Who is ALICE?
Living paycheck-to-paycheck making $60,000 a year? There are many factors that you have no control over and others are in my control. To talk with you about the areas you have no control over I need to introduce you to A.L.I.C.E. (Asset Limited Income Constrained Employed).
I first met A.L.I.C.E. reading the 2017 Aloha United Way Hawai’i Report. A.L.I.C.E. households make too much money to meet the Federal Poverty Level but still struggle to pay their bills and create some savings or wealth. The report also says that a majority of our income goes to pay for housing, child care, food, and transportation.
At that time what I got out of that report was that people in Hawai’i (2015) need to work extra hours or jobs to just survive and that a majority of us because of the cost to live in Hawai’i, and even some financially bad decisions on our part have difficulty getting ahead financially. In 2015 a large portion of ALICE households were families with two employed adults and two children. Their annual Household Survival Budget for a Hawai‘i family of four (two adults with one infant and one preschooler) is $72,336. However fast forward to the 2020 ALICE Report, we find that the same household family of four annual Household Survival Budget has increased to $90,828. Additionally, the 2020 report, marked an increase in ALICE single or cohabiting adults under age 65 with no children under age 18 made up the largest proportion of households in Hawai‘i (43%), as well as the largest share of households below the ALICE Threshold (44%). It is really the wages and cost of living that can move a household from surviving to thriving. With a household of 4, the adults need to be making at least $20 an hour to meet their annual budget. Many times household members have more than 1 job to sustain their household.
Personally, I have taken responsibility for my own poor financial decisions. In the last two years, I have moved from a lean survival budget (just able to pay for necessities) to a financial control budget (able to pay necessities while paying down debt). Being stripped down to nothing as far as income forces you to re-prioritize what really matters financially. Then once you increase your income, you can look at how to create a stronger financial foundation. It's an opportunity for a start over. A traumatic experience is not necessary for you to decide to re-start in the re-creation of your financial foundation. I stripped away all my online subscriptions, decreased my streaming services and reviewed my insurances, uploaded store coupon apps, and created zero-based budgeting that I reviewed weekly.
None of the suggestions mentioned above were based on any intelligence or insight on my part. My only part in getting better at my finances was prayer, paying attention to the Holy Spirit. I move when the LORD says, “Move”, or stand still when He says, “Stand”. Through a series of financial blessings, I was able to pay off substantial debt and I am currently whittling away at the remaining debt. I have also been able to save some money. Because I prayed for financial help I learned like Nehemiah I had to build my walls to control my income and expenses so money stopped flowing out without me knowing where it was going. Also when I did receive blessings I used those blessings for what I prayed for...to pay off my debt as well as invest in myself, by enrolling in the Ramsey Solutions Financial training and budgeting. I now have created financial priorities as I have done for my health and career.
ChangeMakers is really interested in finding solutions not just for those Hawai’i households living at or below the poverty level but also those ALICE households. Our strategies are multi-faceted and include entrepreneurship training, personal financial literacy, and starting financial literacy at younger ages for those living in generational financial hardship. If you had seen where I came from you would know that me sharing this story with you, even though I haven’t reached all my financial goals, is truly the hand of God...and so I would encourage whether it is your financial, health, education, marriage, family or career the best consultant, coach and/or mentor to have on your team is God.
