Ten Steps To Financial Success For A Minimum Wage Earner

April 28, 2008 by Marcel

There’s an individual who comments on The Simple Dollar (and a few other personal finance blogs) who identifies him- or herself as “Minimum Wage.” This person is singularly focused on the issues of low wage earners, and while his/her comments can be frustrating, sometimes Minimum Wage is really effective at pointing out how some advice simply isn’t appropriate for people in that situation. What good is portfolio advice to a minimum wage earner? What good does it do to talk about how to buy a $200K+ house when you’re making $7 an hour? Not much.

I know where Minimum Wage is coming from. I grew up in a household with a far below average income, and while we may have done all right for ourselves, I grew up around people who existed in true poverty. Thankfully, I was able to take advantage of the great opportunities that life offered me – and the great foundation that my parents gave me as a person – and was able to find a better, financially healthy life where I could raise my children without a regular sense of necessity underlying day to day life.

But what can a person do if they’re in Minimum Wage’s situation? Here are the ten things I would do if I found myself only able to earn minimum wage.

1. Go rural.
It is far, far easier to make a living on minimum wage in a rural situation. There are many small towns where you can find a room to rent for $100 a month and a small apartment to rent for $200 a month. Yes, these really exist – I see them fairly regularly when I get out in the more rural areas of Iowa. Even better, these areas often have lots of jobs for minimum wage workers – I see lots of help wanted signs around these towns and notices inside of town halls and gas stations looking for workers.

2. Don’t drive.
A car is a giant money suck. There’s no ifs, ands, or buts about it, if you’re working minimum wage, your car is killing you. Ditch the car – get whatever cash you can from it. Then choose a place to live where you can get to work by foot or by bicycle. In a small town, it’s pretty easy to reach any other place in the town (and many places in the nearby countryside) on foot or by bicycle, and it’s something that people often do to cut corners.

3. Find the free stuff.
In towns of any size, there are resources available for the impoverished, from free dinners at churches to food giveaways to soup kitchens. The library provides free entertainment in the forms of books, music, and internet access. There are parks, recreational activities, and countless other things even in the smallest of rural towns. Look around for the free stuff and use it – it’s there for everyone to utilize. When you must spend money, be as frugal as possible. Ramen is very cheap, filling, and full of carbs, for example.

4. Don’t be proud.
Pride often keeps people from walking into a soup kitchen. Don’t let it. That kind of pride is an obstacle ground into you by a life in a consumerist society. People who are there to help you want to help you stand on your own two feet – give them that opportunity. Look for every opportunity to help you with your situation, from consulting to WIC to Medicaid to welfare (regardless of my political feelings on it, it’s definitely a resource someone in that position should use). If you don’t know where to start, start off by asking a pastor or a clergyman for help.

5. Minimize your required commitments.
Repaying debts? Call the debtors and explain your situation and ask for an abatement. This won’t get rid of your debt, but it can minimize your requirements for the time being. If you have children that you simply can’t support, look for opportunities to help you with that burden – your family is a great place to start, for example. Don’t saddle yourself with burdens heavier than you can carry or you’ll do nothing but collapse. You don’t become strong by carrying 500 pounds of weight on your back – you become strong by learning how to carry ten pounds, then adding more as you go along.

6. Take every side opportunity you can.
There are all sorts of little opportunities to make more money if you pay attention. Doing things like helping someone shingle a roof for $10 an hour cash is an opportunity you can’t let pass by. Free meals? Take them. Twenty bucks for helping an old man clean out his garage? Do it. Ask around for odd jobs and other small-scale moneymaking opportunities – perhaps even get started on your own “handyman” business.

7. Minimize your possessions.
There are a lot of reasons for doing this. The biggest one is that the more stuff you have, the more money you’ve wasted. Also, fewer possessions mean that you need less room to live. For a while, all of my worldly possessions (clothes included) fit in a single Rubbermaid tub – and that made it extremely easy to actually live in someone’s living room for a while.

8. Make a steely commitment to succeed.
Even after you’ve done all of this, it still takes some serious commitment to make all of this work. You can get yourself in a position where you’re not spending more than you make, but it takes commitment to stay there. Remind yourself every day that you’re not going to waste money and that you’re going to spend less than you earn this week – and this month – and this year. That’s the one way you can get ahead.

9. Save automatically.
So what do you do when you are making more than you’re spending? Take that extra money and put it into a savings account. But just doing that every once in a while won’t cut it. Keep most of your money in a checking account, then go to the library and use the internet access there to set up an online savings account with a big bank, like ING or HSBC. Set up an automatic savings plan there to withdraw $10 a week from your main checking – or maybe even more. Then walk away and forget about it. What will happen? After a year, you’ll have $530 or so in the account. If you’ve put in more weekly, you’ll have even more.

10. Educate yourself.
While you’re putting yourself in a better financial place, spend your spare time educating yourself. Take classes at the nearest community college and work towards some kind of degree. If you need to, transfer to a state university – if you’ve been working on minimum wage for a long time and are actually making strong progress towards a degree, they will help you big time with paying for it. The key is getting started – see what your local community college has to offer.

One final tip: don’t give up the dream.
If you’re working a minimum wage job, either you’re very young, very lazy, or very unlucky. All of these can be overcome, but they take time and commitment and a lot of hard work. It’s very easy to give up the dream of a better life when you’re doing this. Don’t. You can succeed and you will succeed if you spend every day taking steps in the right direction. Surround yourself with people who are also fighting to go in the right direction. Don’t be resentful of people in a better situation than you – instead, use them as inspiration and realize that if you keep on the path, you’ll get there too.

