Updated on 11.25.06

Review: Nickel and Dimed

Trent Hamm

Nickel and DimedSome of you who are reading this post right now are thinking “I’ve never heard of this book.” Others are probably thinking “Why on earth would this book be reviewed on a personal finance blog?” The best way to explain, I suppose, is by providing a brief overview of what this book is about.

Nickel and Dimed is a nonfiction work that you would typically not find in the personal finance section of a library or bookstore; instead, you’d have much better luck looking in the sociology or current affairs sections. It’s written by Barbara Ehrenreich, a widely reknowned author who has had regular columns in Time Magazine and The New York Times and had pieces in magazines of all stripes, from The Atlantic to Mother Jones. In short, she’s an excellent writer, though not an expert on any way in the matters of personal finance.

So what’s relevant about Nickel and Dimed, then? The book chronicles Barbara’s experience living as a low income hourly wage earner in the United States, working at jobs that pay six to seven dollars an hour and living a lifestyle that matches that income. A cynic might say she was “slumming it” for a book, but the book does succeed in one clear way: it is a well written account of what life is like near the poverty line.

Typically, I wouldn’t really consider a book about poverty in America to have much interest for personal finance readers, but this book has two things going for it. First, Ehrenreich has an impressive writing pedigree. Her skill with words brings to vibrant life what would be a very boring and bloodless story in the hands of most personal finance writers. If you doubt this, find it at your local bookstore, open it to any page, and read two pages. The people and situations she writes about jump to life.

Second (and perhaps more importantly), her experience teaches many useful lessons about the real meaning of what personal finance is and what frugality is. Most of us think that personal finance means maxing out our Roth IRA and that frugality means buying the generic bow-tie pasta at the grocery store, but the fact of the matter is that if you’re reading The Simple Dollar, you’re probably not eating beans out of a can and hoping that the heat isn’t turned off. There are a lot of lessons that can be learned from that way of life; I have a lot of memories from my childhood of poverty, but I could not hope to write about them as eloquently as Ms. Ehrenreich.

A Detailed Look At Nickel and Dimed

Over the course of this book, Ehrenreich moves to three different cities in the United States to experience poverty and working conditions in those cities; let’s look at each one.

Serving in Florida

During the first leg of the book, Barbara spends a month working as a waitress at two different restaurants in Key West, Florida. The experience of waitressing from Barbara’s eyes amounted to a lot of work for not much pay; the places she worked at targeted working class, student, and lower middle class diners, meaning that the tips were low and some of the patrons were quite demanding.

The most obvious principle that is exposed here is that education is the most valuable investment you can make in yourself. Most of Barbara’s coworkers had made choices in their lives that had excluded educational opportunities – they weren’t the “desperate single mother trying to make ends meet” type at all. Often, her coworkers were single who simply chose not to even try to better themselves; the high points of their existence were merely to have shelter from the rain, enough food to eat, and the opportunity to “party.”

At first, this seems like a self-motivation issue – they’re not bothering to better themselves. However, most of the other people in the book simply do not see further education as an option. They’re perfectly happy to keep running the treadmill that is their lives and, for the most part, this makes them content on a daily basis.

What makes this even more worrisome is the fact that minimum wage is not a livable wage. Barbara’s coworkers often find themselves either working two jobs, living in housing provided by others, or living in their cars. There is simply not enough money to maintain housing in an urban setting while working forty hours a week at minimum wage (it is possible in rural settings, but even then it’s not easy).

This brings up a real question worth pondering for anyone in any income bracket: what is the value of a way of life? Is it worth working eighty hours a week merely to keep a roof over your head? Is it worth working that much to “get ahead,” no matter what your job is? What does your life amount to if you spend almost all of your time working or resting, with no time left to enjoy life? I work much more than forty hours a week, but much of that time is extremely flexible around the constraints of my life; if I had to work as much as I do within a constrained timeframe, it simply would not be worth the life experiences I would be giving up.

