Pay to be Poor

[LetterBug]

Got sent into an un- arrangement overdraft and it costs £30. So you are fined for having no money. Meaning when I'm paid I will be £30 down from the off. Meaning I will more likely run out of money again. costing another £30.

Pay to be poor.

@EatSleepRantRepeat

The only time we get lunches and dinners paid is if we're entertaining clients, because we're working during that time. I'd rather be at home with my husband than having to fake being nice to Letchy Ted, but it's part of our job. Even in the case of David Beckham given above, the company have decided its worth them paying for it (its not free!) to build client relationships which bring in more revenue than it costs.

If you don't want to pay 3x subs for something, don't send them or don't have 3 kids. I do agree about bank and overdraft fees though, they're extortionate. Payday loans and ridiculous 400% APRs are glorified loan sharks, and should be legally capped.

Letchy Ted

@BoredZelda

I rent and have smart meters. You don’t have to have prepayment meters if you are renting your home.

But if properties with key meters are the only ones available to you, in your budget, you can’t choose to replace it without the landlords permission. And ones with key meters are the cheaper properties available. I’ve rented many times over the years and it was only when I was moving out of budget accommodation that properties weren’t key meters.

You don't need your landlord's permission to change the metre (other than putting in a smart metre). They don't own the metre, so if you want to put in a normal one, you can.

I agree re the overdraft, they used to get my DP this way. Taking advantage of desperate people who have few other options but to use it. Almost every month he ended up £30 down, just another thing to add to the credit card repayments, loan repayments etc.

He has been very lucky to inherit a bit of money that allowed him to pay it all off, but now he's got to focus hard on trying not to get back in that position.

I'd definitely speak to your bank about getting a small arranged overdraft, even just £20 to save you getting fined.

I always feel the same way when you see them on things like Can't Pay We'll Take it Away seizing people's work vans and stuff in order to repay debt. If people already have debt, how are they meant to get in a position to repay it when the things they need to work are taken away??

In principle, I find interest charged on insurance premiums terribly unfair. If you buy a policy for a year in January, you cannot possibly claim on the element of the premium relating to future months before those months arrive. If you can't claim for the December element of your policy for 11 months, why on earth should you have to pay interest on it from January?

More disgusting than that, though, is the government cashing in on poorer people who can't afford their VED/road tax in one go. Especially considering that older cars generally attract much higher tax charges than the newer, less polluting vehicles, if you can afford to buy one. It's all automated, so it doesn't cost them any more in admin - it's just a way of hitting the less powerful who can't hit back.

These companies/government probably try to justify it as 'giving people a choice' - allowing them to decide if the flexibility of being able to hold on to their money for longer is worth the extra charge to them. In the real world, of course, there is no choice and poorer folk don't have that money upfront to invest/benefit from in the first place.

I think a lot of wealthier folk genuinely believe that poorer people are unwilling to make sacrifices, aren't smart at investing or just aren't good at budgeting. This is the case for some, but many, many less well-off people just never have the privilege to be in that position in the first place.

Great if you can exercise the discipline and self-control to give up buying treats and luxuries to use the money in a more productive way, but when you're struggling to buy the absolute basics, there simply is no leeway or chance to break free.

You are completely correct op, this is the life of my siblings who have worked NMW jobs all their lives plus one sister is very unwell now due to having worked 25 years as a care assistant. I have a very different life to them. The difference is I am the only one who went to University of the six of us.

I had some great perks through work before I retired. My last work place used to book the best restaurants in the city it was based in for entertaining.
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I had another job where we had the equivalent of luncheon vouchers so I had free lunch for six years and they also gave us an allowance to buy two suits a year.

DH before covid travelled overseas a lot and I went with him occasionally so all his expenses were paid. So those breaks were subbed as such. He gets stuff like an upgraded iPad so he has never had to buy one. Both DH and I were given the occasional gift, I know my lovely sister who worked as a care assistant was as her clients adored her, difference is I was given stuff like a cashmere shawl and really expensive perfume whereas she would get a box of chocolates.

