom) that all but guarantee I won't have Mitt Romney's portfolio any time soon.

I don't think anyone is saying effort is worthless. I think that's oversimplifying it.

And I agree you should take credit for yourself, but I just ask that we all take the time to be cognizant of the fact that others work as hard, as well and didn't get the same results.

I think we do need to evaluate the general idea though that success in life is one and the same with financial success. I would bet that you would agree with that. We probably have a fair bit in common in some ways.

 

[mommaduck]

As for Etsy, Hyenacart, etc, yes, many either have to work illegally or find a loophole to run their business. CPSIA, calling cloth mamapads "medical devices" by the FDA (but cloth diapers aren't), etc, have wrecked havoc for WAHM's. Sure, some states may allow you to cut hair in your home. Many do not and most, if not all, require a license. Licenses, fees, local, state, time, and materials...most make only pin money while trying to find their footing and client base.

 

I have been there and have never made more than pin money.

[MomtoCandJ]

Forget wealthy I just want us to make enough to not have to wait until tax time to fix my car properly, to have matching flooring in the main areas of our home (currently we have 9 different floor coverings in a 6 area home (5 rooms and the hall)), I'm going back to school (round 3) to be a RN, general business (no degree but all the classes) and pharmacy technician (no IV training) isn't working. The largest obstacle for us is childcare, there isn't many here and they cost a lot making going to work pointless. Also most are not open past 5 pm so if I was to work as a gas station clerk or something like that, I would need someone to pick up the girls at 5 (which no one we know can do) and watch them until dh gets home at 6 (so we would have to pay two people) When I go back to school the daycare will be partially subsidized by the school and is reasonably priced and I only need to pay for dd2 since dd1 will be in school most of the day and of need be dh can get her off the bus and take her back to work with him.

[idnib]

Forget wealthy I just want us to make enough to not have to wait until tax time to fix my car properly, to have matching flooring in the main areas of our home (currently we have 9 different floor coverings in a 6 area home (5 rooms and the hall)), 

 

If you're waiting for tax time to pay for these items try and have less money withheld. No need to give the government a loan when you yourself need the money. Even though it's late for 2014 you can still fix it for 2015.

 

:grouphug:

[MomtoCandJ]

If you're waiting for tax time to pay for these items try and have less money withheld. No need to give the government a loan when you yourself need the money. Even though it's late for 2014 you can still fix it for 2015.

 

:grouphug:

Dh has all the exemptions he can take, most of it is Earned Income Credit :(

[idnib]

Dh has all the exemptions he can take, most of it is Earned Income Credit :(

 

Do you mean allowances, rather than exemptions? I believe there is no limit but if you claim more than 10 the IRS will double-check the amount and tell your DH's employer if it's too many. Did the employer actually get a letter from the IRS telling them he could not claim more? The worksheet they use on the W-9 is just a suggestion as far as calculating allowances. One year we ended up in a very weird tax situation (don't ask) and we claimed something like 24 allowances and it was fine.

[LucyStoner]

People used to be able to get the EIC throughout the year in their paychecks. That went away about 4 years ago so many people have to wait until tax time for that refund, they can't change the adjustment to get part of it with each paycheck. Though if your income tax owed is consistently 0 you can file a w-4 that makes him as exempt from FICA withholding. Just be sure to file a new w-4 if your income rises.

[happypamama]

Husband used to drive a used BMW, which he had thought of as a great deal. Apart from being useless in the snow, the car also cost a ton to repair. He now drives a Ford Focus, which is cheap as chips to maintain.

 

L

And, hey, if it's good enough for the Pope. . .

 

(DH also drives a Ford Focus, and it has indeed been very cheap to maintain. Two new tires every year because of high mileage driving, and at the 200K miles mark, we spent $2000 to put a new-to-us engine in it, but otherwise, it has needed blessedly little over almost seven years, even though it was four years old when we got it.)

[idnib]

People used to be able to get the EIC throughout the year in their paychecks. That went away about 4 years ago so many people have to wait until tax time for that refund, they can't change the adjustment to get part of it with each paycheck. Though if your income tax owed is consistently 0 you can file a w-4 that makes him as exempt from FICA withholding. Just be sure to file a new w-4 if your income rises.

