Why do poor people have to pay extra???

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Even to buy the cheapest car on the lot it costs me more than if someone with a better credit history bought the most expensive. But my credit is not entirely my fault--some stupid crap happened when my old bank was bought out and our account numbers got changed just a little bit. I didn't ask for a new bank and I wasn't fully informed about the change to the account numbers. One of my online payments went astray.

But anyway, I live paycheck to paycheck and sometimes my payday doesn't fall around the correct time to pay my bills. So I have to make expensive same-day check by phone payments or other drastic measures to make sure everything gets in on time.

I couldn't save much when I was younger because I had to take out a loan to go to college and spent all my earnings paying off the loan. All this penalizing the poor makes me just want to say "Screw it" and go live under an overpass. Effort seems pointless.

Because people with poor credit ratings have demonstrated that they are at higher risk of defaulting on a car loan than those with good credit.

also, because as a poor person you have less power to enforce that you are treated fairly, so what incentive do people have to treat you fairly?

Not all poor people are victims of external forces. Many became poor (or remain poor) through their own ineptitude and the choices they've made.

like disabilities or like the OP's credit history, through a bureaucratic snafu. neither situation the fault of the sufferer. your'e so very judgmental, fnord.

I went from being a successful doctor to nearly homeless because of five tactless (yes, i'm an aspie) true words. you could call it my ineptitude. what is ineptitude besides a mean word for disability?

Well, but if it sticks, it sticks. What is disability besides a pandering word for ineptitude?

(hint: the real answer is "whatever society says it is". Always look to the people who have the power.)

There is not a one size fits all type answer for this question.

Circumstances, ineptitude, attitude, and greed all play a part.

Circumstance is the case of the OP

Ineptitude is the case of those who do not understand financial contracts, are not good with numbers, or really don't understand that they are being screwed over

Attitude is the belief that you deserve something or there is no other way to get that object. My brother is a good example of that

And finally greed. That is the side of the financial institutions and businesses such as buy here pay here auto dealers, payday loan outfits, and processes like FICO which are all designed to either fleece the poor or to make more money.

Of the 4, only circumstances are unavoidable but they can be lessened with the right attitude. Ineptitude can be fixed through education, attitude, although dependent on the person, can be changed, and as for greed, government intervention (which I do not like) or simple not doing business with the organizations is enough to stop that.

In the case of the OP, all 4 are present in their post (not being judgmental, just stating what I am seeing based on personal experience as I have done the same thing). There are things that the OP can do to change their situation and stop this endless cycle.

By FAR the most common reason for people being in adverse financial situations is self-destructive behavior. You are seeing the result of people with money protecting their money from people who engage in self-destructive behavior. I.E. don't lend money to people who have not yet committed to having a future (addicts for example).

People with money know this. We had to overcome our own self-destructive behavior before we were able to amass any money. So long as you believe "But my credit is not entirely my fault" or "I HAD to take out a loan", you will be in this hole. Whether or not the statements are based in fact is irrelevant. Until you take control, you will not be in control and you will be 'poor'.

I have lived on the street. I have lived on a 50 cent daily budget for food (2 years) and I made sure my dog ate before I did. How I got there is a long and sordid story, but how I got out is simple. I decided to change my life and to fight hard for the changes I wanted. I chose to budget my spending. I chose to live BELOW my means and save money for a rainy day. I chose to plan for my future instead of living for today. It is not easy. It is harder than institutionalization or bridge life. There is FAR more responsibility.

It has been worth every minute.

I recommend:
1. Planning so you prevent EXPENSIVE emergency methods of making payments. These are self destructive on multiple levels.
2. Reduce your expenses. 100 years ago, most households didn't have a bathtub. Now we 'cannot live' without a cell phone and cable. Ditch the superfluous crud. It is self destructive.
3. Attack vices. Vices are ALWAYS the most self destructive and expensive behaviors. Smoking, drinking, partying and staying out too late with friends always cost more money than you think. Cut it down or cut it out. Chances are that if you are thinking in your head "but I deserve this", it is self destructive and a poor choice for your future. Vices suck the wind out of your sails on multiple levels. Drop them if you can.
4. Change your mind about how you see your role in your life. Don't be driven, drive. Don't be a victim, be the tree that victims cling to in the storm. This is done by planning for your future, meeting goals and leveraging those wins for future advances.

