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Old 09-11-2014, 12:21 PM
 
Location: Tennessee
23,572 posts, read 17,544,804 times
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Let's say you are working for ten bucks an hour. At that wage, basic food, rent, transportation, etc, will consume most of your budget. There is little for saving, and not a lot of adjustment can be made by choosing to spend more on X and less on Y.

Would this person be too poor to have any discretion in their personal finances?
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Old 09-11-2014, 12:23 PM
 
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If there is no money left there is nothing to have discretion with so it is a moot point.
If this person had even $3.00 left after all monthly obligations were paid and put 1/2 of that in a savings account it would eventually grow.
Obviously it would take a long time but if left alone and not taken out of the account it would be there and it would be gaining a wee bit of interest.
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Old 09-11-2014, 12:26 PM
 
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Your best bet then it to get a second part time job. I have done that when younger and many do now.
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Old 09-11-2014, 12:27 PM
 
33,046 posts, read 22,043,990 times
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Quote:
Originally Posted by Emigrations View Post
Let's say you are working for ten bucks an hour. At that wage, basic food, rent, transportation, etc, will consume most of your budget. There is little for saving, and not a lot of adjustment can be made by choosing to spend more on X and less on Y.

Would this person be too poor to have any discretion in their personal finances?

If you're asking whether a person can be too poor to have discretionary income, the answer is yes.
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Old 09-11-2014, 12:29 PM
 
Location: The Triad (NC)
28,490 posts, read 62,120,010 times
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Quote:
Originally Posted by Emigrations View Post
Let's say you are working for ten bucks an hour.
multiplied by how many hours actually worked?
(we'll get back to this detail)

Quote:
At that wage rate, basic food, rent, transportation, etc, will likely consume most of your
budget. There is little for saving, and not a lot of adjustment can be made by choosing to spend
more on X and less on Y.
Good thing spending adjustments aren't the only choices available... right?

Quote:
Would this person be too poor to have any discretion in their personal finances?
That depends entirely on how much they earn at that $10/hr wage rate.
Which means how many hours per week they work.

5hrs per week & $50?? 30 hrs per week & $300??
What about 80 hrs per week & $800??
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Old 09-11-2014, 12:53 PM
 
Location: Florida -
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While one might not have much in the way of discretionary funds with a lower income, it is even more important for one with a lower income to exercise greater discretion in their spending.
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Old 09-11-2014, 01:01 PM
 
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The statement frequently made when referring to companies and the government is also true about individual finances. You can't cut your way to riches.

Net Income is a basic formula. Income - Expenses. Sure, a lot of talk focuses on the Expenses side of that, but you'll see lots of topics here about job oppourtunities as well(though those tend to find their way to the Work and Employment board more often).

If you have $1, you're right, there's not a lot of choices in how you spend that $1. But that doesn't mean you don't have choices to make with regards to your personal finances. If you can't cut costs enough, you need to increase income.
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Old 09-11-2014, 01:15 PM
 
Location: Tennessee
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Quote:
Originally Posted by MrRational View Post
multiplied by how many hours actually worked?
(we'll get back to this detail)


Good thing spending adjustments aren't the only choices available... right?


That depends entirely on how much they earn at that $10/hr wage rate.
Which means how many hours per week they work.

5hrs per week & $50?? 30 hrs per week & $300??
What about 80 hrs per week & $800??
Let's just go with 40 hours for a gross income of about $1,600/month.
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Old 09-11-2014, 01:39 PM
 
Location: Verde Valley AZ
8,614 posts, read 9,676,241 times
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Quote:
Originally Posted by Emigrations View Post
Let's just go with 40 hours for a gross income of about $1,600/month.
I could do it and did, for a long time. Right now my absolutely 'have to pay' expenses every month come to right at $800 month. That includes $50 month I'm paying for my mom's Life Alert system. Add on another $400 for food, gas for the car, all household expenses, pets, etc. so $1200 mo. going out. I can still put a couple hundred into savings. Luckily for me though I do have a smallish SS check that also goes towards savings and, I admit, I do spend some on things I want and not absolute 'needs'. Of course, I haven't always had that SS 'cushion' but still managed to save some money for an EF. I usually have at least a couple hundred in checking when the next check gets deposited as well. So, it CAN be done but you have to work at it.

Maybe it's not fair to compare myself with someone who doesn't have that 'cushion' but I managed to do it when I didn't have it so I know it can be done.
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Old 09-11-2014, 01:51 PM
 
Location: The Triad (NC)
28,490 posts, read 62,120,010 times
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Quote:
Originally Posted by Emigrations View Post
Let's just go with 40 hours for a gross income of about $1,600/month.
I'm older. Semi retired. Own my house. Own my car. Don't owe anyone anything.
Exclusive of travel and medical... my day to day expenses are about $1200 a month
and I could shave 20% off that if I needed to.

But when I *did* need to work...
and the main reason why I don't need to now...
I'd never have stopped at 40 hours if all I could get was today's $10 per.

Someone might be able to get by on that (sharing and such)...
but they'll never get ahead or be able to raise a family on it.
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