 

 

Got it, thanks. That's really too bad the "throughout the year" part went away. Talk about going after the more vulnerable.

[LucyStoner]

Got it, thanks. That's really too bad the "throughout the year" part went away. Talk about going after the more vulnerable.

Yeah, from 1999- 2002 I was claiming my brother because he lived with me the whole year. Considering I graduated from high school just prior, I qualified for the EIC. When I realized I could get an extra bit of $$$ a month on my paycheck at my main job, it was a huge boon. We were so much better off. When I started volunteering to do taxes formally I realized that had been axed. Seems to dis-incentivize savings for low income earners.

 

ETA- a great way to help low income families and get a really good entry into understanding poverty is to volunteer to do tax returns with United Way or AARPs VITA program for volunteer tax preparers. A lot of people get scammed by paid tax preparation places for a significant chunk of their EITC refund. It's predatory and takes money out of pockets that really need it. Many low income people can file their own taxes online for free just fine but others are intimidated by it or don't have access to a computer. The volunteer tax prep sites are free and it's all taken care of. I can't stress the number of people who aren't working 1 or 2 jobs but 3 or 4 PT things strung together and they are bringing home peanuts. One woman had W-2s from 8 places. 6 of them were from the same job vending, she was just paid a little from here and a little from there to avoid paying her benefits. People have this idea that low wage workers are all young, inexperienced or just looking for a side income. That idea doesn't match reality. I've done so many returns for people who work almost FT and are still living in a truck. If you don't want to do taxes, you can check people in or volunteer to help people find resources they are eligible for but may be going without (like WIC or housing aid). It was just a 4 hour shift commitment weekly.

[Lisbeth]

Delayed gratification has a lot to do with wealth.

I think this is spot on. Delayed gratification is a key element to building wealth. I have seen it in my family and dh's. I have seen it in the Asian immigrants whose children play in my children's orchestra.

 

My parents grew up with dirt floors and via hard work are wealthy. My husband's grandfather was given up for adoption because his mother was so poor, and he died recently a very wealthy man. There are many examples like this in our families.

[Greenmama2]

Please don't flame me! I have an honest question for people who have BTDT. Please don't get preachy if you haven't BTDT.

 

I have friends from across the spectrum of wealth and cultures. I've noticed that many of my upper middle class friends buy used clothes, used cars, even used jewelry. OTOH, many of my friends who have financial struggles have fancier clothes, cars, bikes, etc than me.

 

Can someone explain this cultural phenomenon? Also, I've lived across the USA, so I have come to recognize some regional differences. I'm in the midwest currently, if that helps. I think things were different when I lived in Cali.

 

Emily

(who loves her used car, used couch, second-hand jewelry, and $20 bike, and is packing used clothes to take to the thrift store she shops at)

 

Well I'm not in the US and I have seen the same thing all my life. My better educated, usually higher income earning friends and acquaintances are the ones who choose second hand. Those people I know who buy new all the time, new clothes each season (for adults, as opposed to growing munchkins), the flashiest new car they can etc are all less educated and usually also earn less.

[Lisbeth]

People used to be able to get the EIC throughout the year in their paychecks. That went away about 4 years ago so many people have to wait until tax time for that refund, they can't change the adjustment to get part of it with each paycheck. Though if your income tax owed is consistently 0 you can file a w-4 that makes him as exempt from FICA withholding. Just be sure to file a new w-4 if your income rises.

Is an EIC really a refund? I have always found the word refund interesting around tax time.

[LucyStoner]

It's a refundable credit. Some credits are not payable if the credit exceeds the amount of tax you would owe. So while it can function as a negative tax (receiving more than you pay), it is termed a refund and is commingled for most with some over withheld wages.

 

The EITC lifts many families above the poverty line and functions as a lifeline for the working poor. It's only available to people who are working.

[creekland]

After a decade of working my ass off, for one year, I will be at a high "income" level. But it tells an incomplete story. Some of that will go away in May, when my dd graduates high school and her benefits on her father's record stop - just in time for her college. When my son graduates high school, his benefits will go away and I will stop working 7 days a week. Although I will have a full time job, and a small private practice, I won't make up the income I have for the next 5 months - but I will have MORE, not less, expenses with my kids in college and my FAFSA reflecting a very inaccurate picture.