I had a poor childhood, DH didn’t and has never ever known what it’s like to worry about money. I remember my Mother fretting, she was widowed with a 9 and 12 year old still at home. I was the 12 year old and learned about budgeting from her.

I think storage space is a privilege

I agree with you! I'm in a 2 bed flat with 2 small boys and I am constantly tripping up over scuttlebugs/scooters/bikes that have been moved from their spot in the corridor.

I do keep the older ones clothes to give to the littlest but I can see why people don't as they take up a lot of room.

I always feel the same way when you see them on things like Can't Pay We'll Take it Away seizing people's work vans and stuff in order to repay debt. If people already have debt, how are they meant to get in a position to repay it when the things they need to work are taken away??

I can't watch programmes like that, as they just make me so angry. Even the title: 'CAN'T pay' and not 'UNWILLING to pay' makes it clear. They always like to make out that it's people who can't be bothered to pay what they owe - 'these lowlifes who think the rules don't apply to them, because they spend all their money on fags, booze and Sky TV' - and whilst this is the case for some, plenty of people are in very parlous circumstances, often vulnerable, and it's just easier to mock them and portray them as selfish scummy wasters.

The poverty trap is very real and pp have given some excellent examples.

Housing is probably the main one. I can rent a small property for £800 per month but I can't get a mortgage on a property of the same value even with a 15% deposit because I don't earn enough. The mortgage payments would be around £400 per month. If I'm already paying £800 pm then surely if I was paying a £400 pm mortgage instead then I could use the £400 pm saved for any repairs that need doing. That's not how it works though so I guess I'll just continue paying someone else's mortgage instead until I can hopefully, eventually increase my earnings (but if course, property prices will have also increased by then)

Also, work meetings. Management have their meetings catered and have nice lunches and cake too. We had our annual team meeting and got one doughnut each as a special treat. On our team, no one earns more than £25k with the vast majority earning £20k max.

Yup, things like this always used to get me, paid more for oil in the long run as could only afford min amt which would go sooner as the dipper thingy didn't go down far enough. Cars bought on hp worked out tons more expensive, interest on loans as couldn't buy things upfront, people who can afford solar panels etc get free warm water etc, electric cars unaffordablefor most but save you money on fuel ... the list goes on. We have gotten out of poverty in the last few years and only continue to face some of these and it makes me so mad

Terry Pratchett nailed this one:

The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money.

Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time - and would still have wet feet.

Housing is probably the main one. I can rent a small property for £800 per month but I can't get a mortgage on a property of the same value even with a 15% deposit because I don't earn enough. The mortgage payments would be around £400 per month
Yes to this, in Ireland and was pay 1200 euro to rent a 3 bed country house with no insulation, now paying 580euro a month to live in a house with great insulation in a lovely area (mortgage). We bought it cheap and I honestly want to kill people who say not everyone needs to own, we will never again get a call giving us 2 months' notice to get out and find somewhere to live.

You need an arranged overdraft, OP.

I realised this a few years ago too. If you are poor, you end up paying more.

It hit home with me when I got a puppy and was talking to the vet. I couldn't decide whether or not to get pet insurance. My DH says it is a scam. My vet asked if I could afford a £500 bill and if I could, not to get insurance, otherwise I needed to get it.

So, I would have paid £900 so far in insurance since I have had my dog. I have only ever had to pay out £100 at the vet for a problem, so I would be £800 worse off, if poorer.

It's true my OH has an American express card he always pays it off in full but gets cash back and loads of perks he also has another card where he gets points for hotels we actually stayed in America for free!! poorer people have to pay higher interest rates and no perks

@WeBuiltThisBuffetOnSausageRoll

I always feel the same way when you see them on things like Can't Pay We'll Take it Away seizing people's work vans and stuff in order to repay debt. If people already have debt, how are they meant to get in a position to repay it when the things they need to work are taken away??

