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Monday, April 18, 2016

So What Does Poor Mean Anyhow?

Photo credit- David Castillo Dominici
Last week I wrote a post discussing whether or not eggs are really as cheap as they are made out to be, and in the comments section there was a little back and forth about being "poor" and if that is something worthy of criticism.

Completely unrelated to that, the other day I went with my kids to the city, and my oldest, Lee, who has been saving up his money, decided completely on his own to bring along some of his loose change to be able to give it as charity to the beggars he'd inevitably see on the street. While in the city, we started talking about charity, needy people, etc, and then he asked me "Mommy, are we poor?"
I mean, as someone who is famous for living frugally and goes by the name "Penniless" I guess such a question from my kids was inevitable at some point.

My answer to my son started with "Poor is relative; compared to some people we're poor, and compared to other people we're rich."

But the thing is- it got me thinking- what does poor mean anyhow, and are we poor?

The dictionary definition: "having little or no money, goods, or other means of support/dependent upon charity or public support" doesn't help much, because, again, that is relative. Who defines little money?

The more I thought about it, the more I considered how there are a few different financial situations that people can be in that would defy the stereotypes of what poor really is.

Lets talk about Joe and Mia, who bring in only $2000 per month for their family of three. Things are very tight financially, but the wife is a stay at home mom who makes everything from scratch, gardens, and forages, and they buy all their things second hand. Joe is a hunter and a fisher in addition to his regular job, so that's "free" meat as well, which makes a big dent in their grocery budget. They buy legumes and grains in bulk, grow or forage most of their own vegetables, and in general, live a very "earthy", from scratch, "back to nature" life. Therefore, despite not bringing in much money every month, Joe and Mia manage to not only make it through the month without needing food stamps or other governmental assistance, they also manage to put away money every month and they've built up a small savings, and aren't living paycheck to paycheck.
Joe and Mia live in a community with other folk like them, and despite having very little income, they don't feel lack; they see all the abundance around them and are happy with their life.

Then you've got Sam and Mary, who make $6000 a month, three times what Joe and Mia make. Sam and Mary are both working full time jobs that don't pay well, but together they have some money. But Sam and Mary bought a house that eats up a lot of their monthly salary in mortgage payments, and because they are both very busy working, they don't have much time to make things from scratch, nor do they have much desire to do so, so they tend to rely on convenience foods, eating out, etc. From previous bad financial decisions, they ran up a lot of credit card debt and each month have staggering credit card bills. On top of that, they live in a community of more well to do people, with families that are constantly renovating their homes, buying new cars, going on vacations, etc. Though they try not to "keep up with the Joneses" too much, they do go on the occasional vacation, buy things new instead of second hand, and tend to stick to more name brand items, since they don't want to be looked at as the "paupers" of the community- they want to fit in, and they also don't want to feel that they never get the nice things everyone else has.
Mary confesses to her best friend that they are not making it through the month, that each month they go more and more into debt, and they try cutting back on expenses but they don't know where they can.

And then you have Nathan the billionaire who made a billion, bought a private jet, but then ran out of money to pay for it and declared bankrupcy...

Which of these people actually are poor?

If you just look at income amounts, you'd say that Joe and Mia obviously are poor. But if they're not struggling financially because they make smart money decisions and live within their means enough to save up a nest egg, are they really poor? If they have everything they need, and more, are they poor?

What about Sam and Mary? They make three times as much money as Joe and Mia do, but they can't make it through the month because their expenses are so high, and they are constantly feeling what they don't have. Are they poor?

Who is poorer? Sam and Mary who make more but have less left over? Or Joe and Mia who make less, even if they have more left over at the end of the month? Or would you consider Nathan the billionaire poor, since he had to declare bankruptcy?

If you had charity to give, who would you give it to? Who would you say needs it most? Who would you say deserves it most?