 

Make sure you are in contact with an adult in the Financial Aid office at the college she will be attending.  We had a high income year last year due to selling a piece of property that was a huge part of our retirement portfolio (roughly 70% of it).  A cash buyer came to us (we didn't have it advertised) and we thought the benefits were worth doing it.  However, there's no way I wanted to lose it all by being full pay for my boy's private colleges.  

 

When we explained the situation to the colleges (two), both worked with us individually.  Youngest's school (he would be an entering freshman) told us step by step what to do and was awesome about the whole deal.  Middle's school (he would be a junior) didn't do much at first, so middle son filed an appeal and backed it up by a ton of support from his profs, research and club leaders, etc.  Then they were awesome.

 

Both boys knew our Plan B had to be for them to take a year off, but we didn't have to.  We were back to our "real" EFC, and that was affordable for us.  It's not even half of full price.  (And none of the rest is loans for them - it was all grants.  They have the traditional/basic federal loans that will have them graduating owing about the same as a new car payment, but we feel that's worth it for their education.  We also have no parent loans.)

 

But if all the colleges see is the FAFSA you file, they have no way of knowing that your case is unusual.  In our experience with our schools, the Financial Aid gurus have been terrific.  Not all schools have the finances to be so generous, so it can be worth the time to check out schools of interest to see what is possible ahead of time.

 

"Whether you think you can or you think you can't, you're right."  Quote attributed to to Henry Ford.

 

...

 

And now I'm wondering:  what do cynical people teach their children about their futures?  Do they tell their daughters they may as well not bother to fight for anything because they can't succeed?  Or do they tell their kids something different from what they tell themselves?  Which reflects what they really deeply believe?

 

I'm not cynical - I prefer to think realist.

 

From a VERY young age we taught our boys that Rule #1 in life is that "Life's Not Fair, You Better Get Used to It."  This is followed closely by the fact that for many, "It's All About the Money" so realize that and learn to deal with it.

 

So far, my guys are doing well.  None are likely to become millionaires, but that's never been a family goal so I sure don't mind that they haven't adopted it as a personal one.

 

I can't stress the number of people who aren't working 1 or 2 jobs but 3 or 4 PT things strung together and they are bringing home peanuts. One woman had W-2s from 8 places. 6 of them were from the same job vending, she was just paid a little from here and a little from there to avoid paying her benefits. People have this idea that low wage workers are all young, inexperienced or just looking for a side income. That idea doesn't match reality.

 

This is what the guy I met a few years after his high school graduation was doing when it hit him that things COULD be different if he went to community college and worked for an education to get into a career that paid better.  It was not an easy decision and he did have some loans to pay back plus had absolutely no free time for those couple of years.  He also had absolutely no regrets about his decision other than he wished he had done better in high school and did it right after high school rather than going through his hard working/poverty years.

 

Some do realize life can change on their own.  Others can be directed toward it.  And others feel life can't change, so why bother.

 

I also know some who just don't have the people skills to hold a job for long - even when they have a desired education to get them decent jobs (they've had these jobs, but can't keep them).  But again, when they aren't open to change (or can't change), there's not much that an outsider can do.

 

Sure. My frustration is people not understanding how debilitating struggling, and sometimes failing to meet needs can be.

 

It's debilitating for me at times, and I have smarts and support.

 

Can you imagine how debilitating it can be for someone who doesn't have smarts, isn't able to manage money and has no support ?

 

It takes considerable energy to drag yourself to the point of thinking the happy thoughts. This is what not having enough to meet your needs does - it grinds you down.

 

My personal view is that you stop grinding people down - maybe through low or no fee tertiary study, or the provision of social security, better and more widely available mixed housing, changes in monetary policy, fee free bank accounts for people who can't maintain a minimum balance or a million other things we can do together and THEN when people are not trying to perform mental triage on themselves every morning, then you ask them to think bigger and more optimistically.

