Why Accounts Are Important
Accounts are the first step...
...in saving, planning for the future, building credit and climbing the economic ladder.
If you do not have a bank account, you are missing out on the stabilizing benefits that a checking account provides, such as:
Cost savings: An average of five percent of your income is being spent on unnecessary fees. This amounts to about $1,000 in fees per year, or $40,000 over an average working life.3
Public safety: Without a safe place to keep your money, you are more likely to be the victim of crime because of the large sums of cash you may be carrying or keeping in your home. Elderly, disabled or undocumented immigrants can be particularly vulnerable.4
Disaster preparedness: In the event of an emergency, you have no safe way to access your money, and any cash kept in your home may be lost. The lack of a bank account impedes a government's ability to get funds to you in the event of a disaster/evacuation. For example, in the aftermath of Hurricane Katrina, an estimated 70% of evacuees did not have accounts and had no way to receive payments electronically.5
Asset building: Without a bank account, you lack the ability to save for the future, establish credit, and access asset building instruments such as loans for a car, small business, or home mortgage.
1. FDIC National Survey of Unbanked and Under-banked Households. 2009. Washington DC: Federal Deposit Insurance Corporation (www.economicinclusion.gov).
3. Matt Fellowes and Mia Mabanta, “Banking on Wealth: America’s New Retail Banking Infrastructure and Its Wealth-Building Potential,” Washington, DC: Brookings Institution, 2008.
4. New research finds that in areas where financial institutions have begun to cater to Latino customers, the incidence of armed robberies has dropped significantly due to area residents’ reduced reliance on cash-based transactions. Gregory Fairchild and Kulwant Rai, Perdido en la Traducción: The Opportunity in Financial Services for Latinos (Charlottesville, VA: Tayloe Murphy Center, Darden School of Business, University of Virginia, 2011).
5. The Washington Post/Kaiser Family Foundation/Harvard University, “Survey of Hurricane Katrina Evacuees,” Washington DC: Kaiser Family Foundation, 2005.