Why are some people poor?

[Tysonboss1]

Inq I suggest a lot of people don't have the choice to set themselves up. The reasons for this are many, but clearly not everyone has the same opportunities to to provide a comfortable retirement for themselves. I was making the point that my friend (and probably his work mates) was a case in point. And mitigating against them improving their lot is a business person who will probably provide for his or her own comfortable retirement at their expense.

It's true not every one can set them self up if they have waited to long to start thinking about it, Late 60's early 70's would be an example of being to late. (saying that though colonel sanders was 66 when KFC took off, and nearly was bankrupt 2 years before)

But your friend could have set him self up if he started at 20 or 30 or even 40.

But what is so bad about your friends position if he is on the aged pension and collecting some (probally illeagal) cash on the side.

 

[Tysonboss1]

(saying that though colonel sanders was 66 when KFC took off, and nearly was bankrupt 2 years before)

 

[brianwh]

It's true not every one can set them self up if they have waited to long to start thinking about it, Late 60's early 70's would be an example of being to late. (saying that though colonel sanders was 66 when KFC took off, and nearly was bankrupt 2 years before)

But your friend could have set him self up if he started at 20 or 30 or even 40.

But what is so bad about your friends position if he is on the aged pension and collecting some (probally illeagal) cash on the side.

Obviously I don't know what age group you are in Tyson but if you are familiar with the circumstances of people, now in their 70's, when they started their working life, you would know that, for many, there was little opportunity to accumulate wealth. Typically, once they married, they would support a wife and family on one income. Professional people could earn high incomes but the rest were "battlers".

I know my comments are focussing on the circumstances of a particular age group. And I know that the current pension system is not sustainable as life expectancies increase. But I am uncomfortable with the generalisation that people who are poor are poor because of choices they have made. No doubt some are, but I am sure many are not.

And your final comment that suggests my friend is not declaring this income is interesting. Why focus the focus on him? Why not the illegality of what this employer is doing.

PS: For the record, my friend has told me that he takes a printout of his earnings to Centrelink fotnightly.

 

[Tysonboss1]

1, Obviously I don't know what age group you are in Tyson

2, but if you are familiar with the circumstances of people, now in their 70's, when they started their working life, you would know that, for many, there was little opportunity to accumulate wealth.

3, Typically, once they married, they would support a wife and family on one income. Professional people could earn high incomes but the rest were "battlers".

4, I am uncomfortable with the generalisation that people who are poor are poor because of choices they have made. No doubt some are, but I am sure many are not.
.

1, I am 28.

2, thats complete B/S, They could have bought a home and paid it off over the years this would have a big impact on their position in retirement, they could have purchased an investment property after they had paid of their home, or invested in the stockmarket.

Some one who is 70 was in their

20's during the 1960's
30's during the 1970's
40's during the 1980's
50's during the 1990's
60's during the 2000's,

So their was ample opportunities to spend less than they earned and build wealth, during their entire life their was an active share market and ability to invest in property.

3, Well there are battlers still today and they make a go of it, but some of them sit and make the opposite excuse of "things were easier for the baby boomers we have it harder, they had it easy growing up in a land of milk and honey".

4, They are not bad people and they are not stupid people, But they are 100% where they are because of the decisions they have made. ( the only people I exclude here are the special cases with permanent disabilities )

My grandparents and my partners grandparents are on the pension, and they live full lives, they go on social outings with the seniors club and come to out family get togthers etc. Offcourse they have to watch there pennys but they are not poor, So I don't actually think pensioners have it as bad as what the media make out.

 

[burglar]

I came across mention of Pareto Income Distribution.
So I thought to brush up on the theory.

Googled a few things and came up with link:
http://www.newscientist.com/article/dn7107-why-it-is-hard-to-share-the-wealth.html
Physicists are joining in with Economists.


An interesting piece you might say!!


But I took the greatest exception to this:

"The model seems to me not like an economic exchange process, but more like a burglar process. People randomly meet and one just beats up the other and takes their money."

 

[joea]

1, I am 28.

2, thats complete B/S, They could have bought a home and paid it off over the years this would have a big impact on their position in retirement, they could have purchased an investment property after they had paid of their home, or invested in the stockmarket.

Some one who is 70 was in their

20's during the 1960's
30's during the 1970's
40's during the 1980's
50's during the 1990's
60's during the 2000's,

So their was ample opportunities to spend less than they earned and build wealth, during their entire life their was an active share market and ability to invest in property.