 

 

And many of us do understand.  I haven't heard anyone say it's easy.  Most of us replying did not come from wealth.  My family was lower middle class - then my parents divorced.  In my marriage we started life living paycheck to paycheck and that didn't really change until hubby's business started to do well.  And "well" is relative.  We aren't even close to being millionaires.  We could possibly be if we changed our spending habits (college tuition, travel, stopped giving to charities and others), but it's just not a goal of ours.  We used to have a bit more, but lost a bit of that through investments and far lower income during the economic downturn.  Such is life sometimes.  It's not worth dwelling on.

 

Here in my area of the US, Community College (with several career paths) can be obtained for a relatively low cost.  Some of that cost can be in federal grants.  There are different aid options from food stamps to housing and heat, etc.  We also have inexpensive housing - unlike many of the big cities like NYC.  There's no way WE could afford a million dollars for a place to live either FWIW.  Our bank account is free with no minimum balance needed.  It's available to anyone choosing them as a bank - not just us.

 

Both hubby and I chose to move to our area when we saw that it had many things we needed for settling down and raising our boys.  Neither of us grew up here or nearby.  We have no regrets.

 

Not everyone is open to moving or can move for very legitimate reasons.  But for those who are and can, it's worth considering if there are opportunities elsewhere.

[Guest]

For practical suggestions, read The Tightwad Gazette. This is an older title. Some of the advice is outdated or now illegal. Some is off-the-wall. But there are many money saving tips that still apply today. They are not the ‘give up your daily latte’ suggestions so common among more current authors. Even so, following the advice in the book is not a quick fix. It won’t be enough for the truly destitute.

 

For those struggling more with overspending than lack of income, Your Money or Your Life provides a different perspective than The Millionaire Next Door. Both are eye opening.

Both The Tightwad Gazette and Your Money or Your Life are my Gospel Truth. i credit those two books more than any others as to giving me the perspective needed to accomplish what I have today. Even though the info itself is mostly out dated, the overall ideology is fantastic.

[Guest]

Sure. My frustration is people not understanding how debilitating struggling, and sometimes failing to meet needs can be.

 

It's debilitating for me at times, and I have smarts and support.

 

Can you imagine how debilitating it can be for someone who doesn't have smarts, isn't able to manage money and has no support ?

 

It takes considerable energy to drag yourself to the point of thinking the happy thoughts. This is what not having enough to meet your needs does - it grinds you down.

 

My personal view is that you stop grinding people down - maybe through low or no fee tertiary study, or the provision of social security, better and more widely available mixed housing, changes in monetary policy, fee free bank accounts for people who can't maintain a minimum balance or a million other things we can do together and THEN when people are not trying to perform mental triage on themselves every morning, then you ask them to think bigger and more optimistically.

 

People already feel ashamed about not being like others. They don't need extra helpings as a motivator.

I agree with you, Sadie, completely. I do know how folks get ground down by lack. The state of my childhood home was humiliating. It affected my ability to make friends as a teen, because I never knew whom I could trust to know how our home was.

 

As an adult, people have been surprised that I did not go to college in the normal time frame. They can't imagine why an intelligent woman like me would not have done so. But the fact is, I didn't even consider it at the time, because I needed to work. I did not have parental support to go to college; girls did not do that and I was pretty enough to get married, KWIM?

 

I also did not darken the door of a thrift shop for several years in my late teens and early twenties. I was too mentally affected from when that was the only option. I do it now and there are many fantastic thrift stores nearby, but I know the reason it does not bother me is because it is my choice. I am thrilled to get a beautiful sweater for $5.00 used, in part because I do it by choice.

 

In my early twenties, I could have better used my small income. I needed professional-looking clothes for the office where I worked but I could not buy clothes at Talbots, where a blouse is $65. I bought cheap Kmart blouses. But it would have been much smarter to go to the "upscale" Goodwill (where I just was this past weekend) and buy clothes there. I didn't do that then because I had been ground down as a child, when all we could do was buy clothes at Goodwill, or sift through the grab bags church people gave my parents.

 

That is why I say I know poverty is complex.

[SKL]

I guess I don't get the term "grinding down" in the context of having some help but not as much as might be ideal.  It seems an unnecessarily "glass half empty" view.

