
New Perk for Fast-Food Workers: Finish a Shift, Get Cash to Go - petethomas
https://www.bloomberg.com/news/articles/2019-05-17/new-perk-for-fast-food-workers-finish-a-shift-get-cash-to-go
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bengerbil
First thought - "that's just enabling bad budgeting"

But then I realized -- waiting a week, or two, or a month might be considered
a loan to the business. Should you get a 2% annual interest for waiting to be
paid? Or, because this is already the model everyone's been using for so long,
does it not really matter? So now I don't even know where I stand on it.

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jopsen
It would be nice if payroll and taxes was resolved on daily basis why not?

My first thought was that this is only necessary because they pay is so low.

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esilver
Doing away with fixed-duration pay periods may help workers better respond to
unplanned expenses _and_ sidestep usurious payday lenders.

I would be especially interested in seeing banks offer or partner with
services like these as a way of helping unbanked low-income workers access
financial services.

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philwelch
I think this will actually increase payday lending. If you have weekly-to-
monthly pay periods, you get a paycheck approximately when rent is due so you
can pay your rent. If you got paid daily after every shift, there’s nothing
stopping you from blowing that money and failing to save up for rent, so you
have to borrow your rent money at the end of the month.

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esilver
You may have a point; workers could start living _instant deposit to instant
deposit_ instead of _paycheck to paycheck_. But I don’t think this is as
likely.

I’m inclined to think workers who would have turned to payday lenders in the
past to pay for groceries or a cell service bill might instead wait until
after their next work day to initiate an instant deposit. It’s easier to do so
in an app than it is to visit a payday lender, after all.

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grawprog
I've worked with many day labourers who get paid daily, their money is gone
before they get home. I also worked a job where I got paid weekly instead of
bi-weekly or monthly, it was almost impossible to save money. I don't know
why, but I find it much easier managing money being paid every two weeks than
in durations shorter than that.

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philwelch
In those situations, I've had my paychecks deposit into my savings account and
"pay myself" out of that savings account at the first of the month. I would
recommend this algorithm in general, actually--give yourself a zero-based
budget, stop around the point where it's measurably below your monthly take-
home income, and then pay yourself that amount every month out of savings
while backfilling your savings from your income. If you have an emergency,
take it out of your savings. If your savings get big enough, dump some of it
into your IRA or get yourself something nice.

I think part of it might be down to numeric intuition. If you get paid $250 a
week or $1000 a month, that's the same amount of money, but $1000 is a big
enough number that you think in terms of, "ok, $300 for rent, $200 for
groceries..." whereas $250 per week makes you think, "hey, I can blow all of
this at the bar because there's another $250 next Friday and I'm sure I can
scrape up the extra $50 for rent by then". $50 per day makes it a lot easier
to blow the money because you're only ever blowing $50 at a time.

And I don't want to make it seem like this is because poor people are stupid.
_I 'm_ stupid. There are days when I reason, "hey, I can totally eat a pint of
Ben & Jerry's today, it's just one pint, I can make up the calorie surplus
some other day", but it just adds up in the long run and now I'm fat. And this
is exactly the same intuitive gap that would lead someone to blow daily or
weekly paychecks far more recklessly than they would blow a monthly paycheck.
(Relatedly, I hear that meal planning is a good strategy for losing weight!)

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Griffinsauce
> And I don't want to make it seem like this is because poor people are
> stupid.

Well, financial pressure reduces your IQ.[0] Poor people aren't "stupid
people" but they can more easily make stupid descicions (and of course have no
way to recover, creating a downwards spiral)

[0] [https://www.princeton.edu/news/2013/08/29/poor-
concentration...](https://www.princeton.edu/news/2013/08/29/poor-
concentration-poverty-reduces-brainpower-needed-navigating-other-areas-life)

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RenRav
Is it actually cash? That seems annoying having to convert it to digital so
you can buy stuff online.

