# Why people are still poor **URL:** \ **Category:** Great Debates\ **Created:** [July 4, 2003, 5:15pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257 "2003-07-04T17:15:29Z")\ **Posts on this page:** 14\ **Page:** 4
**Author:** ![KellyM](https://avatars.discourse-cdn.com/v4/letter/k/57b2e6/32.png) [@KellyM](https://boards.straightdope.com/u/KellyM)\ **Post date:** [July 6, 2003, 7:31pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/61 "2003-07-06T19:31:19Z")
I should also point out, **sinful** , that if you have more than $2000 in investments you are ineligible for virtually all forms of welfare. And the average award is around $300/month, which is nowhere near to your $10,000. I wonder where you’re coming up with such ridiculous numbers. And what about child care? Medical expenses? ---
**Author:** ![desdinova](https://avatars.discourse-cdn.com/v4/letter/d/8baadc/32.png) [@desdinova](https://boards.straightdope.com/u/desdinova)\ **Post date:** [July 6, 2003, 7:41pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/62 "2003-07-06T19:41:04Z")
> [@](#): > > \*Originally posted by KellyM \* > \*\*I should also point out, **sinful** , that if you have more than $2000 in investments you are ineligible for virtually all forms of welfare. And the average award is around $300/month, which is nowhere near to your $10,000. I wonder where you’re coming up with such ridiculous numbers. > > And what about child care? Medical expenses? \*\* I had typed up quite a bit in response to **Sinful** ’s “assertions”, but IE crashed and I don’t feel it’s worth it to retype it. My biggest question, though, is what the hell is “you can make up to $37,000 per year” supposed to mean? For that matter, are you calling people making $37,000 a year “poor”? I suggest **Sinful** go visit some public housing projects, 'cause if he/she thinks $37,000 per year (U.S. dollars? Canadian? either one, in any event) is poverty, well, ::shudder:: Furthermore, **Sinful** , if you want statistics to back yourself up, you might want to spend a little time with the fine folks at the [U.S. Census Bureau](http://www.census.gov). These [poverty thresholds](http://www.census.gov/hhes/poverty/threshld/thresh02.html) might be a good start. ---
**Author:** ![Gorsnak](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/gorsnak/32/7587_2.png) [@Gorsnak](https://boards.straightdope.com/u/Gorsnak)\ **Post date:** [July 6, 2003, 7:51pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/63 "2003-07-06T19:51:03Z")
> [@](#): > > my parents get welfare, even though they both work fulltime Where is that legal? Sounds like fraud to me. ---
**Author:** ![KellyM](https://avatars.discourse-cdn.com/v4/letter/k/57b2e6/32.png) [@KellyM](https://boards.straightdope.com/u/KellyM)\ **Post date:** [July 6, 2003, 8:09pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/64 "2003-07-06T20:09:45Z")
**Gorsnak** , I’ve seen families where it happens, but generally it requires that you have either foster children or children with exceptional needs in the house (which can get you access to Title IV-A funds without regard to family resources). It depends on what you characterize as “welfare”, too. If you consider the EITC to be a form of “welfare”, then it’s easily possible to get “welfare” while working full-time. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [July 6, 2003, 8:13pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/65 "2003-07-06T20:13:09Z")
Guys, there is no point tilting at **Sinful** ’s windmill. He’s young, he’s proud of his savings, and he’s unaware of how unrealistic he’s being. So, he managed to save 70% of his meagre income. Great. More power to him. Better than blowing it on drinking and new cars. All he’s pointing out is that a young single person with no debts and no commitments doesn’t need much to live on. That’s certainly true - when I was in University, I lived on less than $10,000 per year, quite comfortably. I shared a $400/mo apartment with a roommate, had my car paid for (I worked for three years before going back to school), and I wore ratty clothes. Fine. Now try it with a wife and a child, when you are required to dress well for work, and you have to pay for day care if your wife works. Not so easy. But still… Given that lots of people live on, say, $18,000 per year, there is no _physical_ reason why a young family that earns $40,000 per year can’t save $10,000 of it. The fact is, we choose not to, because we increase our standard of living. Once you get that big raise, you dump the junker you’ve been struggling with, and buy a slightly nicer car. Or perhaps you haven’t been on a vacation for five years because you couldn’t afford it, so once you finally get some real money you treat yourself. There is nothing wrong with this. Hell, my wife and I together make well over $130K a year, and when we were younger we made the same mistakes. We had credit card debt, a big mortgage, a new car, a second used car, and we were living paycheck to paycheck despite having an income that put us in the upper middle class. A decade ago we smartened up, stopped spending beyond our means, sunk every spare nickel into our debts and cleared them off, and now we make sure our credit cards are fully paid each month. We set up auto-deductions from our bank accounts to put the money into investments. If you never see it, you don’t miss it. I really, really wish I had figured that out when I was twenty, instead of thirty. It would have given us a big head start, and removed a lot of stress from our marriage. And today my net worth would probably be twice what it is. So there’s a very valuable message in the OP, which a lot of low to high middle class people should learn. You CAN become ‘rich’ through saving. But more realistically, you can avoid becoming poor if you have a reasonable salary, by being responsible with your money. ---