Lets say Joe meets Sam one day and they start talking. Do you think it makes sense for Sam to tell Joe that he's envious of him, that he wishes that he was able to save up money like Joe does, that he's under such financial stress, and could Joe help him out financially? I mean, in actuality, Joe does have more cash available than Sam does when everything is said and done.
Would you understand Joe if, instead of empathizing with Sam's plight, internally he thinks badly of Sam for making, what Joe considers, stupid financial decisions that cause him to be in a bad financial situation? And for asking Joe for help when he doesn't do even a fraction of the things that Joe does to save money, and lives a life that is much more luxurious than Joe ever would dream of living? (I'm not saying Joe would be correct/fair for thinking that, because everyone has their own circumstances and limitations, only that it would be understandable for him to feel that way.)

So, I didn't answer this to Lee directly when he answered, because I had a lot to think about then, but I did explain to him that there are many aspects of what would make someone poor or not. And that its not just about how much money you have coming in, but on how you spend the money that comes in, and how much is left over.

A big aspect of whether someone is poor or not would be, in my opinion, if they are feeling lacks, and because of that, it really would depend on societal expectations. Compared to someone living in Silicon valley, my family would probably be considered very poor, but compared to a family living in a village in Africa, my family would be very rich indeed. We have a fridge! Freezer! Washing machine! 1 laptop, 3 smartphones, and 3 tablets! And that's not counting our electricity, internet, large amounts of clothes and large amounts of food in the house.

Personally, if I had to define poor, I'd consider it someone without enough money to cover their needs, and therefore had to do without. Anyone who's ever gone to bed hungry or skipped a meal because they don't have enough money for food would be poor in my book.  Anyone who ever was homeless/had to move in with their parents/a family member due to lack of funds. Anyone who ever went without properly fitting/decent clothing/undergarments because they couldn't afford to buy ones that fit/weren't stained/ripped. Anyone who ever had their bank account closed or severely limited because of bouncing checks too many times. Anyone who neglected to treat medical issues because they couldn't afford the treatment. Anyone who got their utilities cut off because they couldn't pay their electric/water/gas/phone bill. Etc.

I wrote recently how I was very intimidated by writing budgets, because there were months where our income did not cover all our expenses, but in the last few years we never actually were in a bad enough position that I would consider ourselves poor. In fact, ever since we moved to this place, downsizing and spending hundreds less on rent each month, we haven't ever been in a bad enough situation that we went without necessities.

The worst situation we ever were in was about 9 years ago when I had only about $15 to last for a week's worth of groceries, and I ended up just buying dried white beans, cucumbers, onions, and flour, and just made baked beans over homemade rolls to eat, with cucumbers on the side, because that's all we could afford. But even then, despite being in a desperate situation, we didn't go hungry, and if anything happened now to us, we wouldn't go hungry, thanks to our stockpile...

So no, I don't consider ourselves poor. Would I like more money? Certainly. Am I working hard to try to improve our financial situation? Absolutely. Would I like to be bringing in more money each month and not need to be so frugal? Without a doubt.
But in my mind, poor means in such a bad situation that you go without basic necessities. And fortunately, though money has been tight for us many times, I've never had to go without, and in many years haven't been in a bad enough situation where I needed to ask for charity or for someone to bail me out.
And I feel grateful for that.
For that reason, if you would ask me- is my family poor? I would say no. Because I feel blessed, and I am very appreciative that we haven't been in such a bad financial situation, especially when so many people dear to me have been in such situations.
I might say that we're broke. In fact, that is the term I tend to use most when money is especially tight.
But poor?
I prefer the word "low income" because poor is so subjective anyhow, and I don't feel poor.

So, what does poor mean anyhow?
I think that if you feel that you are, then maybe you are. But maybe you can be in the exact same situation and not feel poor.
Who knows?

What do you think? What does poor mean anyhow? How do you define it, in tangible terms? Would you consider Joe, Sam, or Nathan poor? Why or why not?



18 comments:

  1. Sam and Mary, and the foolish billionaire are not poor. They are broke. Joe and Mia are poor, but they are not broke. I have been poor and I have been broke (due to house renovations with unforeseen major extra expenses). I prefer poor.