Thanks to thesimpledollar.com

25 Comments

Monty Loree said

am April 28 2008 @ 11:17 am

I make more than minimum wage, however I try to live like I make minimum wage. Your advice of not being proud is a good one. That takes all sorts of things into account. Like not needing to have all of the latest and greatest gadgets, and be fashionable etc.

I live well below my means and practice many things that you’ve mentioned here.
thebaglady said

am April 28 2008 @ 2:00 pm

I think in the same vein as the “educate yourself” step you should add that minimum wage earners should try to get a job that pays more than minimum wage by developing their job hunting and job skills. I don’t think anyone has to stay on minimum wage forever.
FSBO Tips said

am April 29 2008 @ 7:35 pm

Plant your own vegetables. You don’t have to own a home. There is land everywhere, particularly in rural areas. Just find some land that isn’t being used and ask to plant some vegetables on it. Ask an old lady neighbor, for example. Give her a part of the vegetables in return for the use of her land. Everyone is happy, and you save a lot of money.
z said

am May 2 2008 @ 2:58 pm

I saw a newspaper article about a guy who couldn’t get a $20/hr skilled labor job because he couldn’t pass the physical. He said he was stuck in $8/hr jobs that don’t require a physical. How can he not be stuck in $8/hr jobs forever?
Pam Grundy said

am May 2 2008 @ 8:04 pm

I live in West Michigan, and sadly, around here lots of people think an $8/hr job IS a good job. All your advice is great. Education is good, but so is assessing personal skills and building confidence. Sometimes education won’t do a thing for a minimum wage earner except stick him or her with student loan debt to be added to all the other expenses of daily life. Usually everyone has at least one thing they are good at and enjoy. I think finding out what that one thing is and then how to get the most $$$$ for doing it is a good start.
Myfinancebutler said

am May 5 2008 @ 2:33 pm

First of all, I think this is a great post. It’s helpful and thought-provoking. That I have so much to say about it speaks to its’ quality.
Myfinancebutler said

am May 5 2008 @ 2:53 pm

To start, I think there’s lot’s of great advice here. Living in rural place in a great suggestion. As is riding a bike (though it may be tougher in a rural place – especially one with a harsh winter). As are minimizing ’stuff’ and picking up side opportunities. Really good stuff.
Myfinancebutler said

am May 5 2008 @ 2:57 pm

“If you’re working a minimum wage job, either you’re very young, very lazy, or very unlucky.”

But, I don’t completely agree with this statement. Many people working minimum wage jobs may be young, lazy, or unlucky (sometimes all three), but I’m sure not all of them are. More things go into job into job selection than just money… I’m sure people choose into minimum wage situations for varying reasons that are neither young, lazy, unlucky or stupid.
Myfinancebutler said

am May 5 2008 @ 2:58 pm

Finally (and again), great stuff. Especially the last bit (minus the first point. Work hard and don’t give up the dream. Could apply for those working minimum wage, or could apply for all of us!

Thanks!
Monty Loree said

am May 7 2008 @ 8:12 am

It’s all about personal development. If you REALLY want a higher paying job, they’re available. This is North America for heavens sake. If you can’t do it here…. this is the land of opportunity.
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Washington Mutual Online Banking said

am June 12 2008 @ 7:32 pm

I have to second your number one tip about going rural. Too many people forget about the saving you can achieve by living in a rural area.
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am June 13 2008 @ 1:16 pm

First of all, I think this is a great post. It’s helpful and thought-provoking. I congratulate you for doing this nice article. Thanks for the tips.
Bank Offers said

am June 15 2008 @ 7:51 pm

the only thing about this is that 1 and 2 sort of go against one another – living in a rural area is one of the populations most hurt by gas prices because they are the ones always driving everywhere – no public transportation – good article though
James said

am June 20 2008 @ 4:29 pm

very nice pointers you have here, and what i really liked about this is that it is targeted on a specific group. but what i feel is the most important point here is number four… sometimes our success and failure in anything could very well depend on our attitude. and pride can get in the way of a lot of things, things that we need to do, truths that we need to accept… cheers!
Real estate said

am July 17 2008 @ 2:10 pm

Cool tips
Thanks for sharing.
your blog has great articles on finance.
Celina Buy said

am July 22 2008 @ 1:01 pm

I’m a living testament to these tips. I have a part-time job and also work a few hours a week on my own project and am doing better than a lot of people.
Forex said

am August 20 2008 @ 12:58 am

Greet for valuable Tips. I think if someone work on these tips then he would never face financial problems. Great Post
Steven Wilson said

am August 20 2008 @ 4:17 am

Some very useful,and well thought out tips.There are alot of households out there that could benefit greatly if they followed these tips.Steve
Naruto said

am September 7 2008 @ 2:02 pm

I like the 4th and 10th tip for not being proudy and for getting educated respectively and last final tip was awesome too .. People must never give up their dreams and work harder at it .. btw nice post i like it a lot

________________
Naruto Ninja
Stephen McFarlane said

am September 23 2008 @ 10:05 pm

Great tips! I think number 10 “educate your self” and last final tip “don’t give up the dreams” are best one for the financial success for a minimum wage earner. This is post is very helpful and informative. Thanks for sharing, I like it
TheCelebrityCafe.com said

am October 15 2008 @ 1:16 pm

Save automatically is great advice, those who spend on wants when they shouldn’t leave themselves vulnerable to major trouble down the line.
debt-free said

am November 19 2008 @ 5:46 am

i agree that saving little by little make you rich..when we have minimum wage, we have to spend our money wisely.. and we have to try to save the money though it’s hard.. then after have some money in our savings, we invest it.. in business, or investment company.
so we have side earning.
and we have bigger income.. we have to save bigger also..