20 Years of Smooth Sailing to Escape Poverty? BALONEY!
I recently saw an article making the rounds on social media touting that in order to escape poverty in the United States, "almost nothing" can go wrong for 20 years. There have been numerous reblogs and spinoffs based on the hype of the claim, but the root argument is from an MIT economist named Peter Temin, who wrote a book titled "The Vanishing Middle Class: Prejudice and Power in a Dual Economy." His argument is that the American economic system has two distinct classes, the approximately 20% affluent, "predominantly white" upper class that make up managers, tech-savvy individuals, in science and engineering fields, that are generally college educated and have been in the United States at least since the 1960s or 1970s. The other 80% (also predominantly white - why mention it at all for the first class if they're the same?) make up low wage jobs and are plagued by a myriad of enigmatic factors that keep them repressed. Mass incarceration, systemic racism, and others are pointed to to keep the lower class where they are.
Now, there are several issues I have with this - the first of which is that nowhere in the article does it specifically say that it takes 20 years to escape. The only figure it cites is that "a clear path to higher education" (I'm paraphrasing, I encourage everyone to read the article and book for themselves) takes 16 years of careful planning and help. That figure isn't explicitly explained in the article, but perhaps it's outlined in the book. The fact that no compelling argument is given whatsoever warrants additional questioning and research.
So what is a realistic time frame for escaping poverty?
First we have to define what poverty is. For the sake of ease, I defer to Webster:
a : the state of one who lacks a usual or socially acceptable amount of money or material possessions
Well, that's a little non specific. So in applying the term to Americans, I'm going to say it's anyone that doesn't have the credentials or background that can land them a job with anything other than minimum wage. They probably rent and don't own a home. Perhaps they don't own a car. Perhaps they are a single parent. There's a lot of variables that can impact one's ability to escape the poverty trap, but I won't narrow in on if you're up shits creek.
So what does it take? The cheapest path is an iterative approach to producing more income. Let's say you're receiving the federal minimum wage of $7.25 per hour. Working 40 hours a week you are taking home roughly $14,500 per year. So let's go ahead and start answering the hard questions:
Tuition at a community college in the united states is roughly $3,000 a year. It varies from state to state, but that's a reasonable average. Which means the first and clearest path to earning more is to get a two year college degree in some kind of specialized trade. Even if you have to take government loans to afford it, you're only in the hole $6,000 when you get out. Considering the fact that you will likely double your take home income by putting that 2 year degree to practice, you can have it paid back in 6 months if you continue to live with the frugality you had to when you were making minimum wage.
Boom. It's been 2.5 years and you're already at ground zero with loan debts repaid, and have doubled your take home income. You haven't escaped poverty yet, but you're well on your way. At this point you might think about purchasing a car or moving into a bigger space. Just make peace with slumming it, and you will join the ranks of middle class soon enough. If you save for a couple more years, you'll have about 30K in the bank. This should be more than enough to propel you through the rest of a 4 year degree at a public college while working part time. With tuition for in-state residents averaging around $10,000 per year nationwide, You'll burn through your savings just around the time you get that esteemed bachelors degree.
If you have any idea at all what you would like to do, pursue something in the field where credits will eventually transfer to a 4 year degree. That is the most cost effective way to achieve middle-classdom.
Now you've got yourself a college education, and can reasonably have added another 50% to your income. Even the lowest paying college majors make about 40K a year, and you should be higher than that if your goal was to escape poverty. Pretty much that means you got your degree in a STEM field or finance. Remember here. You're not trying to follow you're dreams. You're trying to enable yourself to be able to do that once you've achieved financial freedom. That might mean working something you hate doing until you're out of the trap for good.
In my opinion, if you have a middle class income, you have escaped poverty. The rest of the things associated with that income class come with time (owning a couple cars, purchasing a house, etc). Once you are there, you can begin looking at some of the finer points of this site, among others, to propel yourself into early retirement, or upper middle class. In my humble opinion the jump to upper from middle is far more challenging than the jump from poverty to middle.
6.5 years to escape poverty. That's what it takes according to the plan I have laid out here. It's contingent on several things, and I can't tailor a poverty escape plan for every person under the sun in every condition, but the framework is there. Maybe it'll take longer or shorter depending on your situation with children, or looming debt, lack of transportation, a criminal record, or a bankruptcy. Maybe you'll have to work two jobs for a while to save for community college. No one said it would be easy. But I am saying it won't take 20 goddamn years.
If you are unable to learn and work hard, then I cannot help you. If you ware able but not willing, then you are unworthy of being helped.