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.Read More
Financial struggle can become desperation and did with a friend of mine. About a month ago, on a Tuesday morning I got the kind of call you never want to get. A woman friend had ended her life over the weekend. I was shocked and the news hit me hard. While Deb and I hadn’t been living in the same area for years she always lived in my heart. Because of the economy the last few years, we knew Deb had, like so many others been struggling financially.
Laid off from one job she had a great deal of trouble finding another. She was skilled, but over 50 and if you think ageism isn't happening, you're wrong. Rumor was she may not have always had enough to eat or been able to pay her bills. Then she found another job and things seemed better – until she was fired the Friday before taking her life. I can only imagine the fear, perhaps embarrassment, and hopelessness Deb was feeling at that moment. And, then she made a decision many make in the moment of desperation.
But, Deb is not the only woman (or man – perhaps even harder for men to reach out to get help) suffering financially and suffering with the guilt, shame or blame of believing it’s their fault.
Over 24 million women were living below the poverty line in 2009
27.5 % of black women live under poverty line
13.5% of white women in 2009
In Nov 2013 in the State of California food stamp and welfare money was cut. One of my clients lost $100.00 a month from her disability and about $30 a month from food stamps. That's a BIG net loss for someone barely scraping by.
35% of households headed by single moms were “food insecure”
13% of women over 75 were poor compared to 5% of men over 75
Only 40% of women retire with enough money to live on. More women by far retire in poverty than men.
A working wage based on the minimum wage of 8.50 an hour = 17,000 a year – that’s considered below the poverty line.
2010 31.6 % of single women households were poor compared to 15.8 of households headed by single men
How we do help someone who may be in Deb's position? We reach out and past their embarassment or shame with kindness and gentleness by not asking, but just bringing food over for a get together, leaving an envelope with cash for bills, and letting them know we're there for them until they get on their feet again. One person can't solve every problem but a group of friends can make a big difference. I don't think many knew Deb's suffering - she was very private. We ask our connections and friends about job possibilities and try to support the person through the aloneness of struggle.
The larger question is how do we change financial struggle and poverty? Think about it and come up with your answers, but here are a few of mine:
1) We must educate ourselves about money, (there are TONS of resources FREE on the web)
2) Vote our conscience with compassion for those less fortunate
3) Reach out to friends and family if we get the sense they’re struggling more than they are able to say.
4) Collectively: A simple thing we can do is vote for a higher minimum wage to help more people out of poverty. When people are living in poverty they can't spend money on consumer goods as they're able to when more secure.
Is the middle class of old going, going, gone? Yes and the sooner we take our heads out of the sand of denial, the sooner we can strategize and create positive job solutions.
Here are economic facts of the last 40 years:
In previous recessions (2001, 1990-1991, 1981-1982, 1973-1975) mid pay jobs rebounded each time, but the net effect was still lost midpay jobs with each recovery.
In the recovery of 2001 there was a 5% net loss of midpay jobs, in 1990-91 a 20% netloss of midpay jobs, in 1981 32% net loss. In other words with each recession the recovery of midpay jobs has declined. The net effect is that the middle class has lost ground with each recession and recovery period. “Half of the 7.5 million jobs lost during the recession were in industries that pay middle-class wages, ranging form $38,000 to $68,000. But only 2% of the 3.5 million jobs gained since the recession ended July 2009 are in midpay industries.* Mid-wage jobs were 60% of recession losses but only 22% of recovery growth.
What about the poor? How do two working adults make enough money for rent, food and basic necessities on a $7.25 an hour minimum wage? They don’t. In California, the miniminum wage is $8.50 an hour. If the minimum wage was pegged to inflation over the past 40 years, the federal standard would be $10.58 an hour.* Still not much to build a better life on.
Who or what is to blame? It's more complex than this answer, but technology is the major culprit, though of course the housing market and banking excesses share the blame. Though we love our technology, it is the main problem in terms of recapturing lost mid wage jobs because robots, software and newer and better apps do jobs faster, cheaper and more productively than humans can. Companies understandably go for increased productivity and earnings and cheap, effecient labor.
