Affluent people should not give money-management advice without acknowledging class privilege.

In Why You Pay for Shit Twice in the Hood., Renina of New Model Minority writes:

How do people pay for shit twice in the hood. Poverty is lucrative. People who own businesses in the hood make money charging incredible prices for the day to day things needed to survive.

The first example that comes to mind is a New York times article where Barbara Ehrenreich talks about the “ghetto tax” and how being poor is expensive. She writes,

  • “Poor people are less likely to have bank accounts..”
  • .”..low-income car buyers…pay more for car loans than more affluent buyers.”
  • “Low-income drivers pay more for car insurance.”
  • “They are more likely to buy their furniture and appliances through pricey rent-to-own businesses.”
  • “They are less likely to have access to large supermarkets and hence to rely on the far more expensive…convenient stores.”

When you add that all up, you really get a sense of how when you live in the hood you pay more for services and products, just because you live in the hood.

The example of how poverty is expensive is Rafi and Dallas’ video Check Mate. Checkmate analyzes why people in the hood use check cashing places rather than banks, why there are arguably no banks in the hood and how check cashing spots,  pawn shops and gold chain shops operate to seperate the people who don’t have a lot of money from the little bit of bread that they do have.

In Spending, Priorities, and Class Divides, s.e. smith of this ain’t livin’ writes:

Financial planning seems like a quaint luxury to a lot of people because, functionally, it is. It should not be, but it is, and refusing to talk about this fact means that conversations about money, concentration of wealth, fighting your way to get ahead in this culture, end up fundamentally skirting over a pretty critical issue. If you start a financial planning discussion with the ground assumption that everyone has money to spare and can trim the budget to make more, you’re pretty much telling a big chunk of your readership to just not even bother.

In Are You Better Off Buying $200 Shoes?, Gwen Sharp of Sociological Images writes:

Further, advice such as that given here present this as simply a matter of being economically smart, rather than as a class issue: unless you’re looking for the type of trendy shoes that you’ll only want to wear briefly anyway, you shouldn’t waste your time at H&M.  Similarly, in grad school I was once told I was “dumb” to rent rather than buy a house, in a town where they cost $150,000+. In both cases, the opportunities provided by economic advantage are perceived as economic common sense, obvious choices for anyone who is smart and has decent taste. Combined with the invisibility of people who can’t afford to spend that much money, accepting these class assumptions allows us to gaze disdainfully at people in “cheap” shoes, confident that they, too, are simply “cheap.”

From Microaggressions:

  • Upper-class activist:: Why don’t you have a cell phone? That’s ridiculous!
  • Me:: I come from a poor family.
  • Upper-class activist:: I guess some people just choose to spend their resources differently.
  • Me:: No, I can’t afford one.
  • Upper-class activist:: You just don’t spend your money well enough.
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