How possible? - for a $500/yr clothing budget???

Not because they can't afford it.  They are willingly to make themselves look unpresentable. 

If you see "name brand" on them but not even match, 90% of the chance that they are fake or that's the only thing they have.

Not to say you have to spend a lot of money but take care of your appearance is very important. We want every Chinese woman to look good, right?