Scrubbing in Maine

In the second portion of Nickel and Dimed, Barbara takes a job in Maine as a maid, cleaning the homes of the affluent as an employee of a home cleaning service. The job is labor-intensive, doesn’t pay well, and is fraught with potential injury issues, but the job holds even more disconcerting elements.

The first red flag raised is the inherent distrust of the working class by the affluent. Many of the people who hire cleaning services are clearly distrustful and disdainful of the workers that actually provide this service to them. They leave obvious “traps” (such as money sitting out with video cameras trained on it) in order to catch dishonest employees and leave borderline crazy instructions for cleaning their property, but even when the workers show themselves up to the challenge by being honest and forthright in their duties, the homeowners still treat them with great disdain. This merely causes the workers to do nothing more than resent the affluent, which does little more than cause the workers to do suboptimal work in the house because of the way they were treated.

This begs the question: how should people treat service industry workers? I tend to tip well if a strong service is provided to me in a restaurant and I often show additional gratitude when other service providers (such as secretaries, janitors, and so forth) perform what I need them to with speed, quality, and accuracy. A simple show of appreciation goes a long way in cementing a strong relationship with people who provide services for you. For example, at my previous job I used to give the janitor a birthday gift and would (every once in a while) bring a leftover meal from home and give to him. In return, my office was impeccably cleaned almost every evening and the bathroom on my floor was always pristine, while other offices and restrooms were perfunctorily cleaned at best. The simple fact is that tipping and respect of service workers pays dividends.

Another aspect of this general problem is “injury of the spirit;” in other words, when the reward to excel is minimal, why bother trying to excel? One could argue that the feeling you get from a well-completed task is reward enough, but how does that apply to an individual making less than a liveable wage? For that matter, how does that really apply to anyone? The maids in this chapter are instructed to simply “make it look good,” and there is absolutely no incentive to them to do anything more than that, even though they realize that, for example, scrubbing floors with only a tiny bit of water doesn’t actually clean the floor.

The lesson of this section is that you should reward service workers when they provide a regular service for you. If you have a home cleaner, leave that person a tip or a gift once in a while; if a secretary at work constantly solves your problems, leave a flower (or a similar gift) and a card for them. The service industry is often underpaid for the work they do, and showing them that you appreciate and value their work can do nothing but make your own life easier and better.

Selling in Minnesota

This portion of the book finds Barbara in Minneapolis, working at a Wal-Mart in the women’s clothing section. I found this section the least enjoyable in the book, because the class biases that Barbara largely kept in check here come shining through over and over again.

As I’ve mentioned before, there is a link between one’s personal appearance and one’s financial situation. I’m not talking about the need to wear a $2,000 pair of jeans; I’m referring more to the mere appearance of cleanliness and appropriate decorum in public. Barbara spends much of her time in this chapter commenting on the fact that many of the inexpensive clothing items at Wal-Mart are cheaply made and designed to (poorly) fit overweight people.

She even comments on the real cause of this, that inexpensive food is often loaded with empty calories and that there is a direct connection between food cost and nutritional quality. An individual must choose a point on this spectrum that they’re comfortable with, but the fact of the matter is that many people’s choices on this spectrum are limited by a severe cap on the cost.

She’s also critical of the behavior of the working class, commenting on the fact that many working class people allow their children to run amok in Wal-Mart, but here she’s quick to realize that this has a root cause, too: many working class people, especially those with children, have little or no time in which they’re not working, either at their employment or at the task of managing children, and Wal-Mart offers something of a respite from this drudgery. In short, the working class often uses Wal-Mart as a place to escape, if only for a little while, and not feel as though they are looked down upon. Where do you go to escape? I generally don’t go to Wal-Mart, but I do recognize that everyone needs an escape from the drudgery of life on occasion.

I guess I was disappointed by Barbara in that she allowed her upper-crust values to slip out here and blur her perspective on the Wal-Mart shoppers. The simple fact of the matter is that classism exists in America and the author of this book, even though she means well, is as guilty of this bias as anyone else.

Buy or Don’t Buy?

