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Why Are People Not Efficient With Money?

The last few years have been an interesting window into the financial world of those who are not so great about money.  Prior to 2019 I had discussions with those who were poor with money, but recently I’ve actually had a detailed window into multiple individuals financial lives.  One thing seems to be a reoccurring theme, very few people with financial problems are efficient with money or take advantage of programs available too them.

A Fine Line Between Poor Shaming and Encouragement

Now before we go any further, this post is going to travel the fine line between poor shaming and trying to encourage people to take some initiative.  Many of the stories I am going to tell involve people whom have mental or substance abuse problems.  

If I were to say, look at these programs, if they would just take the initiative I would be poor shaming.  That is not my intention.  Instead I want to call to others attention the need to look for such programs.  Also perhaps it will get people thinking about ways to make these things more accessible or to help others.  A business opportunity perhaps. Encouraging people to be efficient with money can only have a positive impact on the world.

One final note, for privacy purposes I will be in some cases amalgalizing multiple different cases in these stories.  

VA Pension, A Missed Opportunity to be Efficient with Money

We will start with the individual I am now a power of attorney over. He is a war veteran.  DId you know that as a war veteran over 65 of minimal means you can sign up for a VA pension to supplement social security?  It even increases when needed for something like assisted living!  

I know this because that’s part of what I am using my power of attorney for… But besides that point my charge has been eligible for the pension part of this program for years.  Someone even printed out a copy of the paperwork for him.  And yet nothing was done.  I’d guess tens of thousands of dollars were lost over that period in earned benefits.

Real Estate Tax Breaks For Elderly Individuals

Want another example?  In the state of Pennsylvania those over 65 get a rebate on their property taxes.  It’s not insignificant.  The only problem, if you don’t fill out the form at a certain time of year you are not eligible for them.  

Not So Easy Forms.. A Hurdle to Being Efficient With Money

I have seen the paperwork for all the programs I have mentioned above and let me tell you, they have a lot of hurdles for a normal person to fill out.   There are even organizations that pop up devoted to helping individuals to complete these items.  They just seem to be narrowly focused.  They get paid simply by taking a small initial payout out of your newly acquired benefit. Not so bad if the other option is no benefit.

Overdue Tax Bills, A Double Whammy of Fees and No Rebate, Not Efficient With Money

Want something worse?  I have also come across individuals with signficant overdue property tax bills. If you don’t pay those property taxes on time you are subject to a penalty.  How bad?  Well I noted one example where the property taxes were nearly double what they would have been if paid on time.  That individual would also have been eligible for the over 65 discount.  But alas you can’t signup if your property tax is in arrears.  Combined I suspect he paid nearly triple his normal property tax bill.  All for the lack of a form/paying on time.

A Business Opportunity, The Independent Escrow

On an aside a good business might be to determine a way to continue mortgage escrow type services after a mortgage is paid off.  Some people just need that property tax payoff automated and spread across a year. To really work it should just be a check box you fill out when you setup your mortgage. Make it easy.

Another Business Opportunity, The Generic Social Worker

I can’t help but wonder if what is really needed is a social worker type gig that would help with the whole set of eligible items.  Groups like the VA have one, but I’m thinking more like a general person that helps.   It also couldn’t hurt to make these forms easier to understand.

The Basic Savings Account Portfolio, Definitely Not Efficient with Money

Another one from the world of my family members.  I’ve found entire portfolios in high yield savings accounts.  Often with advisory fees of half to 1 percent on top.    Now honestly, we’re talking about low net worth folks here, as per the premise of the title.  10K in a high yield savings account isn’t going to make the poor with money Scrouge Mcduck. 

But if you assume that our not efficient with money individual had 10k sitting in a savings account for a decade, the difference between what could have been a 2-3% high yield savings account and a .2% savings account is 10x the return.  In this case a financial coach or advisor might be helpful.  But I still can’t help but think more holistically would be better.

Hoarding, and the Potential For Assets By Other Means

One final thing I’ve found in the world of the elderly, albeit this one from a different relative.   Even when a family member is indigent, they probably have things of value lying around their house.  From cash in coin jars (I once found nearly one thousand in a family members coin jar when helping them move on to a living facility), to items no longer used and collecting dust.