 

I also get the sense that some people want to feel that their relative misfortune is because some other people are out to hurt them.  To me that just seems irrational.

 

It's one thing to talk about how we could do things better to help the situation.  There's room for innovation in every field, including human services.  But before a helpful conversation can be had, the parties need to demonstrate mutual trust.  I wouldn't waste my time on a conversation with someone convinced I was "grinding them down" "on purpose."

 

I've been on both sides of this too.  I was poor, and I have been spent a significant amount of time working on improving things for poor / low-income people throughout my adult life.  So I am not just talking as a person who doesn't understand struggle.  I've done my fair share of struggling.  But I think the "blame game" is mostly a waste of emotional energy. 

 

As Quill mentioned above, the most freeing moment in my life was the moment I realized that everything I did was a choice.  If I worked all night to get something done, it wasn't me being tortured by slave masters, it was my choice to present a good work product in the morning.  If I worked for an asshole boss, it was my choice not to send out my resume - and I could choose differently the next day.  Maybe I had positive reasons to stay in the job; great!  I could choose to focus on the positive until circumstances changed.  Choice does not mean I blame myself for everything that isn't perfect; it means nothing is accomplished by feeling victimized.  One can accomplish more by focusing on the powers one has.  Even if that just means taking better care of one's own spirit, body, and personal space.  Instead of "I'll never have ___," it really is mentally healthier to focus on what one has and what one can do.  I don't care what some cynical writers and protestors say; they don't actually care about my personal mental health and happiness (or yours).

 

Now I know some readers are muttering, "I didn't choose to be ill.  I didn't choose to lose my job.  I didn't choose this economy."  Right, and I didn't choose the factors that made me feel suicidal in my early 30s either, but I could still choose so many things.  And whatever *I* did was in fact a *choice.*  And realizing and focusing on that truly made all the difference for my well-being.

[MomtoCandJ]

Do you mean allowances, rather than exemptions? I believe there is no limit but if you claim more than 10 the IRS will double-check the amount and tell your DH's employer if it's too many. Did the employer actually get a letter from the IRS telling them he could not claim more? The worksheet they use on the W-9 is just a suggestion as far as calculating allowances. One year we ended up in a very weird tax situation (don't ask) and we claimed something like 24 allowances and it was fine.

I thought you can only get one per person in your home so for us it would be dh, dd1, dd2, and myself. I do our taxes, I'm sure there are things I could deduct but don't since it wouldn't be over the standard deduction.

[JumpyTheFrog]

Sadie, it sounds like housing costs are totally out of control in your area. Most of the US is not nearly as expensive. If you wonder why some of us aren't as cynical, it's because we still have plenty of cities and states with more affordable housing. Not every place is like San Francisco, NYC, or DC. I live about twenty miles outside one of my state's largest cities and decent houses here are under$175,000, if you are content with 1500-1700 sq ft and 1/4 acre. Property taxes are also low.

 

In my home state, however, school/property taxes are killing people. My parents pay about $6000 per year. My mom's cousin left NJ about ten years ago because he was tired of paying $10,000 per year in school taxes. States very a lot in how carefully they use their money and what services are available. In my parent's case, every town is its own school district, with a highly paid superindentent, its own bus garage, etc. My 3rd grade gym teacher is earning about $90,000! A classmate who has been a high school math teacher is earning about $68,000 after eight years of teaching. Teachers are paid well there, but the taxes are very high.

 

In my current area, teachers are underpaid and taxes are low. I think we need a middle ground between this situation and the situation in NY where often teachers are one of the high paid jobs in an area.

[LucyStoner]

This is what the guy I met a few years after his high school graduation was doing when it hit him that things COULD be different if he went to community college and worked for an education to get into a career that paid better. It was not an easy decision and he did have some loans to pay back plus had absolutely no free time for those couple of years. He also had absolutely no regrets about his decision other than he wished he had done better in high school and did it right after high school rather than going through his hard working/poverty years.

 

Some do realize life can change on their own. Others can be directed toward it. And others feel life can't change, so why bother.

