Most people feel poor when they are living paycheck to paycheck and struggling to make ends meet each month, but is this really poor? First, we will discuss understanding the different types of poverty and what being poor is. Once you understand what poverty is you can then continue reading about the steps needed to prosper. Depending on where you are, the socio-economic scale determines where you should be focused on making changes. The actions needed to prosper for the poor than they are for middle class.
Prosperity Club focuses on income to determine social class. However, income isn't the only deciding factor. Having more money or more education doesn't mean you are better at handling money. There are plenty of people with money that live pay check to pay check. They can be burdened by debts.
Our blogs include ideas and resources to help you on your journey to prosperity.
HOW DIFFERENT TYPES OF POVERTY REALLY ARE DIFFERENT
ABSOLUTE POVERTY
If you lack the necessities of life like water, food, clothing, and shelter, you are living in absolute poverty.
However, poor countries are not the only ones living poverty. Wealthy countries like the United States and Europe also have poverty.
Many people have false beliefs about those that live in the streets. Homeless people do not receive government assistance. You are living on whatever handouts you can get through begging.
If you are living on the streets, you do not have a bank account, credit cards, or a car. You are probably walking to most places that you need to get to.
Some people in the streets have mental illnesses, or lack the mental or physical capabilities of having or keeping a job.
Prosperity Club does not deal with absolute poverty. However, we do have a resource page where you can get help.
RELATIVE POVERTY
The difference between absolute poverty is the lack of necessities of life, while Relative poverty is not having enough money for the necessities of life.
If you are in relative poverty, you do not have a spending problem, you have an income problem.
Those in relative poverty qualify for government programs while employed.
Welfare recipients who have lived on welfare for two or three generations are not the majority.
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.
If you are poor, shopping can be expensive, you might have to sacrifce the Multipack or two pack deal because you only have enough money for one.
Many of these welfare recipients lack the needed skills, and education needed to obtain a job with a decent wage to survive.
Picking yourself up by the bootstraps and working your way up is not easy if you have physical or cognitive disabilities.
Many banks have a minimum dollar amount in order to have a checking account. If you have less than the minimum, you will pay fees. Those in relative poverty can't afford to buy checks, or the other fees associated with them, like a bounced check.
Fortunately, today we now have mobile apps that have helped like Cash App, Chime or Venmo. Phones are considered a necessity most of those in relative poverty have a cell phone. Some states have programs that provide cellphones to those in need.
If you are in relative poverty, you are probably using payday loans which charge huge fees to cash checks.
A lack of credit history and livable income will prevent you from qualifying for credit cards or loans.
You will be dependent on public transportation and probably won't own a car. Car insurance is not affordable for most. If you do own a car, it is probably old and unreliable.
Habitat for Humanity has a good link on absolute and relative poverty
SITUATIONAL POVERTY
Situational poverty happens during a crisis. Some examples would be 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 owning a car.
THE STRUGGLE BETWEEN WELFARE AND TRANSITIONING TO MIDDLE CLASS
I had to become resourceful in finding ways to pay for my needs like food, clothing and shelter. There wasn't enough money to pay for health care, or dental.
Most people resolve money problems by selling assets or dipping into retirement accounts.
If you are under 59½ and dipping into your retirement account, it can cost you in penalties and a loss of savings. This should be used as a last resort.
Several years ago, I read a story about a couple who were financially struggling. To help financially, the wife offered to teach piano from home. The husband decided to sell some Disney stock to buy her a piano. That was the most expensive purchase he ever made. If the husband had kept the stock, it would have been worth over a million.
You can go to Richmond vale website if you want to know more about situational poverty
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.
Welfare recipients receive canned goods, highly processed foods and other unhealthy options.
My mom was a welfare recipient and I remember how hard it was. However, my mom had the ability to learn new skills and get a higher paying job. She became a draftsman working for Raytheon leaving the welfare system.
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.
PROSPERITY STRATEGIES FOR POVERTY
In conclusion, assuming that you have the cognitive abilites, and have a better understanding of poverty, what can you do? In short, continue to educate yourself beyond school. Learning new skills or changing employers will give you better opportunities.
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 where you can get help. For a list of resources go to my resource page.
Some states offer more help than others. Massachusetts has a "green book" that lists resources in the state. Utah, has the Mormon church that offers help.
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. She became homeless and her dad asked if I could help.
His daughter couldn’t qualify for government help because she was under 18. She was no longer in school, so I asked if she would like to live with me in exchange for homemaking and childcare. I lacked the money to pay for childcare and she needed food and shelter.
Another strategy if you have children is sharing childcare with other parents that need childcare. For safety reasons connect with those that you know and can trust when sharing that care.