Homeless with a 401(k)

by Shannon Moriarty · 2008-12-05 08:18:00 UTC
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Yesterday, blogger-extraordinaire Andrew Sullivan pointed to a seemingly wild observation by a financial literacy counselor for homeless single mothers (who also happens to write for the Economist).

This economist was baffled to learn that many of the single women he met who were living in a homeless shelter with substantial credit card debt also had 401(k) plans. What's even more, they didn't want to touch these accounts despite their financial hardships.

While this baffled the economist from a dollars and cents perspective, I think it makes sense. Most homeless people, especially families with children, do not see their situation as permanent. They view it as a bump in the road, something they'll overcome quickly. In their minds, they'll get back on their feet, move out of the shelter, and live a normal, housed, happy life - complete with a retirement.

Besides, if the thought of retirement money in the bank provides the motivation needed to survive the dark, difficult days of living in a homeless shelter, then why not?

That being said, I highly suggest you click on over to the Economist writer's journal where he explores similar issues from his experiences teaching financial literacy to homeless women. The author is a libertarian with a PhD in Economics, so it's interesting to observe how he seems to identify with the homeless women's struggles to become financially independent. 

 

 

Shannon Moriarty has worked in various homeless shelters and service organizations around the country. She is a graduate student studying housing and urban policy at Tufts University.
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