Too many people believe that being poor is easy. After all, the poor get profound government benefits, right?
It's not as easy for them as you may think.
Being poor is more expensive than being in the upper or middle classes in more ways than one.
If you're above the poverty line, this article is sure to show you that you don't have it so bad after all. There's much contentment to be found in a decent wage.
If you're under the poverty line, here's some more motivation to learn a new skill and put it to use in the workplace so you don't have to pay the "poor tax."
Why is being poor more expensive? Let's explore . . . .
The poor pay a higher percentage of their income to the local government.
Surprised? I was too when I learned this.
The New York Times explained results from a recent study regarding taxes:
According to the study, in 2015 the poorest fifth of Americans will pay on average 10.9 percent of their income in state and local taxes, the middle fifth will pay 9.4 percent and the top 1 percent will average 5.4 percent.
Also consider the burden that professional tax preparation places on the poor. If someone who is poor pays a professional to handle their taxes, they're certainly going to pay a higher percentage of their income than someone who is in the middle or upper class.
There have been proposals made by various groups to simplify the tax code, and specifically for the federal tax code there's the FAIRtax. From their website:
The FairTax is a national sales tax that treats every person equally and allows American businesses to thrive, while generating the same tax revenue as the current four-million-word-plus tax code. Under the FairTax, every person living in the United States pays a sales tax on purchases of new goods and services, excluding necessities due to the prebate. The FairTax rate after necessities is 23% compared to combining the 15% income tax bracket with the 7.65% of employee payroll taxes under the current system - both of which will be eliminated!
If local governments can focus on similar taxation strategies, the poor would thrive because they wouldn't be taxed on necessities.
The poor many times don't have the ability to buy in bulk.
Buying in bulk can often save families money in two ways.
First, many times products are packaged in bulk and sold at a discount to encourage more sales. Consumers can take advantage of this - as long as they have the cash to purchase in bulk.
Second, it's possible for consumers to spot a great deal on a product or service. Perhaps the deal only comes around once per year - a perfect opportunity to purchase in bulk. Again, consumers can take advantage of this - as long as they have enough in their bank account.
The poor many times are living paycheck to paycheck and don't have the ability to buy in bulk. Because of this, they instead have to purchase fewer items at the discounted price and pay more over time, or they have to buy smaller quantities of the items and therefore pay the higher price point for those items.
Not having the funds to buy in bulk can be expensive. The poor are often in this situation and are at a disadvantage.
The poor may buy cheaper, unhealthy food which may result in health problems down the road.
Foods in the center of grocery stores usually contain foods that are high in sugar, are processed, and contain very little protein and fiber. However, they're pretty cheap food options.
Organic produce and quality meats are usually expensive and much less tempting than their sugar-filled counterparts.
When you combine addicting food with cheap prices, what could be a more tempting option for the poor?
Obesity is an epidemic in our country, and these cheap foods are certainly to blame. And, that's just one health complication that can be very costly later in life.
The poor are certainly at a disadvantage when it comes to food choices - but nutritious, healthy food is a must-have.
Even if you count yourself among the poor, do your best to pinch your pennies and buy food that will fuel you throughout your day and keep you living longer, less expensive lives.
Final Thoughts
Being poor is expensive. It's easy to see why. But if you're poor, I'd like to offer you some encouragement.
Whether you're in debt, are having trouble with maintaining your budget, or don't have much money stored up in the bank. You don't have to be stuck in your current situation. There are so many creative ways to make more money.
Are you poor? What are a few more ways being poor can be expensive? Have you found a workaround? Leave a comment!