For most of this book, I was enthralled; it made me consider personal financial situations in ways that I really hadn’t before. The struggle that is working for less than a living wage is impressive and spending any amount of time really considering those who find themselves working for that wage to provide services to others is a really humbling experience.

At the end of the book, though, the same old class biases were exposed. Even when Ehrenreich would point out the root causes of some class-distinguishing situations, she falls back on general insults of physical appearance. The fact of the matter is that much of the food available to low-income people is loaded with empty calories, causing a high rate of obesity among the working class, and physical appearance is less important than food in your belly and a roof over your head.

The fact that this book even addresses real questions like the comparative value of shelter and food and health makes it a strong read, but the biases of the author somehow cheapen the whole thing. This book wants to make a difference, it seems, but it often just preys upon upper middle class liberal guilt about classism while maintaining that very same classism.

In short, buy this book as a gift for a literary friend. It’s very well written and will make them think about basic personal financial questions like those above. If the book sounds interesting, you might want to check it out at the library, but otherwise, this book is a pass – it starts off well, but then shoots itself in the foot by just sticking with the same old biases.

I originally reviewed Nickel and Dimed in five parts, which you may view here, here, here, here, and here if you’d like to read the original comments.

Nickel and Dimed is the third of fifty-two books in The Simple Dollar’s series 52 Personal Finance Books in 52 Weeks.

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  1. MGS says:

    It was very helpful for my research paper!!

  2. Paul Strauss says:

    This book is completely useless as a book on personal finance unless, as you weakly eluded to a reader needs a kind of “scared straight” because they don’t already know you can’t build a comfortable middle class lifestyle with no education, and/or ambition beyond clerking and waiting tables.

    I’ll grant you it was well written– good thing, too. It was far more useful as poetry than financial insight.

    It grated on me, too, because the author nearly completely focuses on people trying to live life working one or more low paying, low skill jobs. Like someone once said- life’s tough, but it’s tougher if you’re stupid. The author treads very lightly on the consequences of poor choices and seems focuses heavily on blaming ‘the system’ aka the shining becon of economic success that is America. Yes, there are flaws, but on the whole individuals in this country are largely responsible for their own success, or failure.

    Paul Strauss
    Founder & President, Windy City Round Table

  3. Jennifer says:

    I loved reading this book and found it really interesting. How anyone could use this to help better understand financial strategies is beyond me. This is a commentary on society. The author approaches it from her life and rights about it with that lense. I don’t think she should be faulted for her conclusions.

  4. Jenny says:

    I just read this review when you posted a link in today’s review about “The Overspend American”. I am really surprised you wanted to see some personal finance lessons in this book. This book is about how she navigated the world in the low-wage labor market, a social commentary mostly about the way the system stacks the odds against the very poor. I just don’t think it is very fair to review it as a personal finance book.

    I personally did not like the book very much at all, either. I think there are much better books about poverty and the low-wage labor market.

  5. Mrs. Micah says:

    I think after reading it I treated service people–whether at stores or cleaners–better. Because making ends meet is hard enough without having to deal with rude people. This includes being friendly with the cleaners’ if they’re at my parents when I visit. My mom gets cleaning done twice a month because she has terminal cancer and often doesn’t have enough energy for the bigger jobs. And my dad works all day. She’s quite nice to them as well, treats them like real people.

  6. Katy says:

    Everyone deserves courteous and respect.

    >>the places she worked at targeted working class, student, and lower middle class diners, meaning that the tips were low and some of the patrons were quite demanding.

  7. Katy says:

    And secretaries don’t need flowers, they need money. How about a gift card?

  8. Michael says:

    I read this in high school like I think another poster commented. Here is my opinion: I think The Simple Dollar missed the inherent value of this book as a financial tool and Barbara Ehrenriech missed it too. Anyone can save money because even the poor mentioned in the book spend LOTS of money. They do live pay check to pay check, but as she said, they still party.
    Also most of the “crisis” in the book could be solved if the workers saved even a small amount for little emergencies. Those two ideas are the values inherent in the book.

