Categories: life, personal finance, saving
“Have compassion for all beings, rich and poor alike; each has their suffering. Some suffer too much, others too little.”
Buddha
Wealth requires a commitment and responsibility to those with less. Offer your knowledge and expertise to those without.
MAIN TOPIC: The Problem with Check Cashing Services
I just returned from a quick trip to Wal Mart to pick up some groceries. It’s Friday afternoon and my check out lane was directly across from the “Money Center.” This “Money Center” is a place where you can cash checks; for a fee, buy money orders; for a fee, and do a lot of other financial tasks; FOR A FEE. It is not a bank.
Because at a bank, if you have the right type of account, you can get your paycheck deposited FOR FREE!
The line was really long at the money center. In fact, there were people trailing out into the main part of the store. Many lower income people DO NOT HAVE A BANK ACCOUNT.
I remember back to my first full time job as an invoice clerk; I was amazed on payday when my co-worker and I went to the bank. She CASHED HER ENTIRE CHECK AND TOOK ALL OF THE MONEY! I thought it was quite odd that she didn’t put any of it into the bank.
But I digress, back to the Wal Mart Money Center. I got very despondent after seeing the enormous line-because I knew most individuals were there because they didn’t have a bank account. And they were lower income and paying a fee that higher income people didn’t pay, just to gain access to their money.
I was struck by several things:
- How can one save, if he/she has NO BANK ACCOUNT?
- How can one move out of living “paycheck to paycheck” without a BANK account?
- Where are those individuals in the Money Center line going to learn the principles of Financial Literacy?
PRACTICAL APPLICATION: You Can Help
If anyone reading this does not have a bank account, read My Story. My dad was so poor growing up, he started to work at age 10 to help out his family! In order to move out of poverty, you have to change your mindset and your life. It is possible.
Take a risk and share some of your financial literacy wit h those around you. Don’t be afraid to talk to others about basic smart money habits. Lots of folks out there don’t have anyone to teach them money basics. If you see a friend or co-worker making stupid money choices, take a risk and talk about it.
And, if you don’t have a bank account-Open a bank account with the money from your next paycheck. Make sure the account does not charge a monthly fee or for a low balance. Go to bankrate.com to compare rates and services.
Make this commitment to yourself; never cash your entire paycheck. If you have the cash, you will spend it! Put part of every paycheck in a savings account!
ACTION STEP:
Get a notebook, label it: “(your name) Personal Finance” and store it by the computer. Use it to keep all of your personal finance goals, thoughts, activities, and plans.
Offer some of your basic financial knowledge to someone around you. They will benefit, and so will you.
It always breaks my heart when I see things like the long line you spoke of at Wal-Mart. I think saving is something that just isn’t an option for some people. Not because they don’t have the money, but because they just don’t know how. Living week-to-week is the only way they have ever lived.
I have shared PF tips with many people. But, some people just don’t want to change. I will keep trying, but some habits can be very hard to break.
I never knew of people who didn’t have a bank account… even when I was a dirt poor student and worked part-time I had a bank account, simply because you needed one if you wanted to get paid.
Definitely, if you can help these people out, for sure the first step is to get them to start setting aside at least 10% of their income in a savings account and go from there.
P.S. You should look into anti-spam ([Askimet and/or Spam Karma] + Bad Behavior). You have a few spam links on this post; they will kill your site if you don’t control them.
Hi Barb,
Absolutely heartbreaking to hear this because I know that those people are being taken advantage of. Some people can justify it by “they should know better,” but if you haven’t been taught then you won’t know. One thing I suggest to people with a checking account that live paycheck to paycheck is kind of a psychological trick.
I tell them “if $0.00 is the bottom of your checking account and you don’t go past that, then why not give yourself a new bottom to the account? Make $1,000.00 your new $0.00. Don’t go below $1,000.00, or you’re overdrafting (per se)!” It gives a much different perspective to some people. If you can manage to draw your account down to $0.00 without overdrafting, then why can’t you draw it down to a new imaginary $0.00 of $1,000.00? This has helped a few people I know.
Thanks,
Timothy
Wealth Artisan Team Member
http://WealthArtisan.com
@Everyday-Keep up the financial literacy advocacy- it really does make a difference.
@Kevin-DEFINITELY-saving 10% of pay is step 1!! (I’m working on the spam, thanks)
@Timothy-I agree, the psychological tricks of saving are REALLY helpful. “Nudge” by Richard Thaler wrote a whole book on it!
Thanks to all commenters for taking the time to visit and add to the community! Barb
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