**Author:** ![doreen](https://avatars.discourse-cdn.com/v4/letter/d/858c86/32.png) [@doreen](https://boards.straightdope.com/u/doreen)\ **Post date:** [July 7, 2003, 12:11am UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/66 "2003-07-07T00:11:29Z")
> [@](#): > > My budget is simple. School amenities fees and books comes to around $1000 per year (second hand books are cheap if you buy them from older students). Rent is $50 a week (board), and sometimes I don’t even pay because I offer to do some odd jobs for the houseowner (I only paid $2000 last year for 40 weeks rent, the other 12 weeks I got for free for tutoring their kids). Entertainment is $3000 per year, which is around $57 per week (I usually go catch a movie with some friends, eating out occasionally, sometimes save up a bit for a vacation). That budget’s missing an item or two - like tuition ( I wouldn’t ordinarily count it as income- but In your case it should- I could invest 100% of my income if some other entity was paying all of my expenses) ,the subsidy that your receiving from the people you live with (and you are- they are not making a profit charging you $50 week for room and board) and taxes. ---
**Author:** ![Guinastasia](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/guinastasia/32/5751_2.png) [@Guinastasia](https://boards.straightdope.com/u/Guinastasia)\ **Post date:** [July 7, 2003, 3:04am UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/67 "2003-07-07T03:04:54Z")
The one thing that struck me when reading that article **John Harrison** posted is that the author of _Rich Dad, Poor Dad_ calls his father, “poor”, but the man was a university professor with a Ph.D. They were simply middle class. I don’t know about you, but I’d rather see my children with an education and comfortable than with tons and tons of money and no education. The fact that the book says, “You don’t need an education” to me is absolutely disgusting. ---
**Author:** ![The\_Calculus\_of\_Logic](https://avatars.discourse-cdn.com/v4/letter/t/aeb1de/32.png) [@The\_Calculus\_of\_Logic](https://boards.straightdope.com/u/The_Calculus_of_Logic)\ **Post date:** [July 7, 2003, 3:10am UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/68 "2003-07-07T03:10:35Z")
> [@](#): > > \*Originally posted by Sinful \* > \*\* > > My budget is simple. School amenities fees and books comes to around $1000 per year (second hand books are cheap if you buy them from older students). Rent is $50 a week (board), and sometimes I don’t even pay because I offer to do some odd jobs for the houseowner (I only paid $2000 last year for 40 weeks rent, the other 12 weeks I got for free for tutoring their kids). Entertainment is $3000 per year, which is around $57 per week (I usually go catch a movie with some friends, eating out occasionally, sometimes save up a bit for a vacation). > > How much is total? $6000. The rest of the money usually goes into improving the business, or saving up a deposit for IPs. > > Rent in a cheap suburb with rail connection is $7000 per year on average. Food, if you make it at home, is only $5000 per year (estimating at $13 per day, which is double my food budget). Other necessities are estimated at $5500 per year. CLothing, $500 a year for a factory worker is probably overboard, but lets pretend Mr Factory Worker is a really spiffy dresser (pants cost $100 on average, and you’re not going to throw them away in a year). Thats a total of $17,000. > > \*\* Not to be an ass, but pants don’t cost $100 a pair. I buy mine for $15 a pair. And $13 a day for food is a very high number if all you have to do is feed yourself from your own garden. You left out transportation from your budget as well, as i literally know of no suburbs with rail connections. I am guessing medical care is included in the $5500 of misc. a year, but it can be expensive if you come down with something. All in all, if you, as a 19 year old (however old you are, i assume 19), are saving 12k a year and investing it wisely then kudos to you. It beats alot of 19 year olds who go into debt spending their money on rims and abercrombie shirts. ---