  9. Ginny says:

    I worked for “the welfare” in two states, for many years, and as a result I have a great deal of familiarity with the lives of people who work for minimum wage. Also, I was a waitress and a shoe clerk before I went to college and later grad school, and half of my ancestors were very poor. The person who commented, oh so smugly, that these people are “stupid” and their circumstances are altogether the result of “poor choices,”is either very young or very ignorant or both.

  10. Betty Ann of New York City says:

    Hi. I read this books years ago. I loved it. It opens your eyes to how rough some have it (not fair at all). They work so hard and are generally be using by society.
    I read last month Down and Out in Paris and London by George Orwell (an autobiography memoir of his life). I got it used in a book store (so good for the Environment too). Being frugal helps with the Environment.. have you written any articles on that? I have to look and see. Your Blog is terrific.. TERRIFIC. I need to save money for retirement and need motivation to becoming even more Frugal than I am.. (not cheap.. but Frugal).
    Betty Ann

  11. Carrick says:

    I would definitely say that this book does not merit a pass, but is rather a MUST READ–especially for middle-to-upper class people who have never had to make pennies doing such back-breaking labor for a living. It at the very least will give them the perspective of how “the other half lives”, which I think is a crucial perspective when going into the voting booth….

  12. Mike says:

    Trent, this book is often required reading for students at ODU here in Virginia. However the book is being used while teaching the students with a under pinning of why socialism is better in America. I’ve been very upset and in disgust since then with this book and those in academia who are using it to make those connections.

  13. Melissa says:

    While I make a comfortable living now (I know that’s relative), I spent eight years cleaning houses for the wealthy in Scottsdale and Paradise Valley, AZ in the 90’s. What I learned, while wading around on stranger’s bathroom floors on my hands and knees was this: the “wealthy” people I cleaned house for were “wealthy” because they worked hard. Not one of the hundreds of “rich” people I worked for over the eight years had inherited their money- I asked! They were all extremely frugal and hardworking (even in retirement) and SMART. Sure, there were a couple who were odd or eccentric, and one or two over the entire eight years were actual “jerks”… but the VAST majority were incredibly KIND and generous people. I treated them, and their homes, with absolute respect, worked hard physically, and showed up reliably, and delivered what I promised; in return, they always paid me what I asked (about $25/hour in the ’90’s), returned the same amount of respect I showed them, and in some cases were incredibly generous with gifts at holiday times. They were all devestated when I decided I’d had enough of slinging vacuums in and out of my car in 112 degree heat, and went to work in an office. Come to think of it, ten years later I’m really not making a whole lot more money now, just doing it with my mind instead of manually laboring. We all make our choices. Classism, whether perpetrated by the wealthy (looking down at WalMart-ians) or by the poor (resenting ‘the rich’ when they should be emulating their frugality and work ethic) is a ridiculous waste of time and is literally tearing our society apart, and Ehrenreich’s classism (and her own guilty rich-liberal bias) is showing- big time.

  14. PChan says:

    Trent, I just wanted to point out that Erenreich didn’t grow up middle class or upper middle class.

    As far as your perceptions on the book, well, we definitely disagree. I don’t think she was playing on upper-class and middle-class guilt; I think she was point out an issue that is (unfortunately, still) invisible to many people.

    @Michael–the people in the book spent a lot of money, but not because they “partied,” it actually costs a lot more to be poor. No first, last, and security? Then a more expensive weekly rental for you! And this rental is nowhere near a decent grocery store and/or there is no fridge/freezer space for food, so yes, there’s money spent on convenience food.

    Given the fact that she was writing about the effects of welfare reform (and a lot of people who need public assistance have kids), the situation gets untenable.

    @Ginny–ITA. I’m pretty frugal, but I still tire of the special snowflakeness of people who bleat about how they made such great choices and therefore, everyone who is poor obviously deserves it. How’s the weather up there on privilege mountain, people? Jeez.

