Great 'what costs more for if you're poor?' Hunt revisited

cradbent

raddyantic wrote: »

When I was up in a very rural area in Scotland they had oil fired heating and most people were buying in bulk together once every couple of months. Definitley something to take into account though if you're thinking of living in a rural area which uses this type of fuel as like you say there ain't too many options.

I live in a rural part of North East Essex and we are members of an oil buying group which covers a fairly large area of Essex and South Suffolk. Everything is set up from a website, so you just "order" your oil for the next quoted buying period. Then on the actual date the co-ordinator contacts all the main oil companies in the area and gets the best price. Last month it was over a 100,000 litres. We normally shave off at least 2p per litre and quite often it's a lot more. I'm not allowed to post links so if anyone's interested get in touch and I'll let you have the link. It also saves on a lot of tanker miles too as deliveries are grouped.

John_Pierpoint

alfielibby wrote: »

I think the point is that the ACTUAL cost of things is the same irrespective of whether the person buying it is rich or poor: it wouldn't matter if you earnt £100 pounds a week or £10000, if you buy pre-pay electric it will be the same price per unit for everyone.

To my knowledge there is no company that bases it's prices on the income of it's customers and charges lower income people more that higher income people for EXACTLY the same service.

But if you are poor you will be paying via a pre paid meter because:
1. you dare not get into debt.
2. The supplier is not prepared to extend credit to you because you have no net worth and perhaps no "prospects" or guarantor.

Using a system that sells small quantities of fossil fuel via a third party must make the fuel more expensive per unit.

Dannybob

The NHS, police/fire services etc...

Seriously though, the people I feel for are those who are working hard to earn a small wage (cleaners, waiters/waitresses, shop assistants etc).

When you earn enough not to be on benefits but then have to pay for all the things that people on benefits get for free it becomes very expensive to go to work.

I grew up in a poor but hard working family so have experience of this. I'm doing quite well now (though not rich!).

So I guess my answer to the overall question is that if you're very 'poor' things overall are cheaper. If you're well off to rich then things overall are cheaper. If you're considered to be earning too much for benefits but not enough to actually live and pay the bills then things are expensive.

It's all relative...

Greenantobe

The real issue is that poor people do not always have the alternatives that better off people have (and I'm talking really poor, not smoking, drinking and buying brand name trainers poor!).

My eyes were opened to this at a 'drop in' lunch that my mother runs. Although open to everyone, this is predominantly attended by poorer people. She provides a square meal one lunch time a week for carers and their pre-school children.

When talking to one of the girls that attends, she was mentioning how expensive her grocery shopping is, and I asked why she didn't use the big store that I drive to once a week - well, of course, she can't afford a car and so cannot get to it (and it is definitely not short enough a distance to walk / bike to).

We are by no means rural, we live in a small town, with local shops and other amenities, and a larger town nearby, but she had no access to the kind of bargains that I was getting by travelling. She also found the minimum order amount and the delivery charge prohibitive (she is literally counting every last penny).

We did find a solution - as a group we do a weekly grocery order from a large supermarket and have it delivered to our 'drop in' group. Each carer can then carry home what they have ordered themselves. The organisation that runs the 'drop in' pays the delivery charge, and the mums / carers can take advantage of bulk buying discounts by buying together. I am also pleased to say that this has helped my mother and I to share some of our budgeting tips for the weekly shop, such as menu planning (despite being a mother, I am considerably older than a lot of these carers).

These carers didn't have the choice of buying cheaper things from the supermarket, but I guess their backgrounds also meant that they were not prepared for budgeting. We are working on that, but there must be so many more of them...

kboss2010

I agree with both sides of this argument. Buying in bulk/paying annually requires the ability to forward plan for the things you may need up to a year down the line and have the discipline to stick to a budget and save money for a specific purpose.

I know people who spend their lives borrowing from door-to-door loan sharks and/or payday loan companies because they must have something now rather than wait until their pay/benefits comes through. These people then spend the next month worse off and borrowing more money to buy even more things that they must have right now when if they had simply waited they would have been able to afford what they wanted cheaper and debt-free (i.e. no interest!).

There are also people who for any number of reasons struggle to afford bills despite their best effort to budget and cut back, nevermind save enough to cover next year's bills at the same time.

There are not so many of this second group of people and most people who claim this would be quite happy to buy a few beers/cigarettes/bingo/lottery tickets. It is also unfair to the people who really can't afford these things when people say "I'm skint" and then go and buy a new something-or-other that they don't need.

Borrowing money is more expensive if you have a bad credit rating. You're more likely to have a bad credit rating if you have ever not been able to pay your bills on time, hence it is likely that utilities are more expensive for poor people who can't afford their bills sometimes.

However, there's no reason for using transport as an excuse. The simple answer is that if you can't afford to pay to get to where you need to go everyday (i.e. work) then you can't afford to live there on your income and may have to consider moving, maybe to another city. Yes, moving is a hassle and jobs are in short supply but surely it's worth the effort trying if you would be financially better off and less stressed? Graduates like myself are constantly told to "move where the jobs are" and that's a reality we face yet older people who have been working for a long time seem to feel entitled to a job where they live because they're settled.

An0n_2

lazer wrote: »

You only have to use the pre-pay meters if you get into arrears which is a not a direct result of being poor - it is a result of bad money mangement (which can happen to rich and poor)

If you move into a property with pre-payment meters you have to pay to have them replaced with credit meters, your credit history and money management are irrelevant. You cannot shop around for the best price - you have to go with the current supplier. Most housing association accomodation has pre-payment meters and those being allocated a property are the poor; therefore they have this finanical hurdle to overcome that the rich do not. There is no help for those on benefits or vulnerable groups and the cost of changing both gas and electricity meters is about £200. The poor, being poor, generally do not have large sums of available cash to meet these expenses.