Directions:
- Do you feel if someone works 40 hours a week that they should be able to support their family with income from that job.
- Discuss with class members what the minimum wage should be set at if it were to represent a "living wage" (i.e., one that can adequately support this family of three) at what level would you set it?
- Reflect on the postings and discuss what you have learned about the working poor and whether you feel the minimum wage should be increased. If you do not feel the minimum wage should be increased make suggestions for other ways to help the working poor meet their basic needs.
- Remember to not just state your opinion but also provide information to support your position.
- Cite references in APA style
Post 1
Hello class,
Category Cost Estimate
Utilities/Shelter $550
Diapers $50
Child care $0-380
Food $400
Transportation $86
Health Insurance $200
Clothing $40
Savings 0
Entertainment 0
With the previously listed table, I finish with a total cost estimate of $1,326, well above the allotted amount. When factoring in social safety net programs these figures would change considerably but we are told we are not taxed so I assume we are also not eligible for assistance programs. I started looking for apartments in the closest metropolitan area, Chicago. After extensive searching, I found that due to the low monthly amount I wasn’t even allowed to view apartments over $750/month. I finally found a two-bedroom (one for adult one for two children) which can be found here (Link (Links to an external site.)) for $550/month and it includes water, heat, and high-speed internet access. The most recent review for this building states, “too much gun shots in this neighborhood and it’s not safe for children”. I was able to find a cell phone plan for $20 /month through republic wireless (Link (Links to an external site.)) but this plan is not available on all phones and comes with 1GB of data. I used the Iowa State University Grocery Budget Calculator (Link (Links to an external site.)) and hoped that in this exercise the adult is able to receive some food from work every day negating one meal per workday. This calculator left me with $429.14 per month on groceries but I would need to spend $60.0 on diapers so food will be tight. Now that I have a place to live, access to a phone (a requirement for many jobs), and food and diapers I am left with no money. I have no means of finding childcare, life insurance, transportation, clothing, savings, entertainment or other unforeseen expenses. This will require that I cut expenses out. We will be forced to lower the grocery bill as much as possible, I will no longer be able to afford my children’s health insurance in a possibly violent neighborhood and I do not know where to keep my children while I work.
Post 2
Housing: $400
Utilities: $125 (gas/electric for small apartment)
Transportation: $88 (monthly bus pass)
Food: $200
Clothing: $50 (shopping at Goodwill and Garage sales)
Childcare: $150
School supplies: $15
Health Insurance: $0
Entertainment: $60
Savings: $72
I developed this budget by reviewing rental listings, postings, and sales flyers. In the end, earning $1,160 and making ends meet for a family of three is almost impossible though I know this is reality for many. It is below the poverty level. I researched the federal and state benefits available at this income level and considered these benefits when creating my budget. I estimated $400 for housing as this family would quality for low income housing. A bus pass is $88 which is much cheaper than having a car and insurance (and likely would be less with assistance). Public transportation is decent in Charlotte but does pose some difficulties when you have small children and need to get around. I included $60 for cable which would be the entertainment for the month. I estimated $150 for after school care. Again, there are benefits for those at this income level and could be at no charge however I would have had to provide contact info to get the information. Medicaid benefits would also be available and it appeared there would be no cost. This family would qualify for food stamps so I added $200 per month for items that would not be covered. Likely they would be able to get a free cell phone and service through a government program so I did not calculate that in to the budget.
All budget items are a challenge in this income range. Applying for any possible state or federal assistance would be a requirement. Food stamps, Medicaid, free childcare services or after school programs would have to be utilized to the fullest possibility at the poverty level. This budget allows for little to no savings for emergencies (like the one we are in now). Not having a car would be a struggle for someone with children. Even living near a bus route would pose many challenges.
I feel housing was my biggest struggle. Low income housing is hard to come by in many areas. The areas where this is available is less than desirable. Meaning, being able to rise out of this situation will be harder. In a city where the real estate market is hot and land is expensive, building affordable housing if a challenge.