What's the solution? First of all, letting go of the dream that things will go back to the way they were. Forget it. Let's move on. Then, we need our best, most creative economists, along with folks from the middle class and poor to brain storm short and long term solutions to job creation because, believe me, we are all in this economic soup together. If the middle class and poor continue to lose ground that affects all of our standard of living. We can create job solutions. We must start now and we can't leave that to Washington alone. (*“The Great Reset, Recession, technology kill middle-class jobs,” Modesto Bee January 27, 2013, ** Michelle Singletary, Mod Bee 1-27-2013)
Winter Money Blues? Zip Right Out of Them! Whether you're business women, or stay at home moms, it's the third dreary, cold, gray week of January. Christmas bills are coming in, the budget was blown, the spending high of December long forgotten and tax time is right around the corner. No wonder January is the longest month of the year.
Remember, we nearly always survive January anyway, but here's how to speed up the financial peace process.
1) Give yourself 1 hour or 1 day (depending on your needs) to REALLY feel the sadness, depression, angst of your situation. Moan, groan, complain, vent, cry, yell. Go into it and when that allotted time is complete - move on.
2) Financially Assess where you're at: Pull your ostrich head out of wherever it's been and take stock. Look at all the bills, count up the money owed, make a list of what's due, when.
3) Make decisions. You've got the list of money coming in and bills due. What's the loudest bill? What can you pay on it. Go down the list. Prioritize.
4) Send the payments. No matter how few or how small, actually sending the payments out feels good.
5) Congratulate yourself - Ta-Dah. "I did it." Call a friend and share. Feel good about the progress rather than always striving for perfection. There now - it's nearly February!
As a woman in business, who is also a Certified Money Coach, I know what it's like to struggle with money and how good it feels to take charge. Financial peace and health come with focus, prioritizing and persistence. Here's to you!
The 1.6 Billion Dollar woman in business, Facebook’s second in command, Sheryl Sandberg says “women need to keep your foot on the gas pedal and aim high.” Ms. Sandberg who was recently speaking at the World Economic Forum in Davos, Switzerland and her subject was women! Should Facebook’s launch go as planned Ms. Sandberg will be worth approximately 1.6 billion. She’s one of a very few self-made women billionares. Go girl!!
Sheryl Sandberg is to the promotion of women in business as Steve Jobs was to the promotion of Apple. Her focus on women makes perfect business sense for her role in Facebook as 71% of daily fan activity and 62% of all activity is driven by women*. Women need role models who aim high and are super successful. Young women flock to hear her speak because she’s so passionate about empowering them.
All high profile people generate some backlash and there are those that say her wild success is because, as a woman in business, Ms. Sandberg has had luck and advantages others don’t have. It’s true, most women in business don’t attend Harvard or Harvard Business School. But she’s noted to be “super smart and savvy,” has obviously put to good use her business education, training and “luck,” and she’s dedicated to supporting more women into upper echelon positions. Here’s a link to a YouTube video where Sandra talks about why women don’t make it into top positions and what to do about it. Excellent. http://www.youtube.com/watch?v=18uDutylDa4 (*NY Times, Feb 5th 2012 The $1.6 Billion Woman, Staying on Message)
Nice Girls Don't Get Rich author Lois Frankel, Ph.D (a rich woman in more ways than one) says that many of the characteristics that make women uniquely feminine are the very same behaviors that prevent them from becoming financially independent. What does she mean by that?
Women are socialized to be the caretakers and still today more women go into the helping professions than men, which don't pay as well as other professions. Ms. Frankel says she spent "the first half her adult life believing that doing good and doing well were mutually exclusive."
Take a look at this "nice girl" programming and see what you think:
* Money is power, and most little girls are not taught to be powerful - they're taught to be "nice."
