I'm Lovin' It! A Menschly Take on McDonald's Budgeting - Live Like a Mensch
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I'm Lovin' It! A Menschly Take on McDonald's Budgeting

"Have a seat! Let's talk budgets."


By now, you've probably read about the brouhaha surrounding McDonald's newly published Practical Money Skill Budget Journal. This seemingly well-intentioned educational attempt has been making many people very angry. Specifically because of the following sample budget:

I won't go into all of the details of what people are objecting to in this budget, but suffice it to say, there is concern over the fact that this sample budget assumes a worker must either be carrying two nearly full-time jobs, or this is a family budget (which explains the two jobs) that does not account for childcare or other child-related expenses. In addition, the $20 amount for health insurance, and the lack of a line-item in the budget for food, gasoline, or clothing, are both pretty troubling.

But, as Mother Jones (which was just about the last media outlet I expected to take this tack) puts it, Let's Give McDonald's a Break. (McD's, like the rest of us, deserves a break today).

Educating employees--particularly those employees who are working at minimum-wages--on how to successfully budget is a noble goal. Budgeting is one of those skills that is undertaught, both by parents and our educational system. But learning how to create, tweak, stick to, and improve a budget is something that can mean the difference between getting ahead and falling thorugh the cracks.

No, I don't think the problem is with McDonald's--although I do wish they could have used more realistic numbers. (The original version I saw listed $0 for heating but no corresponding higher cost for electricity, which is what you would see in areas where heat is not necessary but A/C most definitely is). I also wish there was more of a discussion about how it's nearly impossible for an individual earning minimum wage to get by on only one job.

But ultimately, those are not issues with McDonald's. This large corporation, which I truly believe is in an excellent position to do a great deal of good because of its immense size, is honestly trying to provide its employees with an important and under-taught life skill. Good for McDonald's, and good for any employees who are able to take something from this program.

Criticizing McDonald's in this case (although I do feel some of it is deserved) does smack a little bit of refusing to accept anyting less than perfection.

I saw a clear example of this when I was a young voter. At the time, I made the mistake of telling someone that I didn't like either candidate for president that year, but that I felt I absolutely had to vote against one candidate. My listener told me I was making a horrible mistake by doing that, because I should be voting for someone, not against someone, and I should therefore go to the polls and just pick no one for president. My listener was an incredible idealist, thinking I should reserve my vote for someone worthy of it. I am very practical and feel I need to work within the constraints and choices made available to me, because making no vote helps no one.

You'll also see this type of criticism anytime you start a slow, life-changing regimen. "Oh, you're drinking water with your double-bacon cheesburger? Like that's going to do anything!" Well, yes, actually, it will. Trying to switch to water and salad and runnning five miles daily and cutting out all sugar, etc, is unsustainable if you do it all at once. Making little mindful changes is much more likely to make a difference in the long run.

And I feel like that's what McDonald's is doing. An enormous corporation is attempting to fill in an educational gap in its employees' lives. It's definitely not perfect, but it's a start. And it could lead to incremental changes.

Also, by creating this budgeting journal, Mickey D's has gotten a lot of people talking about both personal finance/budgeting in general and how difficult it is to live on minimum wage in particular. That is most certainly a good thing. We need to have these discussions.

I've never had to live on minimum wage, but my first job out of college in 2001 was working 40 hours a week at Barnes & Noble for $8.25 per hour. My take home pay was $1000 per month. I paid $505 a month in rent, and about $150 per month in groceries and food. I was paying $200 per month in student loans. That left me $145 per month for my other bills, gasoline, savings, and fun money. Thankfully, my car was paid for, and my parents were still helping me out with auto insurance. Barnes & Noble took out my portion of the employee health insurance premium before I saw my paycheck, so I didn't have to think about it. Even though I tried to put away $60 per month in savings, I was generally able to make ends meet, although I took more loans from the Bank of Mom and Dad than I (or they) would have liked.

Even so, I consistently tried to find a second job that would fit within my irregular retail schedule, or a better-paying main job. But without the support of my parents, or the education I already had, I could have been stuck in a very bad financial situation for quite some time. And this was 12 years ago.

If Barnes & Noble had produced a similar budgeting journal for its employees back then, I might have been a little offended by some of the assumptions the sample budget made. (And I don't blame any McDonald's employee for bristling at those assumptions.) But I think think it's a mistake to get caught up in those offensive assumptions the detriment of the big picture. Instead, let's focus on the good that this can potentially do.

Here's hoping that it can lead to some important insights about finances on the individual through to the national level.

Ronald McDonald image courtesy of M.Minderhoud

Sample budget image source



frugal_fun said:

It probably also created a bruh-ha-ha because it's McDonald's and it's pretty fashionable to be against the chain. Probably nobody would have cared if Burger King or Wendys did something like that. (Although maybe Chick-Fil-A)

I worked at McDonald's in high school for about 3 years. At one point seriously considered a career there. I never hesitate to eat there and it's my understanding that the franchise owners are some the most diverse bunch (women and minorities) of any corporation. In addition, all McDonald's sponsor Ronald McDonald's houses and centers for the parents/family of seriously ill children while they receive medical care. All services are provided free to the families.

I used a Ronald McDonald's center last year when my infant daughter was in the hospital for a week for surgery.  (She's okay -it was preventive measure to create a permanent fix for a congenital defect.) It was really a wonderful place that gave the adults a quiet refuge from the stresses of dealing with a sick child and hospital life. Once, while I was in taking a break myself, a volunteer was lending an ear to a woman who was trying to cope with her child's terminal illness.

