Author Topic: 47% of US households can't get $400 without borrowing or selling something  (Read 5157 times)

forummm

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The executive summary starts on page 9 of the PDF.

31% of non-retirees have no retirement savings or pension.

http://www.federalreserve.gov/econresdata/2014-report-economic-well-being-us-households-201505.pdf


I had some mixed feelings about posting this on the Antimustachian Wall of Shame and Comedy. Certainly some of these people are in circumstances that they had little control over, and I pass no judgment upon them. But I believe many of them are in this situation due to antimustachian decisions.
« Last Edit: May 29, 2015, 07:52:50 AM by forummm »

Sofa King

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The executive summary starts on page 9 of the PDF.

 many of them are in this situation due to antimustachian decisions.

The vast majority are in this category. 

I'm a red panda

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That is so sad.  $4,000 I could understand. But $400...wow.


Bob W

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

Insanity

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

I would be very happy paying that person a crap (pun intended) load more if that person where taking care of my parents.  I want to incentivize that person to care.

Of course, I would also pay social workers a lot more since they are dealing with real problems and real dangers.

The problem is, they aren't what most people see as adding real value because there is no economic return.

Xlar

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

This is definitely driven home on page 11 of the document:

"Over two-thirds of respondents with a household
income under $40,000 report that they would sell
something or borrow money to cover a $400 emergency
expense or could not cover the expense at all."

Bob W

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

I would be very happy paying that person a crap (pun intended) load more if that person where taking care of my parents.  I want to incentivize that person to care.

Of course, I would also pay social workers a lot more since they are dealing with real problems and real dangers.

The problem is, they aren't what most people see as adding real value because there is no economic return.
So I wonder if we went to a $15 minimum wage if things would change?

Hey It's Me

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

I would be very happy paying that person a crap (pun intended) load more if that person where taking care of my parents.  I want to incentivize that person to care.

Of course, I would also pay social workers a lot more since they are dealing with real problems and real dangers.

The problem is, they aren't what most people see as adding real value because there is no economic return.
So I wonder if we went to a $15 minimum wage if things would change?

I support a higher minimum wage, but I don't think that would help things at all in this respect. Think of it this way: these people don't all make the same wage now, but somehow necessary expenses have ballooned to fully equal (or exceed) their incomes. Without financial education, I would bet the same would be true at higher income levels, given enough time for hedonic adaption to kick in.

forummm

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

I would be very happy paying that person a crap (pun intended) load more if that person where taking care of my parents.  I want to incentivize that person to care.

Of course, I would also pay social workers a lot more since they are dealing with real problems and real dangers.

The problem is, they aren't what most people see as adding real value because there is no economic return.
So I wonder if we went to a $15 minimum wage if things would change?

I support a higher minimum wage, but I don't think that would help things at all in this respect. Think of it this way: these people don't all make the same wage now, but somehow necessary expenses have ballooned to fully equal (or exceed) their incomes. Without financial education, I would bet the same would be true at higher income levels, given enough time for hedonic adaption to kick in.

It's hard to say. There is research showing that when you are poor and always stressed about money, you make worse decisions in general. The idea is that your brain is already so taxed by the money woes that you don't have the willpower and cognitive reserves to deal with additional decisions as well.

In another study, they did a randomized control trial to give low-income people Medicaid in Oregon. Those people who got Medicaid (a benefit worth a few thousand dollars) had dramatic improvements in mental health, personal sense of well being, and dramatic reductions in financial problems in general.

In other countries, where people have a minimum income provided to everyone by the government, along with free healthcare and college, people seem to do quite well, and people rarely take the income from the government.

Hey It's Me

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

I would be very happy paying that person a crap (pun intended) load more if that person where taking care of my parents.  I want to incentivize that person to care.

Of course, I would also pay social workers a lot more since they are dealing with real problems and real dangers.

The problem is, they aren't what most people see as adding real value because there is no economic return.
So I wonder if we went to a $15 minimum wage if things would change?

I support a higher minimum wage, but I don't think that would help things at all in this respect. Think of it this way: these people don't all make the same wage now, but somehow necessary expenses have ballooned to fully equal (or exceed) their incomes. Without financial education, I would bet the same would be true at higher income levels, given enough time for hedonic adaption to kick in.

