So, Which One Are You: Poor or Broke?

One of the most thought-provoking questions I recently encountered was this:  “Are you poor or are you broke?” 

Like many people, I use the two terms interchangeably.  I am, of course,  speaking exclusively of one’s financials.  One can have no money but feel rich in spiritual or other ways.  So let us not touch on the mushy “we are rich because we are healthy and we are together” stuff. 

“Broke” is a temporary condition that manifests itself when you need or want to spend money on something  but you cannot afford to do so at that moment.  “Broke” is juggling your bills, putting off paying one bill in favor of an overdue payment.  “Broke” is that time riiiiight before payday when you have almost nothing in your wallet and in your checking account.

Broke people still have the fundamental things:  food, clothing and shelter.  In fact, these fundamental things are sometimes the reason people are broke — they spend too much on them:  they eat out too often, they have too many clothes or are into expensive stuff, or they live in a house that is above their means.  The current wave of foreclosures is a testament to that.

The best thing about being broke is that there is usually room for improving the situation, like increasing one’s income or decreasing one’s expenses.  A broke person most likely has the power to make himself or herself un-broke.  If the broke person does not make any changes, the situation can only get much worse:  they become “poor”.

“Poor” are the ones with the bare minimum of life’s necessities:  food, clothing and shelter.  They are in this situation because of circumstances beyond their control, or have spiraled out of their control.  Maybe they got hurt and can’t work and is on a very limited income.  Maybe they have some mental ailment or addiction that they could not overcome.  A good percentage of any big city’s homeless population belong in that category.  Maybe they have just been knocked down too many times and just cannot catch a break. 

Whatever the reason for poverty, the “poor” do not usually have remotely easy and legal means to increase income or reduce expenses.  If they were to get out of the situation they are in, they are going to have to pull themselves up by their bootstraps.  Rags-to-riches stories are not just in fairytales.  They do happen in the real world.

So, which one are you:  poor or broke?

Possibly related topic:  Poor Ohioans Are Having Trouble Affording Food

Read Gail Vaz-Oxlade’s blog post that prompted my thoughts on this matter.