I have not used the lodging but I can only imagine the relief it must be to not have worry about paying for a cold hotel. McDonald's doesn't really seem to get credit for all that work. :(

" "Oh, you're drinking water with your double-bacon cheesburger? Like that's going to do anything!" Well, yes, actually, it will. Trying to switch to water and salad and runnning five miles daily and cutting out all sugar, etc, is unsustainable if you do it all at once. "

Totally agreed, although I will quibble that all of these things together are not optimal in the quest to keep body fat to a minimum. Cutting out the sugar will have the most effect, attempting to eat like a rabbit and running 5 miles daily will have the least.

Ironically, when I do eat at McDonald's, I have water or iced tea, a burger without the bun (included the dreaded double bacon cheeseburger) and not much else. I will have a side salad if I feel like it. There never was a proven connection between saturated fat intake and heart disease, so I don't worry about that side of it. The processed side is not ideal, though and so we try not to visit often. It makes much more sense for us to have a burger at home.

July 19, 2013 10:43 AM

frugal_fun said:

""I also wish there was more of a discussion about how it's nearly impossible for an individual earning minimum wage to get by on only one job."

Sure, let's discuss it. The only ideas I've ever seen seem to involve making employers pay more. It doesn't solve any problems. Raising the minimum wage beyond what the market will bear only shuts people out of work. The economics absolutely have to work, otherwise employers shut down businesses or never start them at all.

My father was one of those "evil" employers who could only pay minimum wage with no benefits. He didn't pay that scale because he wanted to. He was painfully aware of how "on the edge" his employees were. He paid that amount because any other would cause the business to go into bankruptcy.  Before you say "hey, we didn't need that stupid business anyway", consider that he was running a well regarded group home for adults with developmental disabilities.

One the of main problems with your personal experience on minimum wage looks to be student loans. $200 a month would have gone a long, long way to improving your living conditions. I really wish that the student loan system could be scaled back. Hopefully most low income families are not dealing with the albatross of student loans.

The other thing to consider about your experience is that you were working a slice of corporate America where they don't have trouble finding workers. Part of the reason they can pay minimum wage is because people like you love the idea of working in a bookstore. It's, well, kind of a cushy job -- that's why you wanted to work there, right?

With your same education, you could have gone to work as a manager trainee at McDonald's, probably at a higher rate of pay even as a trainee. (You only need an associates degree to advance beyond crew leader. Time off was always granted for school at the store I worked at.)

Once you make it to beyond crew leader, the pay is substantially better along with benefits. Anyone responsible and interested could make it through the ranks in my old store. In addition, McDonald's would also pay more for people willing to do "yucky" jobs - maintenance after hours, people who were wiling to learn to quickly pull apart and clean equipment, etc.

Any discussion of sustainable wages needs to include the idea that some jobs are actually worth more because the people doing them need to take on high levels of responsibility, discomfort etc. It's not fair to those who do work hard or ultimately even sustainable to wave a magic wand and make employers pay more than market rates for work.  I think it's a complex issue that needs to be addressed outside of the employment system.

July 19, 2013 11:00 AM

haverwench said:

"It's not fair to those who do work hard or ultimately even sustainable to wave a magic wand and make employers pay more than market rates for work.  I think it's a complex issue that needs to be addressed outside of the employment system."

Fine, but those who are opposed to raising the minimum wage are usually opposed to doing anything else to help low-level workers, as well. Single-payer health care, for instance. If we had a single-payer health insurance system, employers would have to pay taxes to support it, but they would no longer have to bear the brunt of providing and administering health insurance programs for their employees. Individuals would also have to pay taxes, but under a progressive taxation system, the burden on low-level workers would be reduced. Yet every time this idea has been proposed, it's been attacked as "socialism" and struck down before even getting off the ground--generally by the same people who are most violently opposed to any increase in the minimum wage.

Pretty much the only kind of aid to the working poor that Republicans generally talk favorably about is tax cuts. So they should love the Earned Income Tax Credit, right? It gives people an incentive to work, right? So why did Mitt Romney attack those who receive it as people "who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it"--rather than as workers who are being rewarded for working?

I'm really trying not to make this sound like an attack here, but I think that if you want to have a serious discussion about this issue, it's not enough to attack the ideas that you *don't* like, however intelligently; you also need to propose some meaningful alternatives.

July 21, 2013 3:19 PM

oddfox1 said:

My understanding the reason McDonald's did this, was to help their employees learn the mechanics of budgeting. Their efforts addressed a single issue, not all contingencies. The $750 "monthly spending money" would include food, gasoline, clothes, and other highly personal and variable expenses, including day care. Perhaps that's why it was lumped together. If you don't have kids you don't need day care, if you don't have a car you don't need gas, if you get all your clothes at a thrift store it will be mighty different than buying new, food prices are really variable too, it varies with the number of people, age, gender and type of food served. Itemized expenses look like they are pretty much the average nationwide. When $750 is broken down to $25 a day that helps people understand what it looks like in the short term. The budget is not meant to solve the world's problems or complete a discourse on minimum wage, but to help people think deliberately about their choices. I think McDonald's suceeded in their attempt, and wish I had been taught something like this.

July 24, 2013 6:22 PM

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