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Blink 3 of 8 - The 5 AM Club
by Robin Sharma
How the World’s Poor Live on $2 a Day
"Portfolios of the Poor" by Collins, Morduch, Rutherford, and Ruthven is a pioneering study that delves into the financial lives of the world's poor. Through detailed research, it offers insights into their hardships, coping mechanisms, and financial behavior to provide actionable solutions for the same.
When we hear about people living in extreme poverty – subsisting on a meager $2 a day – it’s easy to assume that they’re leading the toughest lives out there. And this is only the first assumption we tend to make about the world’s poorest people.
We also often assume that people with little money spend any and all cash as soon as they get it. But that’s not true. People living on an average of less than $2 a day usually set aside a small amount of savings – a nest egg for covering unforeseen expenses and tiding over periods without income.
For instance, Hamid, who lives in Bangladesh, always keeps a little cash on him for emergencies, stashes enough money at home for food and also puts aside the necessary amount for making improvements to his home.
But since most of the world’s poorest people are illiterate, they keep track of and manage their finances through oral communication with their friends and families. For example, a husband might tell his wife that he’s trying to save money for their children’s school supplies, and that he’s going to take a job at a local store to earn some income and borrow the remainder from their neighbor. Now that she knows his plan, the man’s wife can remind him to stick to his commitments.
In fact, the ability to manage money in such ways is absolutely key for extremely poor people. Because their income is usually irregular, paying back loans is a real difficulty. For instance, farmers earn practically all their yearly income during two or three peak months of harvest and virtually nothing for the rest of the year. Naturally, it’s difficulty for them to stay on top of monthly payments during periods of low-income, a fact that makes good money management vital to their success.
Portfolios of the Poor (2009) details the creative financial strategies that the world’s poorest people use to get by. These blinks explain how people with no educational background whatsoever manage their finances.
Portfolios of the Poor (2009) explores the financial lives of the world's poor and provides invaluable insights into the challenges they face and the strategies they employ to manage their money. Here's why this book is worth reading:
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Try Blinkist to get the key ideas from 7,500+ bestselling nonfiction titles and podcasts. Listen or read in just 15 minutes.
Get startedBlink 3 of 8 - The 5 AM Club
by Robin Sharma
What is the main message of Portfolios of the Poor?
The main message of Portfolios of the Poor is that understanding the financial lives of the poor can lead to better solutions for poverty alleviation.
How long does it take to read Portfolios of the Poor?
The estimated reading time for Portfolios of the Poor is several hours. The Blinkist summary can be read in just 15 minutes.
Is Portfolios of the Poor a good book? Is it worth reading?
Portfolios of the Poor is worth reading as it offers valuable insights into the financial challenges faced by the poor and presents potential solutions for addressing poverty.
Who is the author of Portfolios of the Poor?
The authors of Portfolios of the Poor are Daryl Collins, Jonathan Morduch, Stuart Rutherford, and Orlanda Ruthven.