For a family of 4, the government says that anything below $23,550 a year is poverty.
Honestly, this completely shocks me. How is it possible that a family making that much could be poor? I mean, we make a significant amount less than that, considering that my husband is the only one that works, and he only works part-time. Yet we still are able to have the things we want. We’ve got a savings account and an emergency fund. We bought our own house. We own two cars.
We aren’t rich, but we definitely aren’t “poor” as the government defines us.
So why is it that $23,550 is considered a low-income? Debt.
Anymore, people are told that they have to be in debt to go into debt. If you don’t have a credit score, then you can’t buy a house, or a car, or really do much. How do you get a credit score? You go into debt. You make timely payments and your score goes up. You pay your debt off? Your score goes down. You get punished for not spending money. It’s really a vicious cycle and a horrible method of doing things.
So how does that apply to us?
My husband and I have never had a credit card, and, other than our house and one car, we have no debt. When we went in to find out the amount we would qualify for to buy a house, we were consistently told they couldn’t do much for us unless we had a credit score. Magically, though, once we had picked a house and made an offer, it didn’t matter. We qualified with absolutely no credit history.
Credit cards are not necessary to move forward in life. Neither is debt. The biggest lesson that all young, old, or anyone can learn is that you can’t spend money you don’t have.
My family lives comfortably in our small home. We are able to save and buy the things we want. All this, under the “poverty” line. We do other things as well, such as coupon, but in all reality, it’s the fact that neither of us has any debt that has allowed us to live on just one income.
What do you think about credit scores? Answer in the comments below!