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THENEWPOOR
YOUCAN
AVOID JOININGTHEM!
by
Dan C. Taylor
Few, if any, are unaffected by the worldwide recession. What steps can you
take to avoid becoming another member of the "new poor"?
T
H E "NEW POOR"
may
have lived just down
the street from you.
Maybe they worked with you.
Perhaps they are friends or rela–
tives. Now they are jobless or,
even worse, both unemployed
and homeless.
To make things tougher, many of
the new poor cannot even qualify
for general relief because they have
too many
assets that they cannot
turn into cash.
Too Man y Assets
ln the United States, if one has
any
income, or more than $50
in the bank, or an auto–
mobile worth more than
$1 ,500, one does not
qualify for general re–
lief. In the U.S., the
new poor must sell
their assets gradually
to make ends meet
and not until those
assets are liquidated
are they poor
e nough to qualify
fo r help. For them,
the slide has begun
toward permanent
poverty. Accord–
ing to urbanolo–
gist Pierre De-
Vise, the worst effect of poverty in
the United States is that it creates "a
culture of dependency." A culture
from which few poor ever escape,
evento the lower middle class.
Those who have swelled the
ranks of the new poor did have
good jobs. They did have a home,
good clothes. But now many are
living on the streets, in tents or in a
car- and hence are called by dif–
ferent names in different places in
the Western world.
The poorest of the new poor
move from place to place in search
of work and a place to live. In Brit–
ain there are more than 100,000
such people. Across the Channel,
there are 5,000 in Paris alone. And
in the United States, the U.S. Con–
ference of Mayors estimated that
there are more than two million
homeless new poor.
One of the saddest aspects about
the new poor is that they have, by
and large, never undcrstood pover–
ty. Many temporary sheltcrs report
a stunning influx of "good, solid
middle-class families." Men who
formerly made up to $40,000 to
$50,000 a year, men with college
degrees, people who owned nice
homes, have had to hit the road in
hopes of getting back on their feet
again. What is frightening is that
almost any one of us could be in
their place.
Restoring Your Financ ia!
Solvency
How, then, can you avoid
this plague of poverty
beforc it strikes?
One of the first steps you should
take to avoid financia! disaster is to
reduce your debts-assuming you
still have a job, of course. The
larger your debts, the more earncst
you should be. Liquidate whatever
property you must to bring your
debts down to a manageable size.
For most , what is considered man–
ageablc is about 15 percent of your
annual takc-home pay-net, not
gross.
lf
you have trouble controlling
your use of credit cards, cut them
up and throw them away. Credit
can be a tremendous asset if it is
used properly- a curse if it is not.
Remcmbcr, as it says in Proverbs
22:7, "the borrower is servant to
the lender" (NIY throughout) .
By rcducing your debts you will
also have the added benefit of
reducing you r wor r ies, possibly
even your hcalth problems. Thc
next time you Lhink about keeping
up with the Joneses, think about
the accumulation of debts that it
took for the Joneses to get where
they are!
Once you've begun to get your
debts under control, star t a savings
program. Most financia! consul–
tants recommcnd that a family or
individual have at least three
months' wages- preferably six
months'- in savings as a financi a!
reserve. When you take into con–
sideration that unemployment ben–
efits are often limited in both time
and amount, a three months'
cushion is not much at all.
In conjunction with your savings
program and debt cutting, start a
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