Imagine a family with a single mother, we’ll call her Sarah, who is taking college classes part time and working at a restaurant. She has an infant daughter, Jane, and lives with her mother, Ginger, who works part time at a gardening store.
The trio has an available household annual income of around $38,000 — well above the federal poverty threshold for a three-person household, $20,780. They have enough to afford a two-bedroom house in a relatively safe neighborhood, and have a cell phone plan and a television.
But, with the limited income, the household can’t afford a car — whatever public transportation is available in their neighborhood will have to work. They can’t afford the healthiest food, and have to rely on friends and family to take care of Sarah’s child while she and her mother are working.
And one day, when Sarah has no one to watch Jane, she misses work and loses her job. The family moves to a rougher neighborhood and falls further into debt while Sarah’s student loans begin stacking up.
So, what are they?
Across the Capital Region, nearly 43 percent of all households are either living in poverty or within the ALICE threshold, which equates to earning $23,688 annually for an individual — $11.84 an hour.
The ALICE household “survival” budget plan allocates just over $45 weekly for food for a single adult, or $150 a week for a four-person family. At three meals a day, that’s about $1.80 per meal, per family member.
“This number only puts together a basic survival budget,” Rushka Tcholakova, the senior vice president of community impact with the local United Way, said. “But we know that that’s just a survival budget. It doesn’t include all the other necessities. It doesn’t include savings. It doesn’t include paying off debt. It doesn’t include getting a haircut.
“It’s just a survival budget of what people need to make to get by, not to thrive. Not to account for vacations, savings, retirement,” Tcholakova said.
“Many of our neighbors living on this brink of financial disaster has become the norm,” said Peter Gannon, president and CEO of the local United Way. “People are struggling harder, they’re accumulating more debt, and they stay living on that brink. One bad day, one bad incident, an illness, an illness to a loved one, on the brink of being in really serious financial straits.”
However, Gannon said those numbers gloss over the fact that wages have stagnated, and U.S. job growth has not kept pace with the rise in the cost of living.
“We all know that those income thresholds don’t depict the real picture of how much families are struggling,” Tcholokova said. “We know that, for a single person, that person ne to earn at least $23,688 to survive. So we have from ($12,140), to nearly $24,000. That number, now we have a population gauge to say ‘here’s how large this problem is.'”
United Way’s latest ALICE report was compiled using data from 2016.
Also, nearly 45 percent of credit-card holders have subprime credit scores below 620, and one in five households in the Capital Region are either un-banked or under-banked. That means that people living in ALICE could have difficulty getting a loan or having access to the “financial mainstream.”
“Insert payday lenders and high-cost fringe financial services,” Tcholakova said.
Without healthy credit, it can be difficult to obtain a loan to get a car, or even something as simple as a cell phone plan. And with limited additional income, healthier, fresher and more expensive foods are typically shunned in favor of cheaper, bulk food with less nutritional value.
Andy Gilpin is the associate executive director of Captain Community Human Services in Saratoga County. The group offers dozens of programs to address poverty, homelessness and the ancillary effects, like family instability and hunger.
Gilpin attended the presentation, and said his nonprofit and others should reconfigure their plan of action by collaborating with other groups more, and also noted how commonly people fall under the ALICE threshold in the region.
“Populations we work with are continuing to be in that same situation. Economic disparity continues to be a real issue for our clients,” Gilpin said. “They say 43 percent (of people in ALICE). For Saratoga County, for our home county, it’s 28 percent. That’s one in three in people you meet on the street who are just getting by or not getting by … That’s a huge percentage.”
“Day to day, how many people do you meet? You meet 30 people, ten people are not sure how they’re going to make the car payment, not sure if they have to give up on internet this month and fall behind on the credit card payment. And it’s a cycle that keeps repeating itself, and sometimes getting worse.”