Laura Shin

Laura Shin, Contributor

I write about personal finance, business and the economy.

Personal Finance
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7/18/2013 @ 12:01PM |187,168 views

Why McDonald's Employee Budget Has Everyone Up In Arms

As the saying goes, everyone should have a budget.

No matter how much or how little you make, a budget will help you reach your financial goals, right?

Possibly with that idea in mind, McDonald's McDonald's decided to teach its employees how to create one. But in doing so, the company may have inadvertently done something else: Shown that it’s nearly impossible to make a living off the minimum wage.

RELATED: Will The McDonald’s Employee Budget Help Get The Minimum Wage Raised?

Take a look at the sample budget, provided in a Web site that McDonald’s created in conjunction with Visa Visa. Here are some of the main criticisms of it:

  • It assumes the worker is working two jobs.
  • It surmises that health insurance costs $20 a month.
  • It doesn’t include child care, groceries, clothing or gas for the worker’s car.
  • Also, another, possibly earlier, version of the budget (seen here) proposed that heating would cost $0 a month.

The health insurance line item may be the most absurd. As this video points out — is that $20 for Bandaids and nine aspirin a month? The average national health insurance premium for an individual is $215 per month. As far back as 2010, even McDonald’s own plan for its workers cost $14 a week, according to The Wall Street Journal.

Also, that missing gas expense? In 2012, the average American family spent almost $250 a month on gasoline, according to the U.S. Energy Information Administration.

RELATED: How She Lives On Minimum Wage: One McDonald’s Worker’s Budget

To McDonald’s credit, other parts of the budget are more realistic.

While the rent is well below the national average of $1,062 per month, according to a recent report by Reis, it is possible in many parts of the country to find housing for $600 a month. And the monthly phone bill can run $100. Plus, let’s applaud the fact that they encourage the employee to develop savings.

Despite its good intentions, when comes down to it, McDonald’s, by positing two jobs for this fictional worker, has tacitly admitted that its employees can’t live off the wages it pays.

McDonald’s told ThinkProgress, “The samples that are on this site are generic examples … intended to help provide a general outline of what an individual budget may look like.”

Unfortunately, it doesn’t look like people are buying it.

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  • rt_trask rt_trask 1 day ago

    I’m not up in arms. The sample budget may be poorly conceived, inaccurately reflect some expenses, and omit others but so what?
    It provides a template to account for income and expenses. Use it …
    You can’t live on the income from a job at McD? Again, so what?
    Many of us have worked at McD (and their competitors). The money helped us through school on our way to better things.

    Instead of getting exercised about this maybe McD critics should put their energy into telling everyone (sic), “It’s your responsibility to acquire marketable skills so that you can support yourself and your family. Here’s a worksheet to help you understand the stark realities of NOT having marketable skills.”

    Nope. That’s too easy. Better to whine about McD not paying the mythical “living wage”!

  • How unselfish and caring of you.

  • ninerfinn ninerfinn 1 day ago

    I agree with you. People should realize that a person could not live off minimum wage. Minimum wage was not meant for a person to make a living from, just a starting point. If people cannot find the need to better themselves to get out of a minimum wage job, then to bad for them.
    By the way, I worked at McDonalds at minimum wage and after working there for about 6 months I got a pay raise because I actually showed up to work on time and worked.

  • ninerfinn ninerfinn 1 day ago

    He is not selfish. If an individual is still working for minimum wage after high school or college then it is his or her own fault, not mine, or anyone else’s.

  • yes, but someone’s gotta work there, and they should be paid a living wage… just like Walmart employees.
    Not everyone can be a Doctor or Lawyer.

  • rt_trask rt_trask 1 day ago

    Sorry Christy, wrong on two counts:
    - everybody’s got to START somewhere and McD fulfills that vital function.
    If you force them to pay too much they’ll hire fewer people. No idea what your “living wage” means but I suppose that’s the beauty of it: great slogan. Too bad the results stink.

    - Not everyone has to be a doctor or lawyer. There is plenty of money to be made at myriad other jobs. All of it available if you just want to learn. Don’t you liberal loons ever get tired of this canard?

    And, like ninerfinn says, just showing up on time and working at McD can already set you on the path to better compensation. Exactly my experience too: show up, do the job well and they’ll ask you to come back to do more for more pay.

    What’s the problem with that?

  • And Christy, are you prepared for everything you buy to be 10-25% more expensive to pay for all these living wages? Are the people making those living wages going to be able to endure the same thing? Are there going to be less jobs, when everyone has to double their wages? How about you stop feeling and start thinking.

  • Ted Lasky Ted Lasky 1 day ago

    In my opinion, your comment is incredibly ridiculous. It’s no template when it doesn’t contain half the line items the average person requires in a budget. I believe that Forbes, not universally condemning McDonald’s and Visa for trying to make it seem like someone could stretch their horridly low wages so that they have extra money every month, makes it seem like someone could actually live on the wages McDonald’s pay.

    Maybe if we went back to the days when C.E.O.s and senior executives were paid 20 or 30 times what their lowest paid employees were paid, instead of thousands of times, like they are paid today, we’d have the kind of capitalism that grew America in the 50s and 60s. Today, corporations are making sure that America’s wealth is put in the hands of smaller and smaller percentages of the American people. We are creating the kind of ‘royalty’ that the Founding Fathers tried escaping from.

    No one is worth what some are being paid today. To think that a C.E.O. wouldn’t work their butts-off for $500,000/year, but would only for 20 million per year, is also nuts. We aren’t in danger of becoming a socialist society; the masses in our population is in danger of becoming serfs.

  • Thanks for your comment, point on perfect example of the disconnect we have regarding wages. Or manufacturing jobs are gone, outsourced by these same companies that have colluded to freeze wages for years. Ever see what the average pay is for a BA across the board? What about student loans? In my city, people with Masters degree’s fight over 10 dollar an hour jobs, because that’s all there is. This economy has morphed into a service based economy, trhat’s not opinion, that’s fact…And you think it’s fine to pay people below slave wages? Not everyone can go to college, they kill you with loans and tuition costs, my books alone cost upwards of 500 bucks a term, really? Cost’s go up, wages stay or lower. I just can’t believe you could agree with this, blow’s my mind the complete, total disconnect and sheer stupidity of people like you. This is the real world pal, pay people if you want them off welfare..

  • It’s liberal to KNOW that people should be paid more than slave wages?
    I’m no liberal, I worked for years on that very issue, living wage. Get past the fact it’s the right thing to do, but it will stimulate the economy. Now it’s ‘liberal’ to think people deserve wages about poverty level, moron

  • First I disagree that someone needs to work there, it there is no affordable labor machines will eventually replace them or we will learn to do without them. Second many people who are not Doctors or Lawyers (we already have too many lawyers) make a good wage because they provide services that our society values.

  • jon jones jon jones 1 day ago

    I used to believe the same thing about the CEO pay. It’s like “NOBODY’S worth that!” It’s not true, though. People with highly specialized skills are simply paid what the market is willing to pay for those skills. If they weren’t worth that much, they wouldn’t be paid that much. 20 million may seem like a lot of money to you and me, but if that CEO can increase the company’s line by say, a billion dollars, that 20 million is a pretty good investment for the company.