Why are low earners etc bad @ budgeting etc

[Cyclone]

Someone can be seen to be wealthy, when they are actually mired in debt - the Queen Mother had the title, the stately home and all the jewels and gin she'd ever need, and she died about £7million in debt... Wealth (especially extreme wealth) can be an illusion...

 

So in reality someone in this situation isn't rich at all. As you say, they have the appearance of wealth, but their actual financial situation is dire.

[PC Brigade]

So in reality someone in this situation isn't rich at all. As you say, they have the appearance of wealth, but their actual financial situation is dire.

 

The idea that being in debt means your financial situation is 'dire' is nonsense.

 

Take out a mortgage and you'll immediately be in debt - this doesn't mean you are in a dire situtation. Debt only becomes a problem when the cost of repayment becomes too much.

[Cyclone]

That isn't what I said, I referred to 'this situation', that being the situation outlined a posts earlier that was

 

and she died about £7million in debt

 

and in reference to people being rich.

If you don't want to call a net debt of £7 million dire then don't, but I don't think you can claim that I'm wrong to do so.

 

Someone who takes out a mortgage generally wouldn't be described as rich. Maybe my understanding of rich is different to other peoples, but I'd describe it as having a large amount of net wealth, I'd probably go further and specify that it was liquid wealth.

 

If you are have debt that exceeds the value of your assets you are not rich. If you don't have a large amount of liquid wealth then you aren't rich (I suppose large is subjective).

[watchcoll]

She doesn't have a phoneline, she has a prepay mobile phone which she hardly ever tops up. She doesn't have sky, She doesn't have internet. She can't afford that. She manages on the basics which is what I thought this thread was about. She has the bare minimum to live on but she makes it work and neither her or her daughter go without what they need. I take her shopping and she plans her meals day by day, Buying fresh veg and fruit so that her daughter is not eating processed foods. And so it just goes to show that not ALL people on benefits/low income don't know how to budget. Like I said. I find it fascinating that she can recite everything she has spent her money on. I couldn't do that.

 

sounds to me like your friend was raised well, with good discipline and a sense of pride and self worth that outstrips the worth of any monetary value she may or may not come to possess. if only there were more people like that.

[dink]

The idea that being in debt means your financial situation is 'dire' is nonsense.

 

Take out a mortgage and you'll immediately be in debt - this doesn't mean you are in a dire situtation. Debt only becomes a problem when the cost of repayment becomes too much.

 

Yep i agree with the mortgage.

 

Also if you pay your gas and electric bill, monthly or even quarterly you are in debt, as you have an outstanding bill.

 

So to all the people knocking the lady with pre-pay meter i think she is being sensible and trying to eleminate having to have anyothe bill, if she cant afford it she wont be able to use it, so she is therefore getting rid of a potential debt!

 

To round it up maybe low earners are struggling o budget properly because the cost of things have rose so much, the ''wealthy'' people in Sheffield are most probably people who have been on the housing ladder for 20/30 years who bought there first house cheap and sold it for a tidy penny.

 

id like to see anyone try and get on the ladder now, its hard due to the over inflated prices, which saw alot of people get rich quick!

[Cyclone]

You think the wealthy people in Sheffield are homeless? They bought a house cheap, sold it and what, now live in a caravan or a cardboard box?

 

The only people that 'got rich' from the house price boom were property investors and builders. Having a house worth 300k doesn't make you rich as you need a house to live in.

[cressida]

Wouldn't a a solution to this be to pay benefits in the form of vouchers, which can only be used to pay for essentials such as food, rent and gas/etc!

 

I really don't know why this hasn't been done, perhaps too advanced an idea for previous governments - or they'd be too scared of the comeback

[Cyclone]

There's no point, that's why it hasn't been done.

If someone wants cigarettes and they have food vouchers they'll get food and exchange it for cigarettes at a mark up. Or if the vouchers aren't identifiable they'll just exchange the vouchers.

[melthebell]

yet more generalisations without substance

[Keith Rich]

Although i have mentioned this on a seperate thread thought id start a seperate thread...

 

So why is is that people who are low earners,on benefits or live on depressed council estates find it hard to manage thier finances.

 

For example they spend a higher % of thier disposable income on non essential branded goods. (ie "nike" trainers). When a cheaper non branded alternative will do. Are parents that obsessed with how thier kids look?.

 

They also seem to be the sort of people to buy more processed food (has no one taught them to cook). If they learned to cook then they wouldnt spend so much money on poor food.

 

These people are the ones who then whinge that they owe lots of money to door step lenders.

 

Money management on a tight budget isnt that hard. It should be something people learn before they drop thier first chavie.

 

Common sense isn't that hard but many people don't have it, especially those who express opinions of which they have not the slightest evidence.