I can't watch programmes like that, as they just make me so angry. Even the title: 'CAN'T pay' and not 'UNWILLING to pay' makes it clear. They always like to make out that it's people who can't be bothered to pay what they owe - 'these lowlifes who think the rules don't apply to them, because they spend all their money on fags, booze and Sky TV' - and whilst this is the case for some, plenty of people are in very parlous circumstances, often vulnerable, and it's just easier to mock them and portray them as selfish scummy wasters.

Yes, and also often the debt is so minimal and it's a massive company chasing for it, yet it increases by having the bailiffs come out and then increases again when they start seizing stuff. Even when they can see the person doesn't have the means to pay the initial debt, let alone the inflated one.

Not saying people shouldn't have their money repaid but I really think stuff needed to work shouldn't ever be included in their inventories, it is not on and puts people in an even worse position.

Yep, can't pay my phone bill on time so add a fee on so it's even higher and harder to pay the next month :)

There's also travel costs to consider.
If costs £50 a week in fuel or bus card etc to get to work, that's a huge chunk of someone's money if they're on Minimum wage, barely noticeable if you're on 100k

If you look at things as more percentage based, I think it becomes obvious that the poor spend a much higher percentage just on getting by, leaving 0% for emergencies and savings etc.
Rent is 60%, insurance 10%, fuel 10%, council tax 10% before you know it, your upkeep exceeds your income.

@Dumbitdown

Yep that's the poverty tax for you. Cant afford to pay your car insurance in one go, then for an extra 10% you can pay monthly! And of course, the further up the ladder you go, the more free stuff you get. If you're really well off, you can even get free food!!

This is basically it.

DP earns relatively well. The amount of free/discounted stuff he and his kids get is astonishing. Private health insurance paid for by his employer for a starters

I thought banks had to stop charging more for unarranged overdrafts than for arranged ones last year? Certainly mine now has the same rate regardless of whether its arranged or not, and no fees payable on top. Admittedly the rate is something like 45%, but for that to cost £30 for going overdrawn for one day, I'd have to be in the red by about £24 grand.

Also, work meetings. Management have their meetings catered and have nice lunches and cake too. We had our annual team meeting and got one doughnut each as a special treat. On our team, no one earns more than £25k with the vast majority earning £20k max.

Amazing how rarely anyone actually picks up on this. Senior management get nice sandwiches, fruit and cakes for their meetings "as they have to work over lunchtime." Our staff meeting is also over lunchtime and they graciously allow us to bring our own lunch along

More seriously moving costs as PP have said. I've probably spent thousands in moving costs (even doing everything myself) over the last decade as living in rentals and landlords often decide to sell/renovate/whatever and you have to move out. Plus the emotional cost of not having a reliable community around you as you have to keep moving on.

And rich people and high up influencers get free food in fancy restaurants in exchange for promoting them etc.

My dad is very well off and often gets his bill covered by the restaurant because they know he brings loads of business clients there and spends loads of money.

You aren't wrong OP.

@MLMshouldbeillegal

the further up the ladder you go, the more free stuff you get. If you're really well off, you can even get free food!!

??? Waitrose having a secret deal where if you show them your bank statement you get a 25% discount?

Would love to know how this works.

Work for a corporate company and do well, you're rolling in free lunches and dinners

This is why free banking has to stop. The poor are subsidising the rich.

NatWest started this farce decades ago and all the other banks had to follow.

I remember Martin Lewis saying that it is like a rich person going to a supermarket and expecting a poor person to pay for part of their shopping.

@Wokahontas

I realised this a few years ago too. If you are poor, you end up paying more.

It hit home with me when I got a puppy and was talking to the vet. I couldn't decide whether or not to get pet insurance. My DH says it is a scam. My vet asked if I could afford a £500 bill and if I could, not to get insurance, otherwise I needed to get it.

So, I would have paid £900 so far in insurance since I have had my dog. I have only ever had to pay out £100 at the vet for a problem, so I would be £800 worse off, if poorer.

It's not just 500 is it though? It's 20 here and there and then one day 8000