    My family lives in a relatively poor area (for the country and city we live in). My younger kids go to a neighbourhood school. To many of the other kids at their school, we are "rich" because we own a (very used) vehicle, own the duplex we live in, and my 12yo doesn't use her babysitting money to search local thrift shops for her spring jacket (actually, she got a hand me down from her older sister, but this was a recent example of her friend saying to her that she thought we were rich). We also have a small yard, but it is a decent size for the neighbourhood. Our income is no higher than the average for the area, but because of how we live and the choices we've made over the past 15 years, we appear better off to some people. Things like always shopping sales for food, never going into the corner store to waste money on lottery tickets and overpriced junk food, and other frugal things we have done over the years makes us seem and feel better off than average for the neighbourhood.

    My older kids go to a high school with kids from a huge catchment area. The average family income of kids at that school is easily 2x our family income. I don't think my older two kids feel deprived compared to their classmates, but when they visit friends' homes, or get a lift with their parents, or hear other kids talking about new clothes or vacation plans, etc., they are aware that we have less money to throw around than their classmates parents do.

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    1. So in your opinion, poor is about how much money comes in, and broke is about how much is left?

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  2. What's your education level? It has everything to do with your socioeconomic status. Are you low income because you are making choices that value experiences over money, or are you low income because you have no hope of ever being anything else because you don't have the education or the functioning to get out?

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    1. Lets say Joe and Mia, both high school level education, no higher, but aren't miserable or suffering and aren't spending a lot either and have enough to save- are they poor, even if they never will be making more money than they currently are?

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  3. Thought-provoking article. Thanks for sharing! So much comes down to wise and foolish decisions and choices. And i am guilty of plenty of foolish ones!

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    1. Trust me, I'm also guilty of foolish decisions, though I try not to make them too often.

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  4. I've heard it said that "poor" is a mindset (a victim mentality... poor me, I'll never get ahead), and "broke" is a situation that you'd like to get out of.

    I think poor is a mindset more than an income or spending level. When I was a little kid, I heard my parents say, "We can't afford that" or "some people make a LOT more money than we do". And sometimes I felt poor! My husband, on the other hand, grew up hearing "we don't need that" instead of "we can't afford that". He didn't feel poor, even though his parents were FAR more frugal than mine.

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    1. I hear about the "victim mentality" aspect vs broke being fixable. You make me wonder if what I'm saying to my kids "We'd rather spend our money on other things, not that" is more like what your parents said or like my parents.

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    2. Yes! Also, if your kids have enough to eat, as you said, you are giving them a gift and not a curse by being frugal/low-income. Growing up, we hardly EVER ate out. When I started dating my husband, it was such a treat to eat at restaurants so often! What a gift my parents gave me, whether they could afford it not, by choosing not to eat at restaurants.

      Keep that in mind: by setting the lifestyle bar low, you are setting your kids up for contentment and thankfulness in the future.

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  5. My family always said that you are only poor if you think of yourself as poor. We describe ourselves as having limited cash flow at the moment!

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  6. I love your definition, Penny

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  7. I had a friend tell my husband that we live like we are poor - when we are not.We are definitely not rich.. I make a fair wage as a nurse and live in a 940 sq. townhome that needs some work. I prefer to buy most things second hand so I think that is why he thinks that way... I don't want to spend all my money on stuff. Growing up we had our electricity and water shut off more than once so I think being poor is not having money for necessities. But I am sure we were much better off than others.. we always had a home and food to eat.

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  8. to me being poor means not being able to support oneself and one's family despite best efforts in work and economy, not having a social or governmental safety net, helplessness in the face of adversity, poor is not having enough food, having teeth fall out because dental care is out of reach, feeling hopeless and tainted, having people look at you with a mix of pity, fear, disgust

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  9. I would say "poor" is like you said not being able to meet basic needs. I don't think poor means not managing money wisely. One interesting thing I noticed recently is that in years past when we had little to no income and needed to skrimp to make our savings last, and I was happy! Now we have had a windfall year and I am no happier. We have always had our basic needs met and had a safety net so I guess we have never been in a difficult situation that would cause us misery. But, I really don't feel happier now that I don't need to bargain shop and find ways to save every penny.

