Millions in U.S. Without Bank Accounts

Real Estate Agent with Overland Park Real Estate (No association with Inc)

I saw an article about this on AP and just had to post some excerpts from it!  Just blew me away.  I couldn't believe that with as digital as our society has become we still have 1 in 12 people in America whom don't have bank accounts of ANY KIND...  Grandma stuffing money under the mattress isn't the only one living outside the banking system.

making a deposit

As many as 28 million people in the United States are forgoing traditional financial institutions because of mistrust, cultural and language barriers or a belief that by the time all the bills are paid there will be nothing left for an account.

That can be expensive and risky. People can run up big fees to cash checks, pay bills and meet their other financial needs. Walking around with large amounts of cash can make them a target for thieves.

The bankless are estimated to earn hundreds of billions of dollars a year in income. Seeing a business opportunity, banks are trying to draw in these potential customers. So, too, are check-cashing businesses and retailers, including Wal-Mart.

Many people, however, still resist, preferring to remain in the financial shadows.

They tend to be minority - Hispanic or blacks especially - as well as low income and young.

According to the Federal Reserve, about one in 12 families - 8.7 percent - does not have a bank account.

The number is higher for the poorest - nearly a quarter of families earning less than $18,900, the Fed said, citing 2004 data.

For some, like Rosa Alvarez, the financial choices can be bewildering.

"I don't understand about this bank stuff," says Alvarez, 54, who lives in Texas. A nagging fear that she might make a mistake "if I don't keep up with it right or something" keeps her from opening an account. She had one once, briefly. But she had trouble keeping track of her balance. She thinks that when the account closed, she owed the bank $12.

Carlos Maren, 25, a cook, is afraid that if he opens a bank account in the U.S., he will get hit with fees for not keeping in enough money or for taking out more money than he has.

"My uncle sometimes says that it's expensive ... because  getting a bank account...

Some of the different facts and figures came from different places... Below...

On the Net:

Federal Reserve:

Office of the Comptroller of the Currency

Financial Service Centers of America:

American Bankers Association:

Consumer Federation of America:


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Eric Bouler
Gardner Realtors, Licensed in La. - New Orleans, LA
Listening to your Needs

They do not want to pay taxes? They want to hide income?

Jun 24, 2007 10:49 PM #1
Lexa R. Montierth
Tierra Antigua Realty - Sahuarita, AZ
Real Estate Sales Agent and Marketer
I am ready to give up a bank account myself...except our paychecks are directly deposited.  One slight miscalculation  of a missed direct debit turned a 20 dollar mistake into a 600 dollar over draft extravaganza.  No lie.  There are reasons not to use a bank account, but overall it takes better education and better banks who look out for the customer first instead of itself.
Jun 24, 2007 10:58 PM #2
Roberta Murphy
San Diego Previews Real Estate - Carlsbad, CA
Carlsbad Real Estate and Homes
More recently I hear of people going back to old school bill paying (snail mail) because they fear identity theft with online banking.
Jun 24, 2007 10:59 PM #3
Jordan M. Mackey
Overland Park Real Estate (No association with Inc) - Overland Park, KS
Overland Park Real Estate ::

HOLY CHOW Lexa!  And I though my girls friends couple hundred dollars shes paid with her learning experience of "Bank of B.S! and High Fees" Was bad enough, but geesh! 

You're definitly takes the cake!

Jun 24, 2007 11:00 PM #4
Springfield, MA
Well I remember when my grandmother passed away in 1989 they had found a HUGE amount of cash under her mattress. She didn't trust banks and to be honest I don't think she ever knew how to fill out s check. They were old school Italians and he took care of all the household finances. The comic photo made me giggle because of what transpired with her.
Jun 24, 2007 11:01 PM #5
Jordan M. Mackey
Overland Park Real Estate (No association with Inc) - Overland Park, KS
Overland Park Real Estate ::

Roberta yeah I think people are starting to become over cautious in instances like that.  Bill paying should be fine to do on-line, however Americans are start to push their limits way to far and living paycheck to paycheck is starting to catch up to people.

Thats why I'm a BIG FAN of overdraft protect with a credit card linked to your account heck it has saved my butt a ton of times.

However, it also got me into some heat when someone stole my Paypal login info and racked up $2,500 in over seas and digital payments before my bank turned of ACH transfer...  Geesh that was a boat load of paper work to clean up!

Jun 24, 2007 11:03 PM #6
Jordan M. Mackey
Overland Park Real Estate (No association with Inc) - Overland Park, KS
Overland Park Real Estate ::
Maureen thats hilarious!  Great mini-story, might help people be a little more aware of cleaning out Grandmas house after they pass :-P
Jun 24, 2007 11:05 PM #7
we have the overdraft protection on our account. Most banks will offer it for free with certain accounts. but you have to ask. We specifically asked for it because we had an identity theft issue at our old bank and wanted protection in case it happened again
Jun 25, 2007 05:40 AM #8
Kimberly Grant
Exit Leon Crawford Realty - Huntsville, AL
Real Estate Agent - Huntsville Alabama
I had no idea how many people really did not have a bank account until I started working part time for a company during tax season.  The number of people that came in and could not use direct deposit because they had no bank account was just mind blowing.  Besides the check cashing fees that they must pay just for their pay checks alone, I must imagine the headache of paying bills and everything else is just awful.  Surprising but it is true... many do not have bank accounts.
Jun 25, 2007 12:29 PM #9
marti garaughty - Montreal, QC
a highly caffeinated creative type...

 Very interesting post Jordan, although considering the insane ATM charges we pay, it seems like the bankless are the smart ones.

marketing with closing gifts,

Jun 25, 2007 03:02 PM #10
David Phillips
Solid Source Realty - Marietta, GA
This doesn't even quantify the number of people who HAVE accounts, but have balances that average $5.00. 
Jun 25, 2007 03:22 PM #11
Membership Cancelled
Pullman, WA

I am currently working with a family that has zero accounts...they just received an inheritance...Time to open one up!

Oct 06, 2007 04:49 AM #12
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Jordan M. Mackey

Overland Park Real Estate ::

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