Having been poor (U.S. standard) during much of my elementary and middle school years, and then escaped to a relative level of upper middle class comfort...there is one defining characteristic between my peers from back then who made it out of that situation, and those who are still there decades later: a broken decision making process best and the inability to plan exemplified in the famous Marshmallow test.

http://en.wikipedia.org/wiki/Marshmallow_experiment

It brings to mind a very recent discussion I had with a close friend from those days, one who hasn't managed to break out of a cycle of being poor. He was telling me how excited he was about a new idea where he was going to enroll himself and and his 12 year old son into an expensive martial arts school for some father-son bonding time every week.

I remarked back, "but you barely make rent every month (and you split rent with 3 other adults in a relatively inexpensive area), your cell phone is routinely shut off for non-payment, your credit is so bad you can't even qualify for the highest interest lowest balance credit cards allowed by law, your cars are perpetually broken down/repossessed etc. you have a pending lawsuit for non-payment to a doctor because you couldn't pay your medical bills, etc. etc. etc. how on earth do you expect to pay for this? If I were you, I'd figure out how to resolve my financial situation first so that you can then do those kinds of father-son things you want at your leisure."

"Well how do I do that?"

"Instead of spending $250 a month on this, why don't you spend half as much and go to the local community college and finish up your associates (he's already finished a semester, so it was only another year, year and half left), translate that into a higher paying job or promotion or whatever, pay off your crap, buy Dad and Son Kung Fu?"

"Look, I only have a short window of opportunity here."

"What do you mean?"

"Well, the lease on the house me and 3 other adults split the rent on is up in 2 years, and because of my money issues I don't know if I can afford to stay living close to my son after that, I may have to move out of state to a cheaper area, I'm seriously considering the Detroit area since the cost of living is low. So I want to do this now, while I can."

This has been a typical conversation over the last 20 years with my friend. A decision point comes up, we'll talk about it, on one hand he'll have an opportunity to improve his lot in life, but he'll have to sacrifice a little now in order to reap rewards later, on the other hand, an emotionally satisfying marshmallow.

Invariable he'll always pick the marshmallow. He's interested in the immediate "feeling" of a decision, unable to project an expectation of a better "feeling" later on. The result is, 20 years later, an otherwise intelligent, honest, good guy nearing middle age has:

- no career progression of any sort, he's actually never worked a full-time job

- he's been fired many times from promising jobs because he was "bored" and pretended to be sick from a mystery illness until they let him go

- has a couple kids he can't support properly

- can't afford a place on his own with living arrangements so complex it would take 4 or 5 long blog posts to explain

- has had a handful of cars repossessed or sold off out of his control

- continues to buy known unreliable vehicles that require constant repair, costing him precious money and time away from work

- did a solid semester at college (with decentish grades) before dropping out because he didn't have enough time to play WoW - he was very proud of having finally cancelled his account...for the 3rd time.

- spends considerable portions of his income on videogames and online subscriptions

- buys random unnecessary crap all the time, "yes that RC helicopter is cool, why is your phone shut off again?"

- has innumerable small medical bills currently in collections, with one pending lawsuit (btw, the one he's getting sued for? Almost the exact cost of a WoW account for a year)

- etc.

Each of these issues can be explained by the Marshmallow test, because to properly deal with any of them requires the ability to defer gratification in the immediate as part of a plan, something, even with decades of coaching, he's unable to do, and thus remains poor.