A few items that would be left out some months would include clothing, entertainment, and likely savings. At the end of this exercise I really felt bad knowing how many people go through this each month in their lives. It made me appreciate my situation and reaffirmed I need to do more in the community to help.
My Post
Living on minimum wage, with two kids, one an infant
Item Monthly cost
Housing $ 350.00
Food $ 450.00
Utilities $ 100.00
Transportation $ 30.00
Cellphone $ 10.00
Diapers $ 60.00
Miscellaneous $ 160.00
How I developed this budget
To develop this budget, I prioritized expenses in order of decreasing importance. The most important and most expensive budget item was housing. Assuming that I would be able to rely on rental housing assistance provided by the federal government through programs such as the housing choice voucher program, I estimated my monthly housing expenses for a one bedroom, one bath apartment in a subsidized housing complex to be roughly 30 percent of my tax-adjusted income. This is the rate charged to low-income tenants who rent from HUD-contracted, project-based rental assistance programs in some states, like South Carolina (“Low Income Apartments and Affordable Housing”). At a tax-adjusted monthly income of $1,160, this meant around $350 a month, leaving $810 for my remaining expenses. This was the most challenging item to budget. It assumes that I am lucky because all affordable housing programs have a long waiting list.
After housing, the second highest priority item was food. Living frugally, I estimated I could feed myself and two young children on around $15 a day, totaling to another $450 a month, and leaving $360 for the rest of my non-food and non-housing related expenses. I based this food budget of roughly $5 per person per day on the assumption that I would be planning my meals using the recipes and recommendations of a cook book called Good and Cheap (Brown, 2014) which the author designed to fit the budgets of people living on food stamps. I used this guide and followed its cost cutting tips. For example, it suggests to buy unperishable foods in bulk, using versatile ingredients like flour and yogurt that can be used in multiple meals, and buying fresh fruits and vegetables when they are locally in season. I could feasibly feed myself and my oldest child on $8 to $10 a day. Being responsible also for the diet of an infant, I rounded the daily total up to $15 a day based on the prices of baby food and formula seen in my local grocery store.
After food and housing, the next highest priority expenditure is utilities. Assuming my landlord pays for water and waste removal only, this means my utilities include electricity and internet. Assuming my one bedroom, one-bathroom apartment is equipped with electric cooling and heating, and assuming seasonal fluctuation in A/C usage, I estimated my monthly electricity bill to be around $70 a month. Based on the rates of internet service providers in my city, I estimated my internet bill to be around $30 a month for the basic service. These are liberal estimates in how low they are. Budgeting $100 for my monthly utilities, this leaves me with $260 for the rest of my expenses.
After housing, food, and utilities the next highest priority item was transportation. A subsidized bus pass for low-income commuters in my city is around $30 a month, leaving $230 for the rest of my expenses.
A cellphone plan is a necessity of life in this modern era. A cheap limited data plan can run as low as $5 a month. However, this plan is very limited. This leaves me $220 for everything else for the rest of the month.
Also, since I assumed one of my kids was an infant, I estimate at least $60 a month will be spent on diapers based on information on parenting websites. Now, I only have $160 left.
After housing, food, utilities (including electricity and internet but not water, waste removal, or anything else like cable or a landline), transportation, a cellphone plan, and diapers, the rest of my budget goes to unordered miscellaneous expenses. This might include health insurance for my family of three, childcare and school supplies, household items like paper towels and toothpaste, additional minutes on my cell phone, and toys and entertainment for the kids. Childcare costs reliably exceed $220 a month so with this budget and while working 40 hours a week I would almost certainly be needing to rely on a family member for childcare. To stay within this budget, I would have to go without luxuries like Starbucks ($4 for a large coffee a day), expensive skincare and makeup products, and pets.
References
Brown, Leanne. (2014). Eat Cheap and Healthy. Retrieved from https://books.leannebrown.com/good-and-cheap.pdf
Low Income Apartments and Affordable Housing. (n.d.) Retrieved from https://affordablehousingonline.com/low-income-housing-section-8-apartments