This is Carina. She’s my best friend (which probably says a lot about my life). This week I thought she was going to die, and it cost me $700 to make her better.

That was $700 I didn’t really have – but of course I was going to do everything I could to find it. It’s easy enough to say ‘put something away for a rainy day.’ For those of us on a low income – be it minimum wage, a benefit, or student living – it’s not that simple. When we say there’s nothing in the bank, we don’t just mean we can’t go for coffee this week. We mean there’s nothing in the bank.

Carina came into my life after a pretty rocky start, so I guess we suited each other. I was volunteering at the Wellington Cats’ Protection League. She was abandoned and ended up there. I was told to “keep her in isolation, because she opens other cats’ cages and tries to start a revolution.”

I took her home that day.

Some people say that beneficiaries should not have pets. That pets are a luxury and a liability.

Yes, they are. Owning a pet is a privilege, and, unless they’re a pedigree, probably not an asset. If they’re anything like Carina, they’re an endless sinkhole of Fancy Feast and freezedried catnip.

And I budget for that, because, like I said, she’s my best friend. It’s pretty well documented that companion animals are damn good for sick people, and she’s been constantly by my side in the last two years. On bad days, she stays on the couch with me. On good days, she “helps” me write by sitting on the keyboard and licking my face.

So what happens when a bill like this drops in your lap, and you’re living on the poverty line? – Poverty being defined as  ‘households earning below 60 per cent of the national median income after housing costs.’ (Here’s some Feb 2014 statistics).

New Zealand’s high level of inequality is no secret. Max Rashbrooke is doing an amazing job of keeping that conversation going.

• From the mid-1980s to the mid-2000s, the gap between the rich and the rest widened faster in New Zealand than in any other wealthy country
• In the last 30 years, incomes for people at the top have doubled, while those at the lowest end have barely increased
• The average household in the top 10 per cent of New Zealand now has nine times the income of one in the bottom 10 per cent

and:

• The top 1 per cent of adults own three times as much of the country’s wealth as the entire lower half put together.

So. Say me, and probably most of the people I know, are knocking around in that bottom 10 per cent.

And suddenly: your pet needs the vet. Your car, which you need to get to work or run your kids to school, breaks down. You get a big power bill because you’ve been trying not to freeze in your poorly insulated flat that has no rental Warrant of Fitness required. You have a big doctor’s bill because you’ve been freezing in your poorly insulated flat has no rental Warrant of Fitness required.

There’s only so much you can plan for. And even if you can plan for it – how much can you realistically save from the income you’re using to get by?

• A student loan is round $175 per week.
• The average student allowance is round $215 a week.
• If you’re working fulltime on minimum wage, you’d be getting round $480 a week.
• As a single, childless person over 25 on a Jobseeker benefit, you could be getting around $210 a week (before an accommodation supplement or disability allowance, if you qualify for those. There’s a lot of caveats.)

Living costs can be difficult to calculate as an average – but they certainly don’t match up to the above. I checked out the Reserve Bank inflation calculator to try and weigh the rise in costs against the increase of the benefit/student support/wage. It says that: A basket of goods and services that cost $1.00 in quarter 1 of 2000 – costs $1.42 in quarter 2 of 2014.

My regular living costs include: rent, medical bills, groceries, transport (fuel, buses, donations to the Red Cross Van), power bills, water bills, internet bills, phone bills, Carina of course, clothing (very occasionally), and the usual household items.

Let’s look at some of these.

Power price increases: Since 2000, electricity prices have risen by 46% in real terms. (ConsumerNZ)

Rent/mortgage increases: This Rent Or Buy report from Interest.co.nz is really interesting.

“It takes 24.2% of household take-home pay to make the median rent on a 3 bedroom house.

That means in August 2014, it takes 7.8% more of your household income to afford the mortgage than to rent. Of course, this assumes you have saved the deposit to afford a mortgage, and that may well be another big barrier for many.”

Food price increases: “…in the year to June, food prices increased 1.2%, resulting in the highest price since July 2011. In June, vegetable prices increased 8.9%. Meat, poultry and fish prices increased 3.6% – the largest monthly rise since July 2011.” Source.

Fuel price increases: Rising, with more increases planned.

In comparison to all of this: my benefit has gone from $206.21 (July 2013) to $209.06 (April 2014). $2.85 more! Yay! 

Even if I could save on this income, anything over a few hundred (I couldn’t find out exactly how much, I seem to remember it being round $800 but I might be wrong) is considered a ‘cash asset.’ That means you’re supposed to use it for immediate costs, rather than hold onto it, and your benefit can be removed or deducted because of it.

Low income. No savings. Bills happen. What do you do?

WINZ has a few answers. Sometimes you can get an emergency grant, which you usually have to pay back. Sometimes you can get an advance on next week’s benefit. Either way you end up indebted to WINZ and your benefit usually gets reduced by the repayments.

You can enter into independent loan agreements. Sign hire purchases. It’s that sort of debt that contributes to the ever-growing divide between the bottom 10% and the top 1.

And it seems to be encouraged. Loan sharks are everywhere. Every TV ad break promises instant finance, no strings attached.

I don’t blame or judge people for taking that option. Sometimes it’s the only one left. I’ve only ever had one HP and honestly it scared the crap out of me. I paid my student loan off before time because I felt it weighing on me constantly, and I was in the privileged position then to be able to do so.

Since I got sick, things are different. I’ve had to accept grocery vouchers from friends. I’ve had to go to my parents and raid their cupboards. I’ve had to rely on the generosity of my community, especially Twitter, something which has been incredibly difficult for me.

Luckily, WINZ allows once-only gifts, so benefits don’t get deducted because of this.

A solution such as a Universal Basic Income might go some way towards helping. Other initiatives like the Kiwibank Sustainable Business Network are doing good work through things like microfinancing. It’s not enough. It’s not now.

Let’s go back. Your children need medication. Your pet needs the vet. Your car breaks down. You get a big power bill because you’ve been trying not to freeze in your poorly insulated flat that costs you almost a quarter of your income (note – this seems a low estimate to me, mine is more than that)?

Vegetables up by 8.9%? People can’t buy healthy food. Medical costs increase. Families live in poverty conditions. You can’t anticipate, you can’t save? You get those sudden bills – you sign up for another loan. What else can do you do?

It’s just one example. Carina is just one example. I am just one example.

I don’t have an answer. I just think we need to talk about it.