3, Well there are battlers still today and they make a go of it, but some of them sit and make the opposite excuse of "things were easier for the baby boomers we have it harder, they had it easy growing up in a land of milk and honey".

4, They are not bad people and they are not stupid people, But they are 100% where they are because of the decisions they have made. ( the only people I exclude here are the special cases with permanent disabilities )

My grandparents and my partners grandparents are on the pension, and they live full lives, they go on social outings with the seniors club and come to out family get togthers etc. Offcourse they have to watch there pennys but they are not poor, So I don't actually think pensioners have it as bad as what the media make out.

Tyson you have missed one very important point.
In the 60's and 70's a famliy generally only have one provider. In those years is was about having a family and a life.
To purchase a home, you were bound to interest rates basically for 25 years.
If you have a squizz, at one time they were up to 15 - 16% I think.

So do not judge the people of the past on the economics of today.

Another point, in the past people trusted the banks to invest their money in funds. Those funds then got smashed through the years.

Finally, many of the Australian youth now go overseas to work to save money, to invest in Australia.
Then along came Rudd and wanted the difference betwween the overseas tax and the highest rate in Australia. .
The next step they are taking is to be non - resident.
Labor is driving our youth overseas, and that is adding to the skilled shortage.

Labor are attempting to control our lives. Why? Watch the poker machine and betting online caper. it will spread to "two up" on Anzac Day.

I have some knowledge of this, as I am from that era, and my two sons work overseas.
However they have formed a company with a builder to still invest in Australia.

Cheers

 

[nioka]

Tysonboss,

A lot of people my age are poor because of broken promises that were not seen because they were busy working hard bringing up your generation on one wage with their head down and busy while thinking about, and looking forward to, the promised pension providing for a comfortable retirement.

They paid their dues. Many took years out of their life being active in defending this country through active service. They deserve everything that is provided for them and more.

I've posted this before: "The year I started work 1947. there was a new deduction made from our wages. It was a pension provision taken from our wages that was going into a special fund that would give EVERYONE a pension on retirement. No more poverty for the aged. A few years down the track another government looked at the fund, grabbed it with the promise that pensions would still be paid but out of consolidated revenue. A few more years on and another government decided the some people didn't really need a pension so they brought in the means test. This meant that those of us that had paid the most tax and saved got less."

They worked all their life in most cases believing that there was at least a pension at the end.

So now we have your generation with super deductions, paid by their employer in most cases setting aside money for pensions. In a lot of cases those funds are being siphoned off by fund managers to a point where they will not be sufficient to fund retirement. Some are losing most of the money. So how safe IS you superannuation.

So before you think about whether or not a pension payment should be made or why some people are poor just remember it could happen to you. Illness, war, floods, family breakdowns, accident, business failure, theft, etc are all around you and could come to you. My father died when I was 3 leaving my mother with 3 children under the age of 6. No widows pension in those days, only family support. I know what it was like to be poor. I know why SOME people ARE poor.

 

[medicowallet]

Tyson you have missed one very important point.
In the 60's and 70's a famliy generally only have one provider. In those years is was about having a family and a life.
To purchase a home, you were bound to interest rates basically for 25 years.
If you have a squizz, at one time they were up to 15 - 16% I think.

So do not judge the people of the past on the economics of today.

Another point, in the past people trusted the banks to invest their money in funds. Those funds then got smashed through the years.

Finally, many of the Australian youth now go overseas to work to save money, to invest in Australia.
Then along came Rudd and wanted the difference betwween the overseas tax and the highest rate in Australia. .
The next step they are taking is to be non - resident.
Labor is driving our youth overseas, and that is adding to the skilled shortage.

Labor are attempting to control our lives. Why? Watch the poker machine and betting online caper. it will spread to "two up" on Anzac Day.

I have some knowledge of this, as I am from that era, and my two sons work overseas.
However they have formed a company with a builder to still invest in Australia.

Cheers

Yes and I was around in those years too. I think Tyson has a balanced and reasonable view on this.

Housing was much cheaper, and people had great opportunity to purchase their own home.

It is difficult to purchase a home now, and someone in their 70s who worked their whole life had ample opportunity to purchase their own home.

(eg a 20 year old may find it difficult to purchase now, but in 2060, they would no doubt have been in a position where they could have)

 

[joea]

Yes and I was around in those years too. I think Tyson has a balanced and reasonable view on this.

Housing was much cheaper, and people had great opportunity to purchase their own home.

It is difficult to purchase a home now, and someone in their 70s who worked their whole life had ample opportunity to purchase their own home.

