Do poor people really pay extra for different things?Let’s start with the things that poor people are gouged for on a regular basis:
Banks, Fees, Payday Loans, Collections And Court Costs, Oh My
So the bank works like this- You write a check for $20 and they cash the check based on your balance. Now if you write a check with an insufficient balance they charge you $32.00. Some banks give you a week to pay it and if not you get charged another $32. Now a $20 check becomes an $64.00 debt. Then, if your account is shut down, now you have to go pay court costs, collection charges which brings your $20 shortage of funds to hundreds in bloated fees.
While you are waiting for your next paycheck you have an unexpected emergency and need a payday loan. This of course isn’t free so now they charge you for that. Payday loans are known to carry exorbitant fees in excess of 300%. And that’s being kind.
Along with being poor usually comes bad credit or OK credit with not enough money to fix it. Invariably, that often means higher rates on credit cards, mortgages, insurance rates to requiring deposits on a rental car.
Think about it, if you’re poor that means you either have no job or a menial job in which you have little control around your schedule, pay rate/grade and duties/responsibilities. You are often at the beck and call of a disconnected scheduler who may give you a schedule that may interfere with other obligations such as picking up your child from the daycare on time which then costs you upwards of $5 per minute, per child if you’re late. If you have no job then you are stressed about how you will pay the rent, mortgage, utilities and put food on the tale. Stress leads to other things like a decline in your overall health and well being.
Furthermore, one of the more obvious ways that people pay more for being poor is through their health, often not being able to afford proper health care and even dying of treatable diseases mentioned above. When you’re up all night stressing about a possible eviction, you aren’t exactly thinking about going for your yearly checkup which could give you more insight and connect your recent bouts with shortness of breath and high cholesterol with financial stress.
If you’re poor then you probably have bad credit. Banks and other lending institutions like bad credit because they get to charge you more for the privilege of borrowing their money. Don’t believe me?
Being poor will force someone to make needed changes in in their attitudes towards money. For some this can be a motivator which inspires them to go back to school, seek a part time job, ask for a raise and overhaul their spending habits altogether. So if you happen to be in a bad predicament where your finances are concerned, there’s help available. But it starts with you and your attitude towards money.
Do you control it or does it control you? Being poor is expensive, can you afford it?
What do you need to do in order to get back on track? Go back to school? Learn new skills? Start that new business that only exists on a paper napkin or your trusty notebook? Whatever it is, just do it. I promise you, it can’t be more expensive than the cyclical financial hell of being poor with no options.