How to Live on $25 a Month

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How to Live on $25 a Month

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Try to imagine living on $25 a month— less than $1 a day. That’s how much the average worker earns in the West African country of Ghana. Yes, that’s the average, which means many people live on less. Because of the gap between rich and poor, and because many at the upper end of the income scale are extremely wealthy, it is accurate to say that most Ghanaians live on less than $25 each month. Yet Ghana isn’t the poorest country in the region.

Ironies abound. I’m writing this on my laptop computer at a desk in one of Ghana’s relatively less-expensive hotels in Kumasi, capital of the Ashanti region and Ghana’s second-largest city. One night in the hotel, with tax, costs the equivalent of two months’ wages for the average Ghanaian, perhaps three months’wages for a hotel employee. My laptop, moderate by American standards, cost the equivalent of more than four years’ wages for the average citizen.

It’s impossible to eat a meal in a restaurant in this country without thinking of comparisons. Most meals are reasonably priced by Western standards, but the cost of one would feed a Ghanaian family of five for two days. So how do they do it? How do people here manage to live on such meager incomes? It’s no wonder Ghanaians have been called magicians.

Ghanaian realities

Let’s see how it works.

Rent is cheap—unless you insist on good accommodation. Westerners who move to Ghana on one- or two-year employment contracts can pay $2,000 per month in rent for a Western-style home, money that goes to the wealthier members of Ghanaian society. For most Ghanaians rent is 30,000 to 50,000 cedis (pronounced “seedies”) per month.

Sound like a lot? Not really. Fifty thousand cedis is about $7! There are 7,000 cedis to $1. Go to a bank with a $100 bill and you will walk out with 700,000 cedis for it.

What do people get for $7 per month? One room and a chamber (hallway) is the norm in an old ramshackle house that saw better days 50 years ago. Kitchen and bathroom facilities are shared with the other residents of the building. Although “only” 50,000 cedis per month, residents must pay at least six months’ rent in advance, and three or four years’ rent is becoming the norm before a family can move in. That’s as much as 2.4 million cedis. You don’t have to be a mathematician to realize that 2.4 million cedis on a salary of 175,000 per month is impossible for most people.

Added to the rent cost is the price of utilities, unreliable at the best of times. The average cost? About 50,000 cedis per month.

After rent and utilities, Ghanaians must still pay for food. A family of five needs about 30,000 cedis per day, enough for two meals. Breakfast is bread and porridge made from maize. The evening meal varies but usually consists of yams, cassavas or plantains or a popular local dish called fufu made from cassavas and plantains. These are pounded together to form a substance that feels like dried glue. Most of these staples are served with soup or stew made from local vegetables and the occasional fish or other meat.

We haven’t finished yet. There’s transport to pay for. Most people rely on taxis to get them to and from work. Few hire a taxi for themselves. Taxis travel along popular routes and pick up people who are going their way. It can take two or three taxi rides to get to your destination, each one costing a few hundred or more cedis.

Then there are school fees. Even public schools charge students’ families for their services. About 40,000 cedis a month is needed per child.

We’ve still not added up clothing (often castoffs from people in rich countries), medical costs (the birth of a baby, without complications, costs at least one month’s wages), weddings and funerals.

Add all this up and you will find that the average couple with two children needs at least two million cedis a month just to survive at a minimal level. Two adults working full time earn an average of only one fifth that (an amount that is still taxable). So where does the other 80 percent come from?

Food is the greatest single expense. Some people can grow a great deal of their own food on ancestral land. But increasing urbanization has removed that option for many.

Corruption is rife. Seemingly everybody wants a “dash”—a little extra payment—for doing his work. You can’t even get your own money out of the bank without tipping the teller. People in service industries all live off their tips. Foreign residents and visitors in particular are expected to be generous.

Many families have a close relative who emigrated to richer lands and is expected to send money on a regular basis to help his family back home. Some overseas relatives will even send back a car or some other expensive item so a family can start a business. Still, many people go hungry when their $25 monthly average runs out, and many have to share accommodations with others.

What can we do to help?

Understandably appalled at such poverty, many people in the West want to do something about it. Often misguidedly thinking that government programs have solved their own domestic inequities, they believe that giving money to other countries will solve theirs.

Foreign aid has been described as money taken from poor people in rich countries and given to rich people in poor countries. There is a great deal of truth in this. In rich countries some of the wealthiest people often escape taxes through loopholes in the tax system aided by offshore bank accounts, leaving the burden of taxation on others. In poor countries the officials who run the country are the ones who receive the foreign aid, which they are then supposed to disburse to those most in need.

This rarely happens. This writer is not the only one who has paid exorbitant amounts for food items with the inscription clearly written on the side “A GIFT FROM THE PEOPLE OF THE UNITED STATES OF AMERICA. NOT TO BE SOLD.”

The book of Proverbs has these cautionary words for people who take advantage of the poor to increase their own wealth: “He that oppresses the poor to increase his riches, and he that gives to the rich shall surely come to want” (Proverbs 22:16 Proverbs 22:16He that oppresses the poor to increase his riches, and he that gives to the rich, shall surely come to want.
American King James Version×
).