(eg a 20 year old may find it difficult to purchase now, but in 2060, they would no doubt have been in a position where they could have)

Medicowallet.
I do not deny he understands.
I was attempting to point out one income provider limits the family somewhat.
Many people purchased houses, which actually set their lifestyle.

Life is not easy, and people attempt to get financial advice, however that advice was generally a rip off. Thats what people find hard.

To explain that a little better. I have a friend that makes money the minute he wakes up.
Originally he got tax advice from Mossman, then Cairns, then Brisbane and now he flys to Sydney twice a year.
Most people do not have that advantage.

I apologise, if you think I came on a bit strong.

In hindsight everybody could be the current middle class.

Joea

 

[nioka]

Yes and I was around in those years too. I think Tyson has a balanced and reasonable view on this.

Housing was much cheaper, and people had great opportunity to purchase their own home.

It is difficult to purchase a home now, and someone in their 70s who worked their whole life had ample opportunity to purchase their own home.

(eg a 20 year old may find it difficult to purchase now, but in 2060, they would no doubt have been in a position where they could have)

I disagree. It is easier now for my grandkids to buy a home than it was in my day or in their parents day. Sure houses were cheap but so were wages. Rent took the same percentage of a wage then as it does now, there were no banks offering home loans on low deposits, there were no first home buyers subsidies, subsidised child care etc. Working hours were longer (I worked five and a half days per week of 44 hours).

 

[Glen48]

The legal system is one of the causes of peoples demise, I read about a woman who got some meat and a then decided she wanted to buy a dress so she claimed the meat was contaminated and sued the butcher the word got out his meat was bad so he went out of business..If we had a legal system what worked on commonsense and had to act like peopel in the real world life would be much easier.

 

[skyQuake]

The legal system is one of the causes of peoples demise, I read about a woman who got some meat and a then decided she wanted to buy a dress so she claimed the meat was contaminated and sued the butcher the word got out his meat was bad so he went out of business..If we had a legal system what worked on commonsense and had to act like peopel in the real world life would be much easier.

You cant be serious? Sure the legal system stuffs up sometimes but thats what appeals are for...

 

[Glen48]

The legal system is good for those who have money and know more about the law than lawyers.
The feds have introduced so many new acts no one know which way is best.
The trade practice act stipulates you pay the money in full and get a receipt and then collect the goods, how many pay a deposit and work proceeds, why can experts use the appeals court for years to fight a case.
Why can people like Skase live over seas and be immune to laws?
In the 40 - 70 your hand shake was as good as any legal doc.

 

[tech/a]

The legal system is good for those who have money and know more about the law than lawyers.
The feds have introduced so many new acts no one know which way is best.
The trade practice act stipulates you pay the money in full and get a receipt and then collect the goods, how many pay a deposit and work proceeds, why can experts use the appeals court for years to fight a case.
Why can people like Skase live over seas and be immune to laws?
In the 40 - 70 your hand shake was as good as any legal doc.

Nieve.

 

[Julia]

Tysonboss,

A lot of people my age are poor because of broken promises that were not seen because they were busy working hard bringing up your generation on one wage with their head down and busy while thinking about, and looking forward to, the promised pension providing for a comfortable retirement.

They paid their dues. Many took years out of their life being active in defending this country through active service. They deserve everything that is provided for them and more.

I've posted this before: "The year I started work 1947. there was a new deduction made from our wages. It was a pension provision taken from our wages that was going into a special fund that would give EVERYONE a pension on retirement. No more poverty for the aged. A few years down the track another government looked at the fund, grabbed it with the promise that pensions would still be paid but out of consolidated revenue. A few more years on and another government decided the some people didn't really need a pension so they brought in the means test. This meant that those of us that had paid the most tax and saved got less."

They worked all their life in most cases believing that there was at least a pension at the end.

So now we have your generation with super deductions, paid by their employer in most cases setting aside money for pensions. In a lot of cases those funds are being siphoned off by fund managers to a point where they will not be sufficient to fund retirement. Some are losing most of the money. So how safe IS you superannuation.

So before you think about whether or not a pension payment should be made or why some people are poor just remember it could happen to you. Illness, war, floods, family breakdowns, accident, business failure, theft, etc are all around you and could come to you. My father died when I was 3 leaving my mother with 3 children under the age of 6. No widows pension in those days, only family support. I know what it was like to be poor. I know why SOME people ARE poor.

Great post, Nioka. So easy to be judgemental about people whose individual circumstances we cannot know.

