This is not an unusual problem. Barbara Ehrenreich has done two books on the subject, one at the low end of the pay scale and another at the high end. Bottom line, people fall through the gaps in the economy (they’re not mere cracks) and not necessarily (or even usually) though any fault of their own.
BTW, no one has mentioned it yet but, in my personal observation, this problem is even more accute on the other end of the spectrum. As difficult as it can be breaking into a career, more difficult still is switching jobs/careers after age fifty. I know several people with great resumes who simply cannot get jobs. Sure, it’s age discrimination and illegal. Prove it.
Count me as another person who thinks you’re being unrealistic. You can slow down a catastrophic situation, but sometimes you can’t stop it. Savings can run out. Illness can make you unhirable…family illness can pull you out of the workforce as well.
You’re speaking in terms of people who can buy stuff. We’re talking about people who can’t afford new shoes, let alone a new car. How much money do you think you can save when you’re working two or three mcJobs just to make ends meet?
I got lambasted for this when I posted it several years ago, but…
I believe (without proof) that denial of homelessness is simple denial. If you can blame “those lazy bums”, then you never have to admit to the ugly underside of society. Further, you never have to face the possibility that it could happen to you.
Very true. When I was unemployed and looking down the barrel of homelessness four years ago, I wasn’t trying to decide between the new car and a mobile home. I was wondering how I was going to pay rent by the next week.
To say that one could always afford something slightly cheaper than a new car is to vastly misunderstand what poverty is.
Ooh Ooh…I can go ahead and post the impending response to this…
These people should have advanced themselves or learned a trade so they could afford a mobile home (one of the worst investments you can make with your money…you are better off renting much of the time)
which of course doesnt take in to account a million real world scenarios where this is either not possible or the person finds themselves unable to use their skill/trade/education because of a million other real world scenarios.
I hear this kind of drek a lot from 20 something people who have acchieved at least some mild level of success after school. You almost never hear it from older people who have a lot of life experiance.
Here’s another example of crap people might spend their money on instead of saving for the future:
A couple of years ago, my mother came out to visit me, and got sick during her visit. She had stomach cramps that were bad enough that we took her to the local emergency room, and she stayed in the hospital for a week. She didn’t have surgery or anything like that. The final bill (I know this because they were, for some reason, sending them to her at my address for a while)- $40,000.
Fortunately, she was covered by insurance. Not everyone is. According to the census, 45.8 million Americans aren’t. It’s not always easy to find a job that offers health insurance, especially if you don’t have a lot of marketable skills, and private health insurance is expensive and near-impossible to get if you have pretty much anything like a chronic condition. And insurance companies will try their damnedest to get out of paying medical bills- I know she and my dad had to fight with their insurance company to get them to pay her hospital bill.
Should everyone have $40,000 or more sitting around in their bank account? That’s a lot of money, even if you’re making much more than $30K a year. Or should people who don’t have the money and don’t have insurance just not get medical treatment when they need it (and possibly suffer unnecessarily, or even die)? Should those of us with insurance avoid telling our doctors about any chronic problems, just in case we end up having to go on private health insurance at some point in our lives? I have experience with untreated depression and anxiety, and it’s a living hell. It’s even worse if it’s something like diabetes or glaucoma or cancer that’s going untreated- you can get permanent damage from not getting early treatment, and in the case of diabetes or cancer, you could die.
In the midwest the machine tool and automotive industries are being shipped abroad. We are talking of skilled workers, engineers, accountants designers and computer experts. The work they do will be done in India at 5 grand a yr. It is the educated who are in jeopardy. Restaurant workers and service emplolyees are still needed.
This country will change radically in the next few years. I suspect the homeless will grow.
To answer your first question, finding a job is not a problem I worry about. I’m currently looking for a job that I would enjoy doing and those are the jobs I’ve interviewed for. I’m assuming that makes sense to you.
Where I’m going with the personal responsibility thing is that I’ve been on this planet for 48 years and in my opinion the act if financial planning is almost non-existent in the United States compared to my parents generation. There is a correlation between a lack of planning and financial ruin.
Are you referring to the fund that I and my employer paid into for the last 25 years for the express purpose of unemployment? I won’t even approach what the state received from me.
Which was my point. It is failure of society to turn out children who cannot take care of themselves as adults.
That wasn’t the question at hand. But since you asked…. A mandatory class in personal finance in grade school and high school is the only method I can think of to replace what is not being taught at home.