There is a shared responsibility for the financial condition of the world. The 1% need to share their money more equitably. The 99% need to educate themselves about money and take their power back, or perhaps develop a sense of financial power for the first time. There’s something I realized this year and that’s how ignorant most of us are about our relationship with money. I came to this ah-ha while going through a five month training to become a Certified Money Coach.
Now that I can see more clearly, because my financial blinders have been partially removed, I get how little the collective us really understands about money. What does money really mean to you? Fill in this blank. To me money means________.* Most people say freedom or security. I like to add FUN. As a therapist/coach/business owner I’ve been interested in making more money, and read at least 50 books about money – how to make it, and make more of it, keep it, save it and manage it. But there's a deeper meaning to money that remains hidden for most of us.
The anger that the 99% feel toward the wealthy 1% can be a positive anger if it gets channeled in healthy ways. Yes, legislation that favors the 1% disproportionately needs to be changed. But, the 99% also need to take financial responsibility for their money ignorance and lack of power. We need to educate ourselves and there’s no excuse not to because the information is available. In the last ten years, not only do we have books available about the nuts & bolts of money (budgets, making more $$, etc), but most importantly how to change our emotional relationship with money. That’s where the real juice is.
I gave a presentation about Turning Financial Stress into Freedom to a group of multi-level marketers last week. It was really fun. These are folks that still believe in the American Dream and who are hard workers, and goal and success oriented. But, they will only be able to achieve their financial dreams if they understand and begin to transform their understanding of how they emotionally react and respond to money.
Here are 3 things I shared with them that may help you:
1) Raise your money consciousness by knowing how much money YOU need (not your parents, your spouse, your kids, your best friend) to make you happy. Write down that number________.
Research shows most believe that to be between $50-70K a year.
2) What is your earliest money memory?** __________ How does that memory affect your adult relationship with money today?
One woman at the talk shared that as a child she would ask her parents for money and they always gave it to her. Now, as a sales person she has no problem asking for the sale or the check.
3) How did your parents feel, talk about or behave with money? How do the thoughts, feelings & beliefs you developed in your family affect you today? "Your relationship with money is not just about money, it's about everything. Everything you eat, drink, fear & buy." David Krueger
*David Krueger The Secret Language of Money ** Deborah Price Money Magic
"It was the best of times, it was the worst of times...," wrote Charles Dickens in the 1800s. The same could be said now. Apparently for the top 1% of America it's the best of times. One of my questions since the crash of 2008 has been "Where has all the money gone?" According to the Congressional Budget Office the top 1% of U.S. households almost tripled their after-tax income from 1979 to 2007. For us middle class folks, after-tax income grew 40% and the lower end of the economic scale increased also, but only by 18%.(Modesto Bee 10-27-11 Rich getting richer more quickly)
But let's wait a minute. Hasn't wealth in America (& the world) always been unequally distributed? Yes and let's start by looking at what the definition of 1% really consists of. First, according to Joyce Apleby, emeritus professor of history at UCLA, there's income and there's wealth. To be a one-percenter you have to earn more than $700,000 a year (income) and have assets (wealth) of more than $9 million.
Ok, now we understand the basics of 1% economics. What's the economic truth for the rest of us? Have we middle class Americans been operating from an illusion that we could become rich? Yes and no. "From 1776 to the present, the bottom 60% of the U.S. population has never had more than 11% of the country's wealth." Hmm...Of course if you've done the math this 60% doesn't account for 39% of us.
Back to the question of, "Where did all the money go?" Well, well we know the banks got a lot of money. The investment bankers and hedge fund guys that is. But, I don't really think there's a simple answer to this question. We have a dream in America that hard work, luck and opportunity opens the door to fortune. That dream is a good one because it creates HOPE and in every generation the dream becomes true for a few. This "worst of times" economic recession is a wake-up call to look at the economic inequalities that have always been present, for the 99% to to keep the hope, the hard work and to hold the 1% accountable to a financially more equitable system for all.