If the family member is in need of money then the best approach might be to sell those items on someplace like Facebook marketplace.  For cash the best approach would be to get free coin rolls from their bank.  Roll them and the bank will cash them for free.    

And yet those who probably would benefit the most don’t or can’t seem to sell things or roll coins.   At a minimum think of the investment return on this money.   Even in family members who I thought were otherwise broke I’ve found sellable items nearing a few thousand which many didn’t even know they had.  Often times things of value they never would have considered as such.’

Foster Parents and Financial Plans

In any case, we now move to the world of foster care. When a child moves into foster care, every aspect of that parents life gets discussed in court.  As a foster parent you typically attend court so you hear it.  Unfortunately for most parents there is a financial aspect.

Now I can’t speak to you about specific examples, but I will give you a theme from personal experience and even from reading foster parent forums.  When you are asked about getting your kids back they give you what is called a plan.  Essentially it lists the things you need to do to get your life back in order.

As noted typically one aspect of this, and the one I hear statistically is the hardest, is a financial plan.  Simply put, many of those who have their kids removed are either homeless, unemployed, or both.  So typically to get their child back they have to rectify these two situations.

Turing Your Financial Life Around and Becoming Efficient with Money

Turning your financial life around can be a daunting task.  Sustaining it is much easier. Momentum plays into all aspects of life.

The first thing that occurs to me when I think of a financial plan is, how would I ever get a job that can pay for housing and my child’s needs? That would especially be a tough hurdle if I was homeless for a long period.  But here is the thing… These plans are do not usually require you to get a job that pays for housing.   They are get a part time job that shows movement, and we will give you free housing.    Oh and you can keep your kid.

Failing at a Part Time Job

For me I’m thinking, I could go work as a grocery bagger for 20 hours and get free housing and my kid back.  Not a huge barrier to me.  And yet that still seems to statistically be the part of the plan that fails the most.   Why?

Well frankly it’s not a huge barrier to me as I don’t have mental health concerns or substance abuse.  I don’t have a long history of joblessness.    I have a car to get to jobs.   All the things that frankly make my life easier then those that are poor and inefficient with money.

How to Help the Disadvantaged, A Problem That Remains Unsolved

But it is for some of those who live in poverty.  They do not have many of these things I take for granted.  I honestly don’t know what the solution is to improve this for those out there.  I just know what organizations do today doesn’t seem to cut it.  Too many people fall through the cracks.   

My Purpose for Talking About Being Efficient with Money

Now this is not a plea for government involvement, this is a non-political site.  But I still wanted to highlight what I have seen for several reasons.  First to ensure we all remember not to take for granted that some aspects of your life may be easier then others.  Check the judgement at the door.

Second, if someone is reading this and has one of these issues, perhaps it will encourage them to explore programs to help.    For the gaps I have noted maybe some interpid individual with some time can create a company to fit one of these unmet needs.  I can hope.  

And lastly, for those with loved ones and other people in their lives of lesser means.  Keep an eye out for some of these things and where possible help to guide those individuals to any programs already available

No Matter Your Financial Life Stage, Don’t Forget Those Around You May Be Struggling.

Anyway, I know this was a bit off topic from our normal audience of higher income individuals.  But even as a more fortunate individual you likely have friends and family who are not.  It’s important to remember they have their own challenge.  

Efficient in money to me is an extra 500 dollars in credit card churning.  A number that is just on the cusp of being budget relevent  Efficient in money to someone who is less advantaged  can mean tens of thousand of dollars, and even at 500 might have a signficant impact on their lives.  It’s important not to forget that.


  1. You know that this article was not what I had expected.
    I should feel privileged that I am not in the same position as some of the circumstances you describe.
    I hope that my kids will neither when they grow up.

    Very good article that’s made me think carefully about the position that we are in – comfortable, stable and when I think about efficiency with money it is in terms of base percentage points of ETFs not financial plans to keep my kids!

    Thanks – great post FTF!

    • FullTimeFinance
      FullTimeFinance July 19, 2020

      Glad you liked it.

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