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  10. My guy has a friend who makes so much money as a tech person but he says his rent eats up most of his money (and that is with a roommate!). So I agree that just because you have a high salary, everything is easy coasting.

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  11. I would say I probably grew up poor but never felt poor at all. I was surrounded by extended family that showed how much they loved me daily. Having unconditional love is priceless! No amount of money can buy that. When my dad was out of work for the summer due to lay-offs he found other work that took us away from home. We camped at a lake with family that entire summer. The kids and moms stayed at the lake and had fun all day while the dads went to work. We all shared our food with each other. Fish would often be on the menu as well as hotdogs. My dad was taking care of his family to the very best of his ability. It was a drastic step in today's view but I remember as the best summer of my childhood. Basically, life is what you make of it no matter how much money you earn. I wish more people could understand that most simple concept.

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  12. Those guys are BROKE and bad decision makers, until they put their hand out...then your poor.

    I'm lower middle class, my car is 16 years old but has been paid off for the last 14. My house is a basic 1500 sq ft ranch, 3 bed, 2 bath but I have more in equity than is owed on the loan since the value has doubled since I purchased it. I never go hungry and I'm doing a pantry challenge now cos I have too much.

    I'm even purging excess items from my home to give to charity.

    I need a new tv and car. That's about it. Don't care for brand name clothing since the brands aren't paying me to wear and advertise, but will get some from the thrift store if it's the right garment I need in my life.

    However, due to bad money decisions I'm usually broke. I hope to change this. Matter of fact, I have $17 bucks until payday. I lack for nothing but then I don't have any savings either should something horrible go wrong in my life that insurance doesn't cover. I don't even own a credit card, nor suffer debt issues.

    Now..poor? My sister is poor based on the dictionary's definition. She hasn't worked in 20 years and lives off the disability checks her now adult children get and that her boyfriend brings to the household. She is always going to the food pantry for freebies. Clothes closet for free clothing. The last 10 cars she had were given to her (and yes, she wrecked each and everyone of them.) She has no desire to improve her station in life. She is not a fat lazy slob by any means, she just doesn't want to work and at this point in life, can't due to bad knees and lack of knowledge of computer programs so she could get a sit down job. She always has her hand out. She's waiting for 62 to roll around in a few years so she can finally collect SS (won't be much I imagine.)

    Two people raised in the same home with the same ideals and work ethics. How or when she decided she would rather be poor than stable, I don't know. But it is a choice as far as I'm concerned.

    Yesterday my husband told me about a co-worker who lives in a horrible roach infested trailer with a wife who refuses to work. They are poor at first glance until you hear how the wife has land but refuses to do anything with it because of WHO gave her the land. So...there ya go, another choice to live poorly when you have the means to live comfortably.

    Another example: one of my step-daughters expects her Dad to send her $60 a week in child support in addition to what he pays the court. Bad decision/promise on my husbands part but come August he will no longer be paying as she will finally be 21 (NY state law). She's already complaining about how the loss of funds will effect her life if he stops. It's $240 a month, I make almost that much in a day at my job (before taxes). My husband told her to go after child support for our granddaughter but she doesn't want to make her ex-boyfriend mad incase he comes back to her even tho she said she's done with that relationship. Choices. Stupid, stupid choices. Perhaps a lack of funds will force her to get a job and grow up. I wonder if they pay people yet to stare at their phones all day liking Facebook posts? If so, she'd be a millionaire.

    In the end, it's all a choice. I'm sure some will argue about PTSD with Veterans, mental health folks, etc. Yes, this poor choice doesn't apply to every situation, but for MANY people out there, it is. After all, feed a man a fish, he eats for a day, teach a man to fish and he better bring home some dinner cos he knows how to fish. LOL.

    Thanks for another great mind thinker. Loving it. - Mattie

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