Working Class | Common Class | Poor
What is it to be poor and why is there a cycle of poverty that commits generations of people into financial stress? In economics, the cycle of poverty is the “set of factors or events by which poverty, once started, is likely to continue unless there is outside intervention.” Poverty can harm economic growth, societal structures, political stability, democracy and civility. Unlike other world regions, in the United States, poverty is not complete destitution. In the United States, the normal categorization of economic groups has been defined as working poor, working class, middle class, affluent and wealthy. These self classifications seem to be a psychological method to control individuals anxiety regarding their wealth status. Realistically, over 90% of the wealth in this country is owned by those that are extremely wealthy. Here is the shocker, approximately 2% of the population is extremely wealthy. The majority of the US population participates in the acquisition and transfer of less than 10% of this country’s economic resources. So where does that leave the large numbers of working class people? More importantly, how do we use our numbers to break the cycle of poverty?
Common Labels | Common Grounds | Common Goals
In order to regain our social compass, we need to address the economic categorization of each other. Through a realistic acceptance we can encourage one another to respectfully work to normalize our communities. I suggest we assign a two segments of economic categorization. Either your wealthy or you are not. There is nothing wrong with achieving wealth. It should be encouraged and admired. But the same goes for those that are not wealthy. The respectful normalization of those who are not wealthy will take societal changes and a financial educational that help people realize and accept who they are. Once we realize our common and realistic situation, we can work towards a consensus on social goals. Most societal goals requires some behavioral changes, a mature community effort, and a willingness to learn.
Behavioral Change | Emotional | Passive
Behavioral research has determined that adults learn through cognitive reason and make routine choices based on emotional recognitions. For that reason, coaches are more successful than lecturers at motivating and achieving immediate efforts. However, long-term behavioral changes do not result from motivational coaches or lecturers. Individuals develop long-term habits passively and somewhat unconsciously. Habits occur through the repetition of stimulated activities. To better motivate long-term change we must not focus on the stimulus that makes us repeat activity. The behavioral change is the significant actions one repeats once placed in the same situation. The reason so many continue to drop in and out of poverty is because they continue to focus on the stimulus in their lives and not their passive decision making skills. In the field of financial self-sufficiency, financial coaches have helped make preventing poverty fun and passively obtain results. The goal is to help individuals learn to think critically and self discover solutions that make their lives better. Instead of focusing on how to make, save or invest money, financial coaches help people determine their own priorities and set a schedule that can be accomplished. These financial coaches work to help Americans acquire the information and gain the knowledge necessary to plan and take control of their finances. Through these methods individuals gain self-sufficiency and acquire the passive incomes nee ded for retirement.
Working | Economic |Self-Sufficiency
Today’s banking system has become more relevant and more complex in peoples everyday lives. Many seek financial advisers when they should be seeking financial coaches. In part, people have been taught to invest or save for retirement. Prior to this, individuals should be taught to not spend and understand what is wealth. Accumulating passive income is the goal of all who want to retire. Planing skills are essential to retirement even if the plan is never to retire. Budgeting is just one of many skills required in financial planning. Through a discipline of passive non-spending, we can learn to live comfortable lives and save without trying. I would encourage everyone to take at least one financial literacy course in their community. More importantly, you should encourage your friends to do this too.