S/o poor vs middle class

amother

Viola

Mon, Jan 16 2023, 9:33 am

Some people are saying that having credit card debt is necessary to fund their basic needs like food.

If you well and truly cannot afford to fund your most basic needs but must use credit, do you have a plan for changing the situation? For example, there might be temporary circumstances like being a student or having just purchased a home that are going to change within a year or so and you will have sufficient income.

And I do understand that sometimes a credit card is needed for a true emergency but then it can be paid off within an appropriate time period because it is an unusual expense rather than having insufficient monthly income to cover your basic expenses.

Also the cost of carrying credit card debt drives up the cost of everything you buy. Keep in mind that if you have any amount of debt on your credit card you are charged interest as soon as you charge an item. If you have no outstanding balance you pay no interest on monthly purchases.

Here is a chart illustrating how much more it costs over just a few years

Trademark

Mon, Jan 16 2023, 9:38 am

amother Viola wrote:

It costs more to be poor.

Check out the boots theory.

https://moneywise.com/managing.....rness

amother

Viola

Mon, Jan 16 2023, 11:11 am

amother Yolk wrote:

Everyone knows it's not good to have credit card debt. However, your chances of getting out of poverty are a lot higher if you buy food than if you don't.

These discussions go around and around because there is a disconnect between what a person *needs*

I don’t think starvation is the issue in the USA because between charity and food stamps people should be able to have food. Not a fancy diet but reasonably nutritious if someone is careful.

If one is living within one’s means and has a true emergency then one would be able to pay back the charge within a reasonable period of time.

The issue is what discretionary expenses people put on their cards because they feel they deserve this however they justify spending that they can’t afford.

And how one can sustain an existence where one doesn’t have enough money to cover non discretionary expenses without some kind of plan to either raise income or reduce expenses

I mean what is the end game if one is just increasing credit card expenses every month 🤷‍♀️🤷‍♀️

amother

Saddlebrown

Mon, Jan 16 2023, 11:19 am

amother Dodgerblue wrote:

l recently had this thought that the standards in our community would be very different without cc. So much materialism and keeping up with everyone would not be possible. More hard work would be appreciated. For those saying it buys food. It’s rright but are you just buying basics or loading up on nosh and steaks and tablesettiing. In Africa they have no money no food and no credit but they might still be richer than some of us.

The poor people that I know with credit card debt, their debt is mostly medical expenses, things like fixing the heat, the boiler, patching the roof.

Take my cousin who both spouses work ft. They are living paycheck to paycheck but they're surviving.
And then they deal with an emergency appendectomy, anaesthesia, and hospital stay, plus 1 spouse is out of work for 3 weeks.
They only have basic insurance so their deductible is sky-high. They have to pay $8000 in full for the medical expenses.
They make a payment plan but really don't have the ability to pay so it goes on the credit card.
They don't live extravagantly. No steaks and tablescapes. Only 1 car for driving carpool. No vacations. Reduced tuition.
But they're living paycheck to paycheck.
What would you suggest?

A business magazine that I read stated that 80% of all cc debt in America is medical.

ora_43

Tue, Jan 17 2023, 2:23 am

amother OP wrote:

After reading the thread of poor vs middle class, and what ppl find a necessity I had this thought. How much of the things we consider necessities are real. What if we had no CC would we still view cleaning help a necessity, buying trendy clothes...if we actually had to pay up all our monthly bills?

I mean... you do have to pay your monthly CC bills?

If credit cards were "endless free money cards," then yeah, our list of "necessities" would probably grow to include things like a separate bedroom for each child, an in-ground swimming pool, private tutoring... But most people do treat credit cards as something that needs to be paid off, and thus, only use them for things they can afford to buy.

And in general, when people are irresponsible with money, they'll find a way to be irresponsible with money even if it comes as cash.

I do agree that there are probably some people who'd be better off if they switched from credit cards to cash, but I don't think that's a significant factor for most people. In general, what we consider 'necessities' has more to do with what the people around us are doing, what things cost, societal values, etc.

Quote:

... yes a lot of knowledge that therapist offer is out there for a very affordable price.

Nearly all of the knowledge that most professionals offer is out there for a very affordable price. Rabbis, doctors, political scientists, programmers... It's just that:
1. learning by yourself has serious limitations (someone who doesn't know anything about a new field might not know what it is they need to learn, or which sources are reliable, or whether they truly understand the material as well as they think they do)
2. nobody has the time to learn all that material; we can't be rabbi-doctor-lawyer-therapist-plumber-chefs, so we have to pick and choose what we outsource to others.

Plus, as others said, the 'other person to bounce things off of' is often a big part of what people need from therapy.

amother

Lemonlime

Tue, Jan 17 2023, 4:46 am

amother Viola wrote:

I don't know. See the other thread where she doesn't qualify for foodstamps and her kids are hungry. She's far from the only one.
What would you advise?

seeker

Tue, Jan 17 2023, 6:20 am

I can't follow another endless thread on this topic but I'll just respond to the part of OP indicating that it could be melodramatic to say it's either cleaning help or therapy, and maybe read a book for therapy instead. OK I know that's not exactly what she said, I'm taking the liberty to exaggerate my interpretation to make the point. And I'm going to do it under my screen name because I don't think this is shameful or a fault.

Bh my life is pretty good now but there was a time when things were literally too much. I was, in fact, seeing a therapist for various issues at the time. Was not paying a fortune for this, I was able to get it subsidized by an organization. I'm a decent client. I try to learn coping strategies and do my best to apply them. But life was literally too much and I was actually losing it. At this point I had been given a serious mental health diagnosis that was difficult to accept. The therapist was trying to refer me to a full day treatment program. This sent me into a worse mental state because if I couldn't handle the demands of life in the first place, how would I do it all with fewer hours in the day (spending several in treatment) and less money (giving up billable hours to spend in treatment plus who says my job would even keep me on if I could only give them a fraction of the time). The impossibility of this is what pushed me to somehow amid the blur find a competent, highly regarded, private, expensive psychiatrist who specializes in the diagnosis I had been given (alongside general expertise.) He was very attentive and seemed to cover all bases in the initial evaluation/consult. He vehemently denied the previous diagnosis, which was based on symptoms rather than the full picture; said of course therapy isn't solving anything because the demands I was under were just not reasonable (I do still think it can help with feeling overwhelmed but within reason); and confirmed that more intensive treatment would make things worse rather than better.

Going to cut the story short here because only G-d knows how I got up from that place. He did prescribe me something to take the edge off the panic while I could start to figure things out. My point is that I think it is very possible that paying for additional childcare, household help, or conveniences may have averted my life turning into such a disaster. Are there people who say this as a cop-out? Probably. But that doesn't mean that it isn't also true. You need to be smart about drawing the line between your own wants and needs but on a general level yes frugality can have a cost and it can be true that it's worth investing in not going crazy.

As to the second point, about books being a good substitute for a MSW or PhD, while my story above could be seen as a cautionary tale against therapists who get it wrong, I've also had positive therapy experiences and there is a lot more to it than book learning. A lot of the work takes place in the relationship itself between client and therapist. And sometimes you need someone outside yourself to help figure out what's going on which you might not see from a book. And even if the book you read is the same book as the therapist read, for the therapist it's one out of dozens of books and courses so they're bringing a lot more context and background to/with the book. I'm a big fan of self help actually, but it's also wrong to say "you don't need to waste money on cleaning help OR therapy; when the household management gets too much you can use a $15 book to bring you back to sanity!"

/soapbox

Carry on