3 Reasons Why It’s Expensive to Be Poor & What To Do!

What are 3 reasons it's expensive to be poor? I have to go back into time to explain this. When I was first working as an office worker in the Central Valley of California in the 70s, I made $10.00 - $12.00 per hour. That's about what starting office workers make today. Shocking? Thirty years have gone by and the cost of living? Well, you know.  I wouldn’t have considered myself poor at that time, but today, at those wages I would be. 

If you’ve ever been poor you probably know why it’s expensive to be poor. But, if not, why should we care? Because when people can’t afford to eat well enough or buy the goods and services they need, everyone, but especially the shrinking middle-class is affected.

When you're don't have enough money, simple sounding things from finding a job, to getting back and forth to work, to child care, to just buying enough food is way more difficult. Try feeding a family of 4 on $23,550 a year which is the annual threshold for poverty, or if single about $12,000 a year.

A Second Reason it's expensive to be poor? Pay Day Loans!! “If Visa offered an annual percentage rate of 391% would you take it?” asks CreditKarm blog? Of course not, you think. But, many, many people just trying to get their bills paid use pay day loans. 

If you’re struggling to get to the next paycheck and you see the “come on” blinking neon lights that promise relief and you don’t realize the hidden costs it's easy to fall victim to this type of loan. Payday loans are really a modern type of loan sharking. You don’t lose your arm if you don’t repay, but they carry outrageously expensive interest rates. These loans are immediate, but COSTLY and often create a vicious, hard to get ahead of cycle.

What's the third reason it's expensive to be poor? While there’s an illusion that “poor” people just need to get out and work, at least 11 million do, according to Charles M. Blow, N.Y. Times Op-Ed Columnist in a Jan 2015 article. The problem is they don’t make enough to get out of poverty. They're barely treading water. And, the new American standard seems to be working 2 or 3 part-time, minimum wage jobs. Crazy and exhausting!!

Last, think about this. Wages have not kept up with the cost of living. In 2004 the minimum wage was 26% less than in 1979. The poor often pay 50% of their income or more to housing which is one reason we’re seeing more homelessness – the choice becomes feed my family or have a roof over my head?

The solutions? This subject is bigger than a short blog can provide, but some suggestions include supporting income equality by voting for a higher minimum wage. Support childcare initiatives that provide income based subsidies. We are the only industrialized country in the world that doesn’t have a national child care policy. Try to be compassionate about the struggles of other Americans and realize we're all in this together. It's better for the economy and everyone when all have enough to live comfortably enough.