It's the Poor Who Pay More

Michelle Singletary
Thursday, May 21, 2009; 9:04 AM

The writer James Baldwin said, "Anyone who has struggled with poverty knows how extremely expensive it is to be poor."

Recessions have an awful way of proving this true.

These days "you have to be rich to be poor," Post staff writer Deneen L. Brown wrote in a fascinating piece for the Style section.

When you are poor (and according to the Census Bureau, more than 37 million Americans live below the poverty line), you pay more in money, time, exhaustion and hassle, Brown so sadly illustrates in her story in which she details the "economics of poverty." Here are a few of the basics discussed in the article:

* More Money: You don't have a car to get to a supermarket, much less to Costco or Trader Joe's, where the middle class goes to save money. You don't have three hours to take the bus. So you buy groceries at the corner store, where a gallon of milk costs an extra dollar. Example: At the corner store, a loaf of bread costs you $2.99 for white, $3.79 for wheat. At a Safeway in Bethesda, the wheat bread costs $1.19; white bread is on sale for $1.

* More Time: When you are poor, you don't have the luxury of throwing a load into the washing machine. Instead you might have to wait until Monday afternoon, when the laundromat is most likely to be empty, and you put all of that laundry from four kids into four heaps, bundle it in sheets, load a cart and drag it to the corner. Example: It will take at least two hours to do the laundry, waiting for machines to open up for use, waiting for clothes to dry.

* More Hassle: Often there are few if any bank branches in poorer neighbors. So many poor folks resort to using check cashing and payday loan establishments, which cost time and money. Payday advance companies say they are providing an essential service to people who most need them. Their critics say they are preying on people who are the most "economically vulnerable." Example: Harrison Blakeney, 67, uses the ACE check-cashing office on Georgia Avenue in Petworth to pay his telephone bill. They charge 10 percent to take Blakeney's money and send the payment to the phone company. Blakeney says: "I don't have time to mail it. You come here and get it done. Then you don't get charged with the late fee."

Read more from Poor? Pay. Up (May 18). Also, check out the dot.comments blog by Doug Feaver. There were some very angry comments from readers who blamed the poor for their circumstances. But there were also other perspectives from people with more compassion, who understand poverty can happen to anyone.

Chat Today: The Bernard L. Madoff Ponzi Story

Join me today for a live discussion with Gerald and Deborah Strober, authors of "Catastrophe: The Story of Bernard L. Madoff, The Man Who Swindled the World." The book is this month's Color of Money Book Club selection.

The chat starts at Noon ET. You won't want to miss this discussion.

If you can't make it, read the transcript later.

Death Benefits

Imagine this: your husband dies and leaves you, his wife, an insurance policy with specific instructions to pay off his funeral expenses and use the rest as you please. But your husband also had a girlfriend that he was living with because you two were separated, although not legally. Now the girlfriend wants some of the money to pay off debts she and your still-legal husband racked up together.

What would you do if you were the wife? That was last week's e-letter question, based on an Ask Amy column published earlier this month.

Here's what you had to say about this tangled mess:

Atascadero, Calif., resident Tina Salter wrote: "The not-legally-separated-wife is NOT obligated legally to pass on any life insurance money to the girlfriend. If anything, the wife may be responsible for the husband's debts."

"Poor girlfriend!" said Deb Patrick in Marietta, Ohio. "I wouldn't give her a penny. She should have insisted on better bookkeeping, starting with getting divorce papers and a marriage license. Like we all say, 'til death us do part.'"

Here's an interesting twist from reader Ron Ambler. He writes that the wife should ask when the debts were incurred. "If they were incurred when the wife still lived with the husband, then the wife should help clear up only those debts," suggest the Greenfield, Ind., local.

But wouldn't that mean the husband was cheating on her at the time? Hmmm.

Jan Sutton of Cincinnati, Ohio, wrote: "I sympathize with the girlfriend's position; however, the situation is clear. The deceased left the insurance policy to his wife. She has no obligation to the girlfriend. Death is such a loss, and even worse when it leaves financial uncertainty in its wake."

William Erickson of Tampa, Fla., said life insurance is to cover the insured's medical, funeral and other expenses. It's also used as a financial resource for the family. "After 30 years, and being separated another eight, I'm guessing the wife wasn't in a position of needing her husband's financial contributions. Since they were still legally married, the wife may be obligated to pick up any and all left over debts of her husband. That's what lawyers are for."

"I wouldn't give her a dime," says Landover, Md., resident Tabatha Burley. "Let this be a lesson to the girlfriend that girlfriends get nothing. When she was shacking with him, she knew he was married. Lesson Learned: Shackin' and adultery don't pay."

Donald A. Whyte in Lathrup Village, Mich., writes "This is one reason people should get divorced after the relationship has ended because the new girlfriend/boyfriend will not get any benefits when the husband/wife dies."

Here's my take on the situation:

I'm siding with Burley on this one. In this case, if the girlfriend wanted all the rights, privileges and benefits of a wife she should have insisted on becoming his spouse. The girlfriend can ask but the wife has no moral obligation to help her reduce debts she incurred messing around with that woman's husband, regardless of whether they were legally separated or not. Further the husband could have designated the girlfriend as the beneficiary. Why didn't he? They were living together when he took out the policy so why didn't he leave means to take care of her?

I would sympathize with her, but I wouldn't give her a penny.

Repay Your Student Loan Soon or You Pay More

In last Sunday's column, I advised students to start their loan repayment ASAP. I know there are ways to delay repayment -- deferment and forbearance -- and borrowers can extend repayment for up to three decades or opt for graduated payments based on their income through various options. But some recent graduates could pay back their student loans sooner if they budgeted better.

If you are in dire straights regarding loan repayment, check out these Web sites: and

If you have student loans or borrowed for your kid read my column.

You are welcome to e-mail comments and questions to Please include your name and hometown; your comments may be used in a future column or newsletter unless otherwise requested.

Charity Brown contributed to this e-letter.

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