YOU HAVE TO COMMIT TO HAVING A FUTURE. "go live under an overpass" indicates that you have not yet done so. In my opinion, this mentality is root cause to the discrimination you are lamenting.

Most often when I give this advice, I hear, 'I have to spend some money to have fun'. You have a choice to make. Being poor is VERY EXPENSIVE but it is a choice you make for yourself. You can have your little bit of fun now by borrowing against your future or you can save for your future, amass some wealth and learn what fun really is.

Wow! Then my ascetic lifestyle will eventually pay off??? Thanks for your encouragement.

I have no cable or internet at home, Haven't been out late partying in over 2 years, don't have air conditioning, share a car w/DH, have suppressed any pursuit of my "hobbies", do nothing but work at work all day, take care of ADHD son and housework at night. I seriously wouldn't mind walking to work (even in the cold or rain) but DH doesn't like the idea because I have to pass through a rough area to get there. I have been full-time employed at my current job for 15 years, and before that, 8 years. My student loan is paid off. I only have 1 credit card--don't want another.

This is why I don't wanna be a slave/serf. I don't want any attachments like student loans and car payments. Anyway, I learned to do car work myself so I don't have to pay a grand everytime you need a new water pump and timing belt.

Why do poor people have to pay more? Ignorance and "I want it now." Or sometimes "I need it now." With cars, there's so many people scalping cars on Craigslist with WEEKLY payments of like 50 a week. Say a 90s Escort for like 4-5K total payments to own it. It'd be 1k if you saved and bought it outright, but because people need it now now now, it costs a lot more that way. One guy I knew bought a Galant like mine that way, ended up putting like 10k into it with repairs and stuff. Basically they wanna trap you to be poor forever with schemes like this, because it'll make them much more money. Either sell to the poor like ths, or sell to the really rich, easy ways to make lots of money.

Mindsigh, it is not enough to be frugal.

You have to have a plan. Not having a plan will fail you just as badly as blowing all your money on dope.

A plan is a series of short term goals that enable you to reach a long term goal (your dream).

You sound like you have the basic template for success if you do not spend frivolously. OK, good job. Now you need to invest in your future.

Start small. Small enough that you can get by. Large enough that you miss the cash and that it can keep you from making expedient, emergency financial choices. You may have to make short term cuts here. Most people do. I do. The discipline is beneficial on multiple levels and will boost your self esteem and make future saving easier.

You won't always win but EVERY time you do win, you will be a bit richer and on multiple levels.

They ramp up the payments because they can. Poor people are not given the luxury of shopping around.

Disability is an external force in that you did not choose to have.

If your identity was hijacked to ruin your credit history, then that is an external factor. Otherwise, poor credit is your own making.

A bureaucratic snafu may be an external factor, unless you've filed improper paperwork or filed the paperwork incorrectly.

Ineptitude is being unable to perform a task. A disability may be the cause of that ineptitude, but they are not the same thing.

As for being judgmental, let me re-post what I said with the key points in bold type...


... or, to put it another way: Not all poor people are victims of internal forces. Many became poor (or remain poor) through someone else's ineptitude and the choices someone else has made.

"Pot ... kettle ... black"?

Shopping around is not a "luxury" to be "given". It is just something that you do.

I have debt I'm paying off from a business that failed, as well as dental work. I haven't amassed any new debt since my 2010 bankruptcy, and the dental work was because of a new antipsychotic I started taking that causes dry mouth. I've addressed those two issues. I would like to recommend that anybody who doesn't know where all their money goes, get a ledger book, just a simple one from Staples, and write down all your purchases. Make sure to write what all the purchases ARE, not just "Tom's Market, $15" but "chips and beer, $15". Once you do that you will be shocked to find how much money you're blowing. My vices were takeout food and candy. I managed to stop spending on both of those. I only shop at Walmart now. I'm actually losing weight now that I managed to get my spending under control.

My vices used to be soda and other junk food, too. I also used to waste a lot of money on gaming paraphernalia (how many sets of polyhedral dice does one person really need? ALL of them!)