Sending out benefit payments once a month to recipients of social assistance is certainly easier and more convenient for processing and distributing the funds; but how does a once-a-month payment schedule affect the recipient living on a low fixed income?
Sending out benefit payments once a month to recipients of social assistance is certainly easier and more convenient for processing and distributing the funds; but how does a once-a-month payment schedule affect the recipient living on a low fixed income? Having a weekly pay cheque is something most working people base their monthly budget around. And by habit, or by design, most of the working world lives each month in quarterly rounds of “Who do I have to pay this week?”
And let’s suppose that by mid-month you see that you’re falling a little behind in the kitty, you would still have time and an ability to make up the shortfall by months end. You could opt to reduce or forgo purchases for a few weeks, work more hours, or even cover the deficit with credit (debt). Whatever way you may choose, the proverbial ‘Stealing from Peter, to pay back Paul’, now comes into play.
But those are options that a weekly paycheck offers; allowing 4 attempts to stretch your dollars over the month, so you can adjust your income and expenses to compensate for variations in your cost of living. However, this ability to offset financial shortfalls is not as simple for recipients of social assistance. Not only because the income assistance is set below the cost of living- which invariably puts recipients at an automatic disadvantage to support themselves; but also because there are no ‘Peters’ in poverty.
So, every month recipients ride this precarious wave of have, and have-not. And it’s not just a financial dilemma; it has a negative emotional and psychological impact as well. The term ‘Three day millionaire’ is an expression of an idiosyncrasy of life in poverty, and is in direct reference to the drastic swing from weeks without any money, to instantly having hundreds of dollars in hand.
This is an issue with lump-sum payments, as it creates a false sense of wealth; add to this the fact that most recipients have been flat broke for the previous 2-3 weeks, and we now have the perfect scenario for financial failure. And, for far too many people that I’ve met, this happens each and every month, year after year. And this happens, in part, because it is more difficult to effectively manage income and expenses with one cheque per month, while expenses come up at various intervals throughout the month.
Yet, for someone trying to get back up on their feet, weekly efforts at managing finances can be more effective and beneficial in learning the basic fundamentals of money management. With a better ability to manage your own personal finances, it can build financial self-reliance, stability, and even growth. This fosters self-confidence, pride, and optimism, which can further empower people to rise above their current situation.
Rebuilding your life, while living in poverty, is an incredibly difficult challenge for even the most determined of hearts and minds. And, for impoverished people to be paid in similar intervals as a Rock Star receives their lucrative royalty cheques, just doesn’t equate to me. It just doesn’t provide the best opportunity to get out of the system.
Try it while living in poverty,
Try it while living on the streets, or in a shelter,
Try it, without Peter.
There is little chance that the money will go very far at all.
* You now have 27 days remaining before your next cheque, and your bank account is empty…