Bypassing Banks

A CNN article, today, reports that, according to survey results released by the Federal Deposit Insurance Corporation, about 8.2% of U.S. households, or nearly 10 million, lack a bank account. That's up from 7.7%, or about 9 million households, in 2009. About 33% indicate that this is because they don't have enough money to open and fund a bank account. Banks are also tending to push out unprofitable customers with the decline of free checking and fees that impact customers unable to meet minimum balance requirements and/or who may be chronic over-drafters. While some don't need or want an account and primarily use cash, one in four households have used at least one form of alternative financial service (money order, check cashing service, tax refund anticipation loan, pawn shop, money-transfer service, payday loan, etc.) and about 12% of households have used one of these products in the past 30 days.  Unfortunately, the high cost of some of these alternative financial services can take a toll over the long term.