**Author:** ![KellyM](https://avatars.discourse-cdn.com/v4/letter/k/57b2e6/32.png) [@KellyM](https://boards.straightdope.com/u/KellyM)\ **Post date:** [July 7, 2003, 3:17am UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/69 "2003-07-07T03:17:52Z")
**Calculus of Logic** , a lot of the Chicago-area suburbs have rail connections. About a third of the people working in the same suburban company as myself take the Metra to work, either from suburbs further out on the line or from within Chicago. ---
**Author:** ![CrankyAsAnOldMan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/crankyasanoldman/32/11670_2.png) [@CrankyAsAnOldMan](https://boards.straightdope.com/u/CrankyAsAnOldMan)\ **Post date:** [July 7, 2003, 2:20pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/70 "2003-07-07T14:20:53Z")
This is another one of those OPs which is disguised to be “I have an answer that will help the world!” but is really just a chance for the author to gloat about his supposed superior morals/values/wisdom/spending habits. Been there, done that, seen it before. ---
**Author:** ![SentientMeat](https://avatars.discourse-cdn.com/v4/letter/s/43a26b/32.png) [@SentientMeat](https://boards.straightdope.com/u/SentientMeat)\ **Post date:** [July 7, 2003, 2:44pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/71 "2003-07-07T14:44:17Z")
Of course, as **Shodan** ’s and **Sinful** ’s testimony illustrate, it is entirely possible to pull yourself out of poverty by the bootstraps though frugality, hard work and sensible life decisions. A hearty “good job!” to them and all those like them. Well done indeed. What is perhaps not being appreciated here is that the _natural capacity_ for making sound financial decisions and pulling yourself out of poverty is _itself_ something which many people find it difficult to attain, like maths, French or gymnastics. It would be _possible_ for me to become competent at gymnastics, but this would only be through truly monumental exertions which someone else might find wholly laughable or, worse, shamefully weak to the extent that I “deserved” whatever negative consequences my inability to perform gymnastics might arise. I happen to believe that personal finance and debt avoidance should be taught at school. Like any other subject, many will fail. To blame this failure _solely_ on the individuals themselves would be myopic in the extreme. ---
**Author:** ![KellyM](https://avatars.discourse-cdn.com/v4/letter/k/57b2e6/32.png) [@KellyM](https://boards.straightdope.com/u/KellyM)\ **Post date:** [July 7, 2003, 4:40pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/72 "2003-07-07T16:40:41Z")
**SentientMeat** , it should also be noted that not everyone has the luck (and, yes, luck is a component, like it or not) not to have had any of the many things that can ruin a valiant attempt to pull oneself out. Mainly, it appears that **Shodan** and **Sinful** are lucky enough to be in good health. Not everyone is so lucky. Managing to make something of yourself when you have no significant obstacles is not particularly impressive. I’m more impressed by my girlfriend and her husband, who managed to pull themselves out of poverty despite his destroyed knee (destroyed by the United States government, I might add), which dramatically impaired his ability to find and hold work. So, **Sentient Meat** , I advise caution lest you invert your claim to conclude, as **Shodan** routinely does, that those who have not successfully pulled themselves out of poverty have failed to do so solely because they lack “the natural capacity for making sound financial decisions”. All the sound financial reasoning in the world will not help you when your medical bills exceed the income you can earn when you’re not unable to work. And this is only one external reason why someone might fail to be able to pull themselves out of poverty. ---
**Author:** ![SentientMeat](https://avatars.discourse-cdn.com/v4/letter/s/43a26b/32.png) [@SentientMeat](https://boards.straightdope.com/u/SentientMeat)\ **Post date:** [July 7, 2003, 4:49pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/73 "2003-07-07T16:49:24Z")
Agreed, **Kelly** : My intention was to show that “luck” manifests itself in many more ways than receiving, or not, a silver spoon, as your friend’s story also amply demonstrates. ---
**Author:** ![msmith537](https://avatars.discourse-cdn.com/v4/letter/m/d9b06d/32.png) [@msmith537](https://boards.straightdope.com/u/msmith537)\ **Post date:** [July 7, 2003, 6:03pm UTC](https://boards.straightdope.com/t/why-people-are-still-poor/186257/74 "2003-07-07T18:03:20Z")
> [@](#): > > \*Originally posted by KellyM \* > **SentientMeat** , it should also be noted that not everyone has the luck (and, yes, luck is a component, like it or not) not to have had any of the many things that can ruin a valiant attempt to pull oneself out. > \*\* IMHO, one of the greatest barriers that people have to improving their lot in life is breaking out of the mindset of the class they were born into. Even if the opportunity is there, if a person does not recognize the opportunity or they feel that it offers little value or feel that their goals are beyond any realistic expectation, they are not going to go very far. Luck is a matter of being in the right place at the right time. The more educated you become, the better your chances of being able to recognize fiancial opportunities as well as an increase in the number of opportunities that come your way. [Previous page](https://boards.straightdope.com/t/why-people-are-still-poor/186257.md?page=3)