 

[Calliope]

I suppose it's because they want to claim the Kingdom of God. And also the odds are stacked against the rich getting there.

Blessed be ye poor: for yours is the kingdom of God.

It is easier for a camel to go through the eye of a needle, than for a rich man to enter the kingdom of heaven

While we are on conundrums - Why are poor people fat?

 

[trainspotter]

While we are on conundrums - Why are poor people fat?

ROFL

The primary reason that lower socio economic people are fat is because the unhealthiest and most fattening foods are the cheapest. If you were broke and had just three dollars to spend on food today, would you buy a head of broccoli or a Super Value McMeal with French fries, a cheeseburger and a Coke?

Choosy cheese choosers always choose the cheese in a cheeseburger at McDonalds.

Also might have something to do with never being taught limitations on diet or nutrition?

 

[youngone]

ROFL

The primary reason that lower socio economic people are fat is because the unhealthiest and most fattening foods are the cheapest. If you were broke and had just three dollars to spend on food today, would you buy a head of broccoli or a Super Value McMeal with French fries, a cheeseburger and a Coke?

Choosy cheese choosers always choose the cheese in a cheeseburger at McDonalds.

Also might have something to do with never being taught limitations on diet or nutrition?

Nonsense, $3 burgers cannot be the reason why people are fat. Fat people are morely to order take outs then to cook healthy food. I have been trying to get fat for years (65kg). If i can get fat on $3 burger and not be hungry for the rest of the day then i must be doing something wrong.

On the topic of Fat people. Who is more likely to be depressed? The Fat people or normal people. One would assume, majority of Fat people are lazy and depressive. Or is it possible that they are just fat because they love life and live to eat and eat to live. LOL.

 

[trainspotter]

Nonsense, $3 burgers cannot be the reason why people are fat. Fat people are morely to order take outs then to cook healthy food. I have been trying to get fat for years (65kg). If i can get fat on $3 burger and not be hungry for the rest of the day then i must be doing something wrong.

On the topic of Fat people. Who is more likely to be depressed? The Fat people or normal people. One would assume, majority of Fat people are lazy and depressive. Or is it possible that they are just fat because they love life and live to eat and eat to live. LOL.

Your endeavour to get fat has obviously impaired your comprehension capabilities.

Cheeseburger 900 calories + French Fries 450 calories + Coke 175 calories = 1525 calories = $3.00

Broccoli, cooked, boiled, drained, without salt = 100 calories = $3.00

As the average person requires approximately 2000 calories per day then it is pretty obvious which is the more healthier.

Calliope wrote this "While we are on conundrums - Why are poor people fat?"

You wrote this "Fat people are morely to order take outs then to cook healthy food. I have been trying to get fat for years (65kg). "

I wrote this "If you were broke and had just three dollars to spend on food today, would you buy a head of broccoli or a Super Value McMeal with French fries, a cheeseburger and a Coke?"

Is a McValue Super Meal for $3.00 not "takeouts" ?????

 

[Mister Mark]

Tysonboss,

A lot of people my age are poor because of broken promises that were not seen because they were busy working hard bringing up your generation on one wage with their head down and busy while thinking about, and looking forward to, the promised pension providing for a comfortable retirement.

They paid their dues. Many took years out of their life being active in defending this country through active service. They deserve everything that is provided for them and more.

I've posted this before: "The year I started work 1947. there was a new deduction made from our wages. It was a pension provision taken from our wages that was going into a special fund that would give EVERYONE a pension on retirement. No more poverty for the aged. A few years down the track another government looked at the fund, grabbed it with the promise that pensions would still be paid but out of consolidated revenue. A few more years on and another government decided the some people didn't really need a pension so they brought in the means test. This meant that those of us that had paid the most tax and saved got less."

They worked all their life in most cases believing that there was at least a pension at the end.

So now we have your generation with super deductions, paid by their employer in most cases setting aside money for pensions. In a lot of cases those funds are being siphoned off by fund managers to a point where they will not be sufficient to fund retirement. Some are losing most of the money. So how safe IS you superannuation.

So before you think about whether or not a pension payment should be made or why some people are poor just remember it could happen to you. Illness, war, floods, family breakdowns, accident, business failure, theft, etc are all around you and could come to you. My father died when I was 3 leaving my mother with 3 children under the age of 6. No widows pension in those days, only family support. I know what it was like to be poor. I know why SOME people ARE poor.

Great post, i relate to this people can not relate now unfortunately