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K shaped economy – The year to give back

I am not a big fan of “buzzwords”, but one of them tossed around this year is the “K” type economy (or “K” shaped economic recovery). It refers to how the Coronavirus pandemic has generally done the most damage to families who work service type jobs, since those jobs tend to be lower paying. For those who have not been hit as hard by the pandemic, and that may be doing better than ever, find how you can provide help this holiday season. In addition, studies show people are more happy spending money on others and giving back.

The “K” shaped economy really means that people who work in more service type jobs, that were generally even more likely to live paycheck to paycheck prior to the pandemic, have been hit hardest by the COVID pandemic. Small businesses have also been hit very hard. While people that work in office type environments, that can stay safe, healthy and warm in their home and work from their home, have not been nearly hit as hard. Not only that, the data shows many of those “at-home” office workers have even benefited financially from the pandemic and may be doing better than ever.

Not only are workers in those “home office type environments/industries” much more stable in their job, but many of those workers (about 40 to 60% of them) also hold stocks or have retirement savings, and the stock market is at record highs. In addition, those workers in the “at home” industries have also saved more money during this pandemic as they have lower expenses, such as lower travel costs, restaurant costs, commuting expenses, etc. The bottom line is their stable incomes have led to record high personal savings rates of 10% to 30% plus. This is why many at home office workers have even benefited financially this year.

If there has ever been a holiday season to give back to the less fortunate, this “K” shaped economy is the year to do it. Those workers that are doing well, if not better than they were before, can help other struggling families. As if there is ever a year in which the economy has hurt (if not devastated) millions of people, while at the same time benefiting millions of different people, this is the year. And to the situation more tragic, many of those service workers are struggling due to no fault of their own.

Give back to those on the lower right arm of the Roman Letter K

There are many ways to give back, whether during the holidays or at any point during the year. Either financially or by giving your time or volunteering. We will list a few of the main holiday programs here.

Toys for Tots donations – Boy toys for kids, young teens, infants and others https://www.toysfortots.org/request_toys/donate-toy.aspx

Salvation Army – They have many programs, including Angel Tree, Toys for Tots, Red Kettle Bell (for cash donations), food pantries, soup kitchens and more. Donate or volunteer this holiday season. Find a Salvation Army near you.

Feeding America – They have major distribution centers in most states, but most importantly they partner with tens of thousands of local pantries, soup kitchens, churches and charities to give food to the less fortunate. Donate food or volunteer. Find details on local feeding America here.

Catholic Charities – They help people of all religions, faiths, races, and backgrounds. Most give out free holiday food, meals and groceries too. Find Catholic Charities by state and county.

The above list is more national charities. There are so many other ways to give back as well.

  • Give extremely generous tips to those who work in the service industry that have been hit hard by the “K” shaped economy, whether a server, hairdresser, hotel staff, child care provider, or anyone. Learn about tipping.
  • Shop local. Support your local small businesses. Do not just go spend “mindlessly” at Amazon, Target, or some big box store.
    Volunteer at a local soup kitchen or clothing closet.
  • I always liked Kiva, which is giving small businesses a no-interest loan. They facilitate the entire process, screen applicants and make the loan process simple.
  • Pass out food or work at a food bank.
  • Give back or donate using a crowdfunding platform.
  • Help deliver Christmas meals to the elderly or homebound during the holidays.

As noted, there are so many ways to give back. This has been a year of hardships for tens of millions of people, if not everyone. Whether a financial hardship, stress or anxiety, loss of loved ones or loved ones being so sick or hospitalized from COVID, and on and on. Many people have struggled this year – not just emotionally or healthwise, but also financially.

That being said, the fact is there is a segment of the population that is doing financially better than ever…those who can work from home, have investments, have reduced expenses, etc.

And there is an equally large (if not larger) segment of the population who have maybe had their worst financial year in decade (if not ever) and they are closer than ever to losing their house. Or they can’t feed their family, they have lost their business, they are on the verge of homelessness, etc. A large percentage of their financial hardship was not caused by them or factors under their control.

Now is the time for the people on the “upper right arm” of the “K” economy to give back to those on the lower right arm of the “K” economy.

joncmac

Jon McNamara is the CEO of needhelppayingbills.com, a company that he started in 2008 and that specializes in helping low income families as well as those who are in a financial hardship. He also found NHPB LLC, a company committed to helping the less fortunate. Jon and his team also provide free financial advice to help people learn about as well as manage their money. Every piece of content on this website has been reviewed by him before publishing and many of the articles he has personally written. Jon is the leading author for needhelppayingbils.