Millions of Americans cannot afford a $400 emergency expense. Millions more live paycheck-to-paycheck. These are good, hard-working people. They pay their taxes, keep up on their bills, and do everything right - but at the end of the month, they're lucky if they have a positive balance in their bank account.
Then, one day, their kid breaks a leg. They get a parking ticket. Maybe their car breaks down. Whatever happens - that's it. That's when they've fallen over The Precipice, into poverty or homelessness, all over a few hundred dollars.
A few hundred dollars might not sound like a lot in the grand scheme of things, but for nearly half of Americans, it can mean that they don't make rent that month, or they can't afford to fix their car, or any number of life-changing crises. When what should be a minor hurdle occurs, more than half of Americans are at risk of losing their job, their home; everything.
Maybe they're "fortunate" enough to have credit cards or a payday loan service available to them... but interest and fees are just another expense that they already can't afford. These costs compound over time. They may use one line of credit to pay off another, until the fees are finally too much, and they begin to miss payments. Then it's only a matter of time. Say for example, that they use a payday loan this paycheck. Their next paycheck goes to paying it off, so they'll need another... And another... And if they could just barely get by before, they certainly can't afford the 390% - 780% APR that's charged for payday loans, so eventually they need to borrow more than they can pay back, just to pay off the previous loan plus fees and interest.
These good, hard-working, honest people, will become our nation's homeless population - unless we do something about it.
This isn't because they're lazy, or because they're dumb. It's not because they're bad people. They were simply unlucky. These people - the foundation upon which our society rests - need your help.
"The Precipice" is a term we use to describe the situation they find themselves in, just after something goes wrong and they're hit with an unexpected bill, but just before they fall over the edge and lose everything. This is the critical moment, in which a small amount of assistance can save not only a family's future, but your tax dollars, too! Just imagine how much of our taxpayer-dollars, not to mention dignity and livelihood, could be saved if homelessness could be prevented rather than forcing people to rely on social programs for food and shelter while also trying to get back on their feet. The Precipice Foundation (a 501(c)(3) non-profit charity) steps in to help at this critical moment.
The goal of The Precipice Foundation is to step in at the critical moment, and help these families and individuals make their way back from the financial edge. Here are some of the options we explore in each case:
Consider the cost of bringing someone out of poverty or homelessness once they've already gone over the precipice, and compare that with the cost of keeping them from going over in the first place! By investing in our neighbors before they've gone over the precipice, we can make much more effective use of your donation!
You may be surprised at just how little it can cost to help a family find their feet in a financial crisis. The fact is that 4 out of 5 Americans live paycheck-to-paycheck, and 44% of Americans cannot afford a $400 emergency expense. For these 44%, a few hundred dollars can be the difference between stability, and homelessness.
While it's impossible to ascribe a monetary value a person's life, livelihood, or dignity, homelessness has a quantifiable monetary cost to society, and to individual taxpayers. Once an individual becomes homeless, they can cost taxpayers between $30,000 and $36,000 each year. Overall, homelessness costs American taxpayers almost $11 billion each year. Meanwhile, the cost to prevent homelessness can be a few hundred dollars; and in some cases even less, as assistance can come in the form of training, budgeting tools and assistance, and connecting people on the precipice with existing opportunities to make a better, more stable life for themselves.
Although it's painful to acknowledge, we recognize that we can't solve the problem of homelessness over-night, and we can't help every single person who needs it. As such, for every unique case we work on, we try to calculate the amount of "net good-per-dollar" that we can do. This kind of moral calculus can be distasteful, but we do our best to allocate resources where they'll do the most good. We feel as though we owe it to our donors, to ensure that every dollar they contribute does as much good as it possibly can.
After discussing a potential recipient's situation in detail, we try to determine things like:
We consider these and many other factors, when determining who we can help, and how best to allocate our resources.