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Old 07-10-2007, 07:52 AM   #21
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Yes, anymore you can get subsidized housing and other stuff....esp. in one of the higher tax, blue states....We have several threads talking about living on 1 million...It would be interesting to compare a working person making 20-25K with somebody making 10-15k....and even 40k vs. 80k, etc. and what the extra effort and taxes really gets you....
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Old 07-10-2007, 10:06 AM   #22
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Originally Posted by Bikerdude View Post
At that income level you would qualify for food stamps, so no food bill. In CT you would also qualify for "section 8" rent assistance. Your rent share might be $200/mo for a 1 bedroom. I think the State pays your utilities at that level too. Not living high on the hog for sure. Most at that level are elderly and or disabled.
I always wonder about this. Does everyone qualify for assistance simply because of low income? Or are there more qualifications to be met: Old age, disability, young children?

It does not seem fair to help a healthy, young, single adult simply because he/she does not want to work or to work harder. At $7/hr, an individual should be making around 14K a year. So anything less than that is by choice, right?
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Old 07-10-2007, 10:28 AM   #23
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No, everyone does not qualify for assistance because of low income. However, food stamps are easier to get than many forms of assistance.

Subsidized housing often has long waiting lists and there are priority categories. A non-elderly, childless and healthy person may very well not get subsidized housing.

And as I have mentioned many times before, state medicaid programs most often require you to be not only poor but disabled, elderly, or with young children to qualify.

There are people who go from job to job or work part time jobs and end up making very little. They may have mental health issues or other health problems, they may not be very bright, but their problems are not deemed significant enough for SSI. (Which doesn't get you above the poverty line but may get you in line for subsidized housing and make you eligible for medicaid). There is a big difference between this way of life and being an extra frugal retiree or pre-retiree with a paid off home and health insurance.

I know people who live by selling blood for cigarettes, eating at missions, shoplifting, and living on the street. Too much time on the street for young people makes it very hard to adapt to non-street life. Pretty good survival skills, really bad social skills.
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Old 07-10-2007, 10:34 AM   #24
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Our rental niche is mostly one bedroom apartments in the $400/month range. Income for many of our tenants is hovering around the poverty range. Poverty is not to be aspired to. Getting and keeping Federal or state aid is an exhausting process that takes up a LOT of time and has lots of gotchas. Latching onto the aid teat seems to tend to trap people - once they are getting aid it takes enough time and effort that getting a work-type income means taking a cut in their standard of (marginal) living. Trapped! Some may be poor by choice, most seem to be poor through lack of ability, or losing the genetic lottery in looks, personality, or intelligence.
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Old 07-10-2007, 10:35 AM   #25
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Thanks Martha.
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Old 07-10-2007, 10:57 AM   #26
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Martha ,
You are so right .LBYM is a choice for us at any time we can give it up & live high on the hog .These people don't have the choce .
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Old 07-10-2007, 12:38 PM   #27
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I think using income as an indicator can be misleading. Since retiring, my tax paid has been:
2002 - 14%
2003-5 - 0%
2006 - 14%

in fact, one of my investments generated a -7.6% rate in 2004. I guess I am statistically part of the non-working poor most years. How do I do it? Cash in some big capital gains and keep all my income/dividend generating holdings in our registered accounts. Keep enough proceeds from CG in Cash to finance the in-between years.

There are programs that can help you with such after tax planning. But if you want a high ratio of income-producing holdings, it may not be possible.

On the subject of LYBM, we have been reducing our monthly nut every year since retiring in 2002. 2007 looks to be breaking the trend so I am bit concerned about inflation at the moment. I think the steps we have already taken may have just established a new lower baseline that we now might follow.

BTW David Rockefeller and David Letterman have both qualified for farm subsidies.
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Old 07-10-2007, 12:49 PM   #28
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BTW David Rockefeller and David Letterman have both qualified for farm subsidies.

Yes, but subsidies encourage stable prices for food...err, or reward certain farm states to move forward other legislation....
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Old 07-10-2007, 01:07 PM   #29
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My cleaning lady drives a car and I do not. Some of my expense categories as as low as possible while I go hog wild in other categories. I'm constantly re-setting priorities. But even so I do live well below my net income, so yes, I LBMM.
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Old 07-10-2007, 01:45 PM   #30
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Just now I was infected with a bad case of "I LBYM more than you do, nyah nyah!" I was sure that the amount I live on was so low, that I was even living below the federal poverty guidelines.

So, I looked up what the federal poverty guidelines are for 2007.

Poverty for a household of 1 (like me) in the 48 contiguous states or D.C. is defined as an income of $10,210 per year, or less. After taxes, take home pay on that might be $680.67/month.

$680.67/month? YIKES!!!

I can't even begin to imagine how I could get by on that. Poor people have to pay rent out of that, too.

Guess my LBYM skills are not as good as I thought.
Uh.... I think you are taking out more taxes than they would have to pay... and they might even get back some money as credits from the fed...

I bet it is closer to $780 per month... and maybe more...
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Old 07-10-2007, 02:00 PM   #31
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Wow. When I was in my early 20's and got myself into too much credit debt, I took on a couple of extra jobs, consolidated the debt and put myself on a very strict budget.

Excluding my rent and utilities, I had $9 per day for everything else...gas to get to work, food, clothes, etc.

That figures, inflation adjusted, to about $580 a month in todays dollars.

That was some pretty meager living. Lots of ramen noodles, and when a mouse got into my ramen stash and of course nibbled a little bit out of each and every one, I cut off the nibbled part and ate the rest. I turned off the heat in the winter and sponged some heat through the walls and the ceiling from the other apartments, and slept in a coat and wool hat. I dont think it was ever over 50 degrees in there.

Even with subsidies, food stamps, cheapo utilities and so forth, I cant imagine living on $680 a month INCLUDING the rent/utilities.

You'd have to get creative indeed.
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Old 07-10-2007, 02:04 PM   #32
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I bet it is closer to $780 per month... and maybe more...
Whew, well then that's much better!
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Old 07-10-2007, 02:10 PM   #33
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Whew, well then that's much better!
Don't be so sarcastic, Nords. Do you know how many nights you can rent that highway overpass with the extra monthly $100?
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Old 07-10-2007, 05:46 PM   #34
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Even with subsidies, food stamps, cheapo utilities and so forth, I cant imagine living on $680 a month INCLUDING the rent/utilities.

You'd have to get creative indeed.
In general, it's touch (if not impossible) to live on $680 per month. The only way is to share expenses with few more people. It's too much uncommon that 4 or more people live in an appointment or a house. My MIL receives a monthly check of $600 and manages to save a couple hundred dollars. She lives with two of her sons in a house that's already paid for. The expenses are relatively low -- property tax, insurance and utility bills are less than $500 per month. The sons pay the bills, however. She uses her money for grocery and do not have any other expenses.

It's true that her situation is unique, but it shows that it's possible to live on a piny budget.
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