I haven’t run into that yet at age 48 but I believe it exists in certain fields (such as programming). I’m not sure it’s age discrimination as much as supply and demand. If a younger person is equally trained they are a better value when they start out on the first rung of the ladder. My interviews have gone fairly well and I would have been employed right now if the person I was replacing had not decided to stay. I agree that switching jobs would be difficult and I’ve drawn up a number of plans to address that.
That’s the one. You know, the one where people who aren’t unemployed pay in money to help support people who are unemployed. “From each according to his ability, to each according to his need”, you might say.
Well, the chief “question at hand” here seems to be “Is there really a problem with homelessness in the US?” You seem to be suggesting that a significant amount of today’s homelessness is ultimately due to avoidable extravagance and poor planning, and I wondered if you had any data to support that.
On the other hand, if the vast majority of today’s homelessness problem is not ultimately due to avoidable extravagance and poor planning, then mandatory classes in personal finance, or other measures to encourage better financial planning by individuals, won’t be that much use in addressing the problem.
What I’m saying is that a lot of it was self generated due to a lack of planning. Basic financial planning is like a seatbelt. It cost’s nothing to practice and saves a tremendous amount of grief in the event of an accident. Stop reading it as a cure and look at it for what it is.
Cell phones, cable TV, cigaretts, high speed internet, new cars, dining out, and fancy clothes are luxury items. These are all things that should be purchased AFTER you’ve payed for insurance and put money away for unforseen events. Yes people make mistakes. I went from owning a new car to driving a 74 Maverick that was so rusted I used foam insulation to keep the back quarter panel on. I didn’t have to do this except I anticipated my company going under. It did. Guess where the money saved went? I dumped cable, paid my house off and all my credit card debt. That’s financial planning and it doesn’t touch what my parents did to survive. Could the company have gone under before I was able to handle it as well as I’m doing now? Absolutely. Did my planning help? Absolutely. This is not a holier-than-thou lecture but a statement of opinion on the status quo of savings and financial planning in the US.
IMO a lot of middle class failure could be eliminated through planning.
No That’s a government mandated insurance. If they weren’t involved in the process I’d have over $100,000 in the bank instead of $343 week. But politicians act as if the public is too stupid to handle their own financial affairs and so I’m screwed out money I will never see a fraction of.
What I’m saying is that financial planning works. You want to tie every homeless person to it. If you would allow for just a little common sense in a discussion you would understand who would or wouldn’t benefit from financial planning.
Um…If your talking about unemployment, thats not how it works. The person who is unemployed draws out money from the fund they paid into. They arent getting your money.
If you want to talk about insurance problems that’s fine but your question is lame. No, person should keep $40,000 in the bank in case of health problems. That would be financially foolish if it were possible. But when you talk about an income of $30K you are in the financial realm of personal insurance. I opted out of COBRA because it was cheaper to insure privately. I have $7M insurance with a $1750 deductable. This costs less than half of the COBRA payments and I have better catastrophic as well as remedial insurance. In the event of a small medical problem ($12,000) I’m paying less than when I was “fully insured” with an HMO from my last company. These aren’t numbers I made up because I had to pay the bills from a minor operation.
The poor and homeless are covered by medicaid and middle/upper income people usually have an HMO. The gap in medical insurance are the near-poor who have problems covering the premiums of even a basic insurance program. That is an entire subject unto itself.
I think this depends on the jurisdiction you’re in. Most “insurance” plans of any sort simply do not work the way you describe; you pay premiums to the insurance company and they pay you if your policy is triggered. In fact, the payments in amny cases ARE paid by other people. If your house burns down the insurance company will pay you money paid by other people; unless you’re a total idiot who got scammed by a real thief of an insurance agent, or in some weird circumstance, there’s no way you should ever pay as much in home insurance as you would be paid if your house was destroyed. If I paid my home insurance at the rate it’s at now I would have to pay it for ninety years to pay as much money as they will pay me if it needs to be replaced.
The entire POINT to catastrophic insurance, like home insurance or big time health insurance, is to do exactly this. By spreading the pain out among all policy holders, nobody gets screwed if their number comes up and they lose their house or something. Since most homes don’t burn down, most everyone pays less than they would pay for a new house.
Unemployment insurance, in many jurisdictions, also involves people paying you benefits. You MIGHT pay more than you get back, or you might not. What is for sure is that in many cases your UI premiums are actually going into the government;s general revenues, just like taxes, and benefits are coming out of the same pot. While in most cases your benefits are tied to what you paid, it’s not always that clear a relationship; again, it depends where you are.