This ancient warning has proved true countless times in Africa as corrupt officials enrich themselves at the expense of the poor, only to be overthrown and killed later in a revolution or coup. In 1979 some learned a bloody lesson when every previous Ghanaian president was killed after a revolution brought on by the increased gap between the haves and the have-nots.

Is debt forgiveness the answer?

Debt forgiveness is a currently popular concept. Many poor nations are heavily in debt to rich countries. They have to pay interest on top of the capital they owe. Although debt reduction could be helpful, we should realize that much of the debt was incurred by corrupt former leaders who stashed away the borrowed money in their own foreign bank accounts.

If such corruption were a problem only of the past, then it might make sense to cancel the debts and relieve the burden of heavy monthly payments. But, sadly, this isn’t the case. If anything, corruption is getting worse in many poor countries. Cancellation of debts would only lead to greater borrowing, with little or nothing achieved, the cycle simply repeating itself.

The G8 countries (the wealthiest seven nations in the world plus Russia) think they have a solution to this in the Highly Indebted Poor Countries (HIPC) initiative. The goal is to cancel so-called third-world debt but to ensure no further abuses. Money donated or lent will be for specific projects. Lenders will require proof that the money will go for the intended purpose. However, bureaucrats will have to do the verifying, which would surely lead to more corruption.

What about giving money through private charities? This is a better idea. Private operations do better at getting aid to people in need. Whereas an employee of a prominent Western governmental-aid organization admitted that 80 percent of the aid his country sent simply disappeared, one small church group claimed it loses only 5 percent. But charities are often hampered by governments that don’t seem interested in helping their own people.

Jesus said the poor would always be with us (John 12:8 John 12:8For the poor always you have with you; but me you have not always.
American King James Version×
). There will always be those who have less than we do. Also, poverty is relative. A book published this year noted that the minimum hourly wage needed just to pay for the basics in the United States is $8.89, yet nearly 30 percent of Americans earn less than that (Barbara Ehrenreich, Nickel and Dimed: On (Not) Getting By in Boom-Town America ).

When I pointed this out to a group of Ghanaians I work with, they agreed they could live quite comfortably on $8.89 per hour. With a legal minimum wage of only 5,500 cedis per day (that’s less than 80 cents per day) if a Ghanaian were to make $8.89 per hour he would be an aristocrat.

Reflecting on Christ’s words also makes us realize that poverty, traced to its roots, is caused by human nature, which is why we will not rid the world of poverty until human nature is changed. There would always be poverty, Christ said 2,000 years ago, because He knew that while man ruled himself without obedience to the laws of God there would be never-ending human suffering.

Nation’s potential not realized

Ghana hasn’t always been poor. Before independence, in 1957, Ghanaians enjoyed a per-capita income higher than that of some European countries. Great Britain gave the Gold Coast (Ghana’s former name) independence ahead of other African nations because it was richer and better educated than many of the others and because there seemed no reason this happy state of affairs could not continue. However, after Ghana gained independence, corruption and economic mismanagement proliferated. For 25 years the country continued a downward spiral from which it seemed impossible to free itself.

The last few years have seen some improvements, but much remains to be done.

The situation before independence illustrates that Ghana has the potential to take care of itself. No reason exists for people having to live in the appalling poverty that plagues so many. A few decades of good government that truly served the people could put the country back on its feet and enable ordinary citizens to live on their incomes.

Many people have confidence in the government of Ghana’s new president, John Kufour. They have high hopes that his administration will move the country forward. His first priority is to stabilize the nation’s currency. Ten years ago $1 bought 300 cedis; now it buys 7,000. This means that items that cost 300 cedis in 1991 now cost 7,000—an incredible rate of inflation for Ghanaians who do not have access to American dollars.

Priorities also include improving the infrastructure, encouraging foreign investment and stamping out corruption. Abolishing visa requirements would encourage tourists to visit this country, which is rich in African traditional culture and one of the friendliest places on earth.

For the sake of the people of Ghana, we hope these goals will be realized.

Christians who are aware of history know that mankind has never established a perfect government and that men have always treated their fellow human beings badly. Only the establishment of a completely different government—the Kingdom of God— will put an end to the misery that exists throughout the world. To this end Christ told His followers to pray for the arrival of that kingdom and that God’s “will be done on earth as it is in heaven” (Matthew 6:10 Matthew 6:10Your kingdom come, Your will be done in earth, as it is in heaven.
American King James Version×
).

The good news for Christians is that Jesus will return to establish God’s Kingdom on earth. One of His priorities will be to end the suffering and exploitation of the poor. The prophetic book of Isaiah tells us that “with justice he will judge the poor and defend the humble in the land with equity” (Isaiah 11:4 Isaiah 11:4But with righteousness shall he judge the poor, and reprove with equity for the meek of the earth: and he shall smite the earth: with the rod of his mouth, and with the breath of his lips shall he slay the wicked.
American King James Version×
, Revised English Bible). GN