Austerity Living

Financial advice for people losing income is usually insulting. "Cancel your subscriptions." "Make coffee at home." Those tips save $50/month. You need to save $2,000/month. This is real austerity — the actual hierarchy of what to pay, what to cut, and how to survive on dramatically less money while keeping the things that matter for your mental health and recovery.

- User's income has dropped dramatically (job loss, pay cut, divorce, disability) - Needs to cut expenses by 40-60% or more - Currently spending more than they're earning - Panicking about money and doesn't know what to cut first - Needs a clear, prioritized plan for financial survival

### Step 1: The payment hierarchy (what to pay and in what order) When you can't pay everything, pay in this order. This isn't opinion — it's based on consequences. **Agent action**: Help the user build their personal expense hierarchy using this framework. Calculate their monthly minimum. ``` PAYMENT PRIORITY (highest to lowest): TIER 1 — PAY THESE FIRST (survival): [] Food (but see Step 2 for how to cut this dramatically) [] Shelter (rent/mortgage — you need a roof) [] Utilities (electric, water, heat — minimums only) [] Essential medication [] Transportation to earn income (gas, bus pass, car insurance minimum) TIER 2 — PAY THESE NEXT (legal consequences): [] Child support (non-payment = jail) [] Tax debts (IRS doesn't go away) [] Court-ordered payments TIER 3 — NEGOTIATE THESE (call before they call you): [] Car payment (call lender, ask for deferment or lower payment) [] Student loans (apply for income-driven repayment: $0/month is possible) [] Insurance premiums (reduce coverage to minimum required) [] Medical debt (see below — lowest real priority despite what collectors say) TIER 4 — STOP THESE IMMEDIATELY: [] All subscriptions and memberships [] Dining out and delivery [] New clothing purchases [] Any automatic payment that isn't in Tier 1-3 [] Gifts, donations, social spending above zero WHAT MOST PEOPLE GET WRONG: Medical debt and credit card debt feel urgent because collectors call. But they can't take your house or put you in jail. Pay shelter and food first. Always. ``` ### Step 2: The actual big cuts ``` WHERE THE REAL MONEY IS: HOUSING (biggest expense, biggest lever): - If you're renting: can you move somewhere cheaper? Moving costs $500-2000 but saves $300-800/MONTH - Can you take on a roommate? (swallow the pride — it works) - If you own: can you rent out a room? Refinance? Forbearance? - Call your landlord/mortgage company BEFORE you're behind. They'd rather negotiate than go through eviction/foreclosure. FOOD ($200-300/month for one person is realistic): - Meal plan around rice, beans, eggs, potatoes, frozen vegetables, bananas, oats, chicken thighs, canned tomatoes - See: Cook From Scratch skill for the full system - Never shop hungry. Use a list. Buy store brand everything. - Food banks exist and are NOT shameful. Find yours: feedingamerica.org TRANSPORTATION: - If you have a car payment you can't afford: can you sell the car and buy a $3-5K reliable used car outright? Eliminating a $400/month payment + higher insurance is enormous. - If you can bike or bus to where you need to go, do it. - Drive less. Combine trips. Carpool. PHONE/INTERNET: - Switch to a $15-25/month prepaid plan (Mint, Visible, etc.) - If you need internet for job search: use library wifi or negotiate your current plan to the lowest tier - Cancel all streaming. Use the library for entertainment. (Libraries have free movies, music, books, and wifi.) INSURANCE: - Health insurance: if you lost employer coverage, apply for Medicaid immediately if income qualifies. If not, get the cheapest ACA marketplace plan you can find. - Car insurance: raise deductibles to maximum to lower premiums. Drop comprehensive if your car is worth less than $5K. - Cancel any insurance that isn't legally required. ``` ### Step 3: The calls you need to make Most bills are negotiable if you call before you're behind. ``` CALL SCRIPT FOR EVERY CREDITOR: "I'm experiencing a significant reduction in income and I want to keep paying but I need help. What options do you have for: - Temporary payment reduction - Deferment or forbearance - Hardship programs" SPECIFIC CALLS: [] MORTGAGE: Ask about forbearance (3-12 months of reduced/no payments) [] CAR LOAN: Ask about deferment (skip 1-3 payments, added to end) [] CREDIT CARDS: Ask for hardship rate reduction (many drop to 0-5%) [] STUDENT LOANS: Apply for income-driven repayment online (studentaid.gov — payment can be $0 if income is low enough) [] UTILITIES: Ask about budget billing and low-income assistance programs (LIHEAP for heating/cooling) [] MEDICAL DEBT: Negotiate hard — hospitals accept 20-60% of the bill. Never pay the full amount without negotiating first. CALL THESE THIS WEEK. Don't wait until you're behind. Being proactive gets you better options than being in collections. ``` ### Step 4: Protect your mental health while broke Being broke is psychologically devastating. The stress is constant and it makes everything harder. ``` FREE THINGS THAT KEEP YOU SANE: - Library: books, movies, wifi, air conditioning, community events - Walking/running outside: free, improves mental health more than most things you can buy - Cooking: it's creative, productive, and saves money simultaneously - Community: churches, community centers, meetup groups, volunteer orgs all offer free social connection - Learning: Coursera, Khan Academy, library databases, YouTube — free education on anything THINGS TO PROTECT (even on austerity): - One social activity per week (free or very cheap) - Coffee/tea at home (don't cut the ritual, cut the Starbucks) - Physical movement every day - Sleep (this is free and the most important thing for handling stress) THINGS THAT FEEL FREE BUT COST: - Scrolling shopping sites (you will buy something) - "Free trials" (you will forget to cancel) - Driving around to "clear your head" (gas adds up) - Stress eating (buy what's on the meal plan, nothing else) ```

- Never moralize or shame. Austerity is a response to circumstances, not a character flaw. - Be specific about dollar amounts — "cut expenses" means nothing, "$200/month for food" means something - Always prioritize housing and food above all debts - Mention that food banks and assistance programs exist without making the user ask - If the user mentions they can't afford medication, that's urgent — direct to patient assistance programs (NeedyMeds.org) and $4 generics (Walmart, Costco pharmacies)

- The single biggest expense most people can eliminate: a car payment. If you owe $15K on a car and can sell it for $12K, taking a $3K loss and buying a $4K car saves you $400+/month in payments plus cheaper insurance. That's $5,000+/year. - "I can't afford that" is a complete sentence. You don't owe anyone an explanation for why you're cutting spending. - Apply for every assistance program you might qualify for: SNAP (food stamps), Medicaid, LIHEAP (utility help), TANF (cash assistance). These exist for exactly this situation. Apply online at benefits.gov. - Track every dollar for one month. Not to budget — to see reality. Most people are shocked by where the money actually goes. - Austerity is temporary. It's a survival strategy, not a lifestyle. The goal is to stabilize, rebuild income, and gradually restore spending as your situation improves.

```yaml finances: monthly_income: null monthly_minimum_expenses: null runway_months: null tier_1_total: null bills_negotiated: [] assistance_applied: [] expense_cuts_made: [] ```

```yaml triggers: - name: bill_negotiation_tracker condition: "any bill in tier 3 not yet negotiated" schedule: "daily until all calls made" action: "You still have bills to call about. Today: call [next creditor]. Use the script. Log the result." - name: monthly_review schedule: "monthly on the 1st" action: "Monthly money check: What came in? What went out? Are you staying within the austerity plan? Recalculate runway." - name: assistance_check condition: "monthly_income < 200% federal poverty level" schedule: "once" action: "Based on your income, you may qualify for: SNAP, Medicaid, LIHEAP, TANF, and other programs. Check benefits.gov for your state." ```