It's hard to say. There is research showing that when you are poor and always stressed about money, you make worse decisions in general. The idea is that your brain is already so taxed by the money woes that you don't have the willpower and cognitive reserves to deal with additional decisions as well.

In another study, they did a randomized control trial to give low-income people Medicaid in Oregon. Those people who got Medicaid (a benefit worth a few thousand dollars) had dramatic improvements in mental health, personal sense of well being, and dramatic reductions in financial problems in general.

In other countries, where people have a minimum income provided to everyone by the government, along with free healthcare and college, people seem to do quite well, and people rarely take the income from the government.

I agree. I don't think it's as simple as an either-or. That said, I did notice the same thing happen to my parents: their incomes rose quite a bit since my mom started working, but they're roughly in the same financial position, with the same financial woes. For them, that financial state has become the norm.

forummm

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It's hard to say. There is research showing that when you are poor and always stressed about money, you make worse decisions in general. The idea is that your brain is already so taxed by the money woes that you don't have the willpower and cognitive reserves to deal with additional decisions as well.

Coincidentally ran across this:

http://www.marketplace.org/topics/your-money/money-secrets/how-poverty-changes-way-we-make-decisions

forummm

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I hope everyone reading this realizes that a good percentage (50%?) of US households have very meager incomes in low paying jobs or have no jobs at all.   It is a 3 tier system here --  There are the rich ---  people who have decent jobs  --- everyone else.    It's amazing that people can't figure out that someone with a high school certificate, limited job skills/options and a below average I.Q.,  who came from a similar family situation is poor.   

That is the way our system works.   Perhaps if we wanted to adopt a more European approach it would be different, but it appears we are o.k. with the way we distribute wealth in this country. 

After all,  why would you want to pay someone who wipes butts at the nursing home more than $8 an hour without benefits?   That just wouldn't make sense.   

I would be very happy paying that person a crap (pun intended) load more if that person where taking care of my parents.  I want to incentivize that person to care.

Of course, I would also pay social workers a lot more since they are dealing with real problems and real dangers.

The problem is, they aren't what most people see as adding real value because there is no economic return.
So I wonder if we went to a $15 minimum wage if things would change?

I support a higher minimum wage, but I don't think that would help things at all in this respect. Think of it this way: these people don't all make the same wage now, but somehow necessary expenses have ballooned to fully equal (or exceed) their incomes. Without financial education, I would bet the same would be true at higher income levels, given enough time for hedonic adaption to kick in.

It's hard to say. There is research showing that when you are poor and always stressed about money, you make worse decisions in general. The idea is that your brain is already so taxed by the money woes that you don't have the willpower and cognitive reserves to deal with additional decisions as well.

In another study, they did a randomized control trial to give low-income people Medicaid in Oregon. Those people who got Medicaid (a benefit worth a few thousand dollars) had dramatic improvements in mental health, personal sense of well being, and dramatic reductions in financial problems in general.

In other countries, where people have a minimum income provided to everyone by the government, along with free healthcare and college, people seem to do quite well, and people rarely take the income from the government.

I agree. I don't think it's as simple as an either-or. That said, I did notice the same thing happen to my parents: their incomes rose quite a bit since my mom started working, but they're roughly in the same financial position, with the same financial woes. For them, that financial state has become the norm.

There is a big problem with people in general in our society that look at their income and think "OK, that's what I'm going to spend this year". That's fervently reinforced by businesses trying to sell them stuff and by others in the society. My in-laws say we should get a more expensive house "because [we] can afford it". And cable "because [we] can afford it".

But I think there is a substantive difference between those who are very low income and those who are middle class. When you are scraping by at a low income, and you adjust your spending upwards due to an increased income, that can have a pretty huge effect in quality of life. Maybe you're eating better or have a car or something else that's meaningful. Even if it's getting cable, that can be very meaningful, even if it's just giving the kids something to do (and not being on the streets) while you're at work. If you're already at a higher income, blowing extra cash on something doesn't really have as much effect on your life. If you eat at restaurants 4 times a week instead of 2, that's nice, but not transformative. If you have more expensive vacations (going to Europe instead of a domestic beach), probably the same thing.