 

I also know some who just don't have the people skills to hold a job for long - even when they have a desired education to get them decent jobs (they've had these jobs, but can't keep them). But again, when they aren't open to change (or can't change), there's not much that an outsider can do..

Sorry to burst your bubble but some of people in low wage jobs have been to community college and then some. Some have been at those jobs for years or for as long as they aren't caught up in a layoff. Some have been to school, blown their financial aid availability when young and can't go again unless they can pay. Others may be ineligible due to a drug conviction. Others don't have the time after work and caregiving obligations to go school. Most adults who leave college for more than 2 quarters will never go back.

 

It doesn't help that community college tuition has risen here by more than 300% since I went.

 

Look, I'm a cheerleader for education. I've been to university and I started, due to a last minute change of plans (giving up college and a scholarship across the country to take care of my brother), at the local community college. I am getting still another degree right now. I love education. But I am blessed with a strong aptitude for the skills needed to be successful in school and a very strong high school education.

 

I'm not pessimistic. For the love of all the things don't call me pessimistic. I ran a family services non-profit which granted direct aid primarily for families where one or both parents were non-traditional college age students. I sat on the board of an organization which helped formerly homeless and at-risk young adults graduate from college. I helped found an organization that mentors/tutors released prisoners in college. One of the places I work for teaches college classes for legit credit to people in prison. I say all of this not to brag but to underscore, please do not write me off as a Debbie downer pessimist. I wouldn't have done those things if I didn't think that it was worth the effort, would I? I believe in the transformative power of education. I've seen it work time in and time out. But I see all the variances and there's no simple solution here. The barriers that some face to college or out of low wages are nearly or in fact insurmountable. That's why we need to concern ourselves with helping people IN poverty and not just focus on thinking everyone can or will get out of poverty.

[leeannpal]

I don't think too many people are denying the role luck plays. Hard word and delayed gratification are *necessary* but may not be *sufficient* to climb upward in income over the long term. Is it really so hard to believe that *some* people stay stuck or fall into in poverty mostly because of foolish choices? Just as it's wrong to assume all the poor are lazy fools, it's wrong to assume that they all make wise decisions. I understand that people are tired of the "poor= lazy" stereotypes, but it does no good to anyone to defend the decisions of some poor people to overspend on luxury purses and cars. Sure, they can use their money as they see fit, but don't get mad when people say "Hey, maybe they shouldn't spend $800 on a purse when they have no emergency fund." And even if it were from a thrift store, they could sell it to get money for an emergency fund.

 

Every time we have these threads, anyone who points out anything that seems like overspending is berated with cries of "Stop judging! It may be a gift." Sure, sometimes it is a gift, but that still leaves a lot of people trying to buy status in ways not necessary to get or keep a job.

 

I know I get tired of the assumption that "poor people" aren't trying to make a better life for themselves. My family isn't poor, but we aren't where I would like to be financially. I can assure you that we are trying to better our financial situation, but it won't happen overnight. And, in the meantime, we still need to live. And living cost money.

 

[leeannpal]

"Whether you think you can or you think you can't, you're right."  Quote attributed to to Henry Ford.

 

Quips aside, there's a lot of wisdom more profound than I am capable of that says you can do it if you decide to do it.  Sometimes it ends up looking like a series of lucky breaks or whatever.  Who cares what other people call it if it works? 

 

But if you are invested in the belief that the deck is stacked against you, there's nothing anyone else can do to fix that.

 

And now I'm wondering:  what do cynical people teach their children about their futures?  Do they tell their daughters they may as well not bother to fight for anything because they can't succeed?  Or do they tell their kids something different from what they tell themselves?  Which reflects what they really deeply believe?

 

I know you really believe this because things have worked out for you. My father had the most optimistic outlook on life of anyone I know. He really believed that he could own a business and do well with it. And he did for almost 40 years. And then the economic depression happened. He may lose the business soon. While he still believes that Capitalism is the best economic system in the world, his optimist ideas that anyone can succeed if they just try hard enough have been tempered greatly. He now understands that luck has much more to do with success than wishful thinking. Oh, and we are both Christians, and the Bible bears this out too. Remember, "it rains on the just and the unjust."