  15. Amy says:

    Obviously, a book review can’t cover everything (nor should it). But I think there are a couple of things I remember from reading this years ago that I think are important. One is that Walmart keeps most of its employees on part-time work = no real medical benefits. All it takes is one broken arm to rack up thousands in medical bills. So that is something caused by “the system”, not by the person’s choice. That person might have diligently been saving up an emergency fund — boom, it’s gone.

    I seem to also remember something in the section about waitressing where Ehrenreich kept applying for hotel room-cleaning jobs but being steered towards the waitressing because she is white and speaks unaccented English. I don’t recall whether the $ was better in waitressing or cleaning hotel rooms, but it was still interesting to note the “steering” of certain demographics towards specific jobs, even when they expressed interest in other jobs.

    I tend to think these issues are never black and white. I think there are plenty of people at or below poverty level who are there because of bad choices, and plenty more there because of bad luck, or flaws in “the system.”

  16. deRuiter says:

    Of course the potential employers steered a well spoken woman who looked normal towards waitressing. What would be the point of hiring a person with good grammar and people skills to clean toilets while putting a person with a poor appearance, bad grammar and no people skills on the floor of the restaurant? Duh… employers WANT to hire people for job openings where there is a good fit for the job and the person WILL BE ABLE TO DO THE JOB FOR THE EMPLOYER WHICH NEEDS DOING. The private sector isn’t social services. “The Poor” need to think of this when job hunting. “The poor” in America are mostly poor because of bad choices. How else to see all the immigrans pouring in, unable to speak the language, don’t know the customs, AND THEY OPEN A BUSINESS IN A YEAR? The immigrants make good choices, they work hard, they don’t waste money. I notice that native Africans who come here and drive taxis, open small businesses, look down on the American welfare class because the don’t take advantage of the opportunities offered to anyone willing to work hard. If you work for minimum wage in America, you’re either young, part time, or stupid. GET SOME TRAINING, STOP MOANING, CLEAN YOURSELF UP AND GET A BETTER JOB.

  17. Rimaye says:

    deRuiter says, “If you work for minimum wage in America, you’re either young, part time, or stupid.”

    I will ignore how incredibly insulting this is to millions of minimum-wage earners, and simply point out that it’s hard to call someone “stupid” when their opportunities for education are sub-par. It’s evident from your comment that you didn’t read the book (or you would know Ehrenreich wasn’t “steered” towards waitressing, she applied for the position), but I would recommend that you read it, and also Jonathan Kozol’s “Savage Inequalities”, to get a better impression of what the choices facing poor Americans are really like.

    People have choices, but those choices are often highly constrained. Some immigrants do exceptionally well, but many – more than those immigrant success stories recognize – do not (another book that deals with the “model minority/immigrant” myth is Frank Wu’s “Yellow). Those that succeed often do so because they are already well-educated and have a large support network, which isn’t the case for many poor native-born Americans.

    In general, I would suggest that you refrain from condemning an entire group of people without detailed knowledge of their situation, either first-hand or from research. It makes you look not only callous, but ignorant – something you accuse working-poor Americans of being (although you used a far more insulting word). I’d like to see how easily you would be able to get some training and get a better job if you were working 80 hours a week (with hours that changed routinely) just to barely scrape by.

  18. Alexa78 says:

    As an assignment, I read and reviewed this book. I believe that Ehrenreich didnt actually live like those who lower class and poor. Yes, she experienced a taste of it, but did she get the full experience? Not in my opinion. I believe that she quit when it got tough, instead of staying and really working through it liek those in lower class do. Personally, the book was not all that bad. It was not very ‘real’ to me, but it did help me understand more about lower class and what its like on (not) getting by in America.

  19. Teresa says:

    Why the government keeps subsidising businesses that pay such low wages is beyond me. The social service deptartment wouldn’t be near as busy if the minimum wage would be at a liveable level. The people that make those decisions should try living on that much and see how many like living with that bank account! I would love to see something wrote on the fact that the working poor are only that way because business owners choose to pay their employees unliveable wages! All income brackets need to understand that the US would shut down without people to do all the “low-income” jobs that no one else wants to. So good or bad this book brings to light issues that need to be addressed.

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