Types of Poverty

Prosperity Club focuses on class differences to distinguish between incomes. Don’t assume that those with the most education or most money are better at handling money.

Prosperity Club’s blogs will help you learn where you need to start to the best of your ability. You will read about some ideas of how to prosper without depending on others.

Types of Poverty: How Different Types of Poverty Really ARE Different

Absolute Poverty

When people lack the necessities of life like water, food, clothing, and shelter. Having no resources is called absolute poverty.

Developing nations are not the only countries suffering from poverty, it can also be found happens in the United States and other wealthy countries like Europe.

Many people have false notions about those that live in the streets. They do not receive government assistance, they are homeless. They are living on whatever handouts they can get through begging.

They do not have bank accounts, credit cards, or cars and walk to most places that they need to get to.

Sometimes people in the streets have mental illnesses and because of the mental illness, or because of cognitive impairment, they might not be able to have or keep a job.

Prosperity Club does not deal with absolute poverty, but we do provide resources to help those in absolute poverty. If we as a country can resolve the issue of absolute poverty, then crime decreases, and communities become safer places to live.

Relative Poverty

Different Types of Poverty

Relative poverty is not having enough income for the necessities of life.

Those in relative poverty do not have a spending problem, they have an income problem.

These people qualify for government programs while employed.

Food stamps in most states will pay for food only. It will not pay for other necessities like toothbrushes, toothpaste, or shampoo, but this also depends on the state they live in.

When there is a sale on an item for buying a two pack or multipack, chances are they do not have enough money to take advantage of that deal.

Although some of these welfare recipients have lived on welfare for at least two or three generations. They are not the majority.

Some of these recipients also lack skills, education, or cognitive ability to obtain a decent job with a decent wage to survive.

It is not realistic to think that they can just pick themselves up by the bootstraps and work their way up by getting more training or education.

Many do not have bank accounts. They can’t meet the minimum requirement to have an account, they can’t afford to buy checks, or the other fees associated with them, like a bounced check.

Those in relative poverty are usually at the mercy of payday loans which charge huge fees to cash checks.

They can’t qualify for credit cards or loans based on their income and lack of credit history.

They are usually dependent on public transportation.

They usually do not have cars. They can’t afford a car or insurance. If they have a car, they had to pay cash for an older unreliable vehicle.

Nobody wants to live on welfare. When was the last time you heard someone say I would rather be poor than rich? If that were the case, the poor wouldn’t be buying lottery tickets.

For more information about absolute poverty and relative poverty Habitat for Humanity has a good link:


Situational Poverty

Recession Ahead

Usually happens during a crisis, like the Great Depression in the 1930s, or the Great Recession of 2008.

It can also be from a personal crisis, like medical/health issue, or a divorce. COVID-19 pandemic has put some people in situational poverty.

Once the initial crisis is over, like a recession, depression, or pandemic you can move on.

Those in situational poverty may not qualify for welfare assistance because of assets like a retirement account or even owning a car.

The Struggle Between Welfare and Transitioning to Middle Class

There is less money leftover when you are now paying for food and health care with your own money.

Selling assets or dipping into retirement accounts has been a common practice for those that have found themselves in situational poverty.

If you are under 59½ and dipping into your retirement account, it can cost you in penalties and savings being lost. This should be the very last resort when there is absolutely no other alternative available.

Several years ago, I read a story about a couple who fell upon hard times. The wife wanted to financially contribute by teaching piano from home, so her husband decided to sell some Disney stock to buy her a piano.

Over the years Disney stock had increased exponentially. The sale of that stock ended up costing him about a million dollars. That was the most expensive piano he ever bought.

Personal Welfare Experience

From personal experience I can say that there is a mistaken belief that people on welfare live like royalty.

You are given crumbs at best.

My mom was a welfare recipient but had the ability to learn new skills and get a higher paying job.

She became a draftsman working for Raytheon.

During the 1950’s and 60’s it was not common to see a female draftsman. In fact, she was the only woman draftsman in her office at the time.

A good blog about situational poverty can be found on:


defining situational poverty

Prosperity Strategies for Poverty

Prosperity Strategies for Poverty

For those with ability, continue to educate yourself beyond school.

Those that are willing to learn new skills or change where they work for better opportunities are the ones most likely to prosper.

Wherever there is a labor shortage, earnings increase for that position. Negotiating for higher pay is on the side of the employee.

If you do not qualify for government assistance, there are many nonprofit organizations, churches, and programs unrelated to the government that you can receive help from.

Every state is different, and some offer more help than others. In Massachusetts they have a green book that lists almost every program that you can utilize. In Utah, the Mormon church can lead you in the right direction.

How to Afford the High Cost of Childcare when You Can’t get Government Assistance

When I lived in Utah, a polygamist friend of mine had a daughter that got kicked out of their community and became homeless. Her dad asked if I could help.

She was under 18, so she couldn’t qualify for government assistance. She was no longer in school, so I told her she could live with me for free in exchange for homemaking and childcare.

Another strategy if you have children is to share childcare by taking turns with other parents that also need childcare and have different work schedules. For safety reasons connect with those that you know and can trust when sharing that care.