Bank On could solve some social issues

Learning to save your money should start early. Even though Chesterfield Schools had to give up a class to teach it; financial management was a good mandate pushed on the county by the state General Assembly.

I was taught at 14, in a somewhat fascist manner, to save some of the money I made working for my step-father’s construction company. It was good pay at the time 50 cents an hour. Although way under the minimum wage, it was to be a learning experience for me.

Twenty bucks a week and I was to put $10 of it in the bank. “Are you kidding me?” I told my mother.

By the end of the summer I had saved about $15. Financial astute was not my middle name, and although it was offered, I never took an accounting class. I wasn’t interested in debits and credits.

By the time I was 16, I bought my first car, not from the money in a bank account at the time, but with a down payment from my stepfather in a loan that I thought would go on until I would be 60. I just paid it off last year. In reality, I never made a payment. My first car was a Corvair convertible. It was a car that really didn’t attract the chics, especially when I was on the side of the road trying to fix it to get home from school listening to my high school friends blowing their horn as they passed me.

Finally I got a better car, and didn’t pay the payments on that one either. And I finally  got a few high school dates.

By 17, I still had little regard for managing my finances. I worked as a bus boy and a short order cook, and spent my money on wild weekends.

If I was short on cash, I went to borrow money, not from the nearest bank – but from my Mom.

Recently, a group of local citizens, supported by Bermuda District and Board Chair Dorothy Jaeckle, fought off a zoning change by a car-title lender that was  proposed for Chester. I thought the next phase should be eliminating the predatory lenders for Chesterfield entirely.

A little research from a friend of mine who worked in San Francisco on revitalization, told me about a program call Bank On, which will help those who don’t have a checking account or  a place to cash their paycheck other than check cashing outfits, who charge a large fee for cashing  a worker’s hard earn paycheck.

Unbanked: No checking or savings account

Underbanked: Has a bank account, but continues to rely on alternative financial services like check-cashing services, payday loans, rent to own agreements or pawn shops.

“Bank On programs (located in cities all over the country, including Virginia Beach) negotiate with banks and credit unions in local communities to reduce barriers to banking and increase access to the financial mainstream. Typically led by local government or state public officials, Bank On programs are voluntary, public /private partnerships between local or state government, financial institutes and community based organizations that provide low-income un- and underbanked people with free local or low-cost started or second chance  bank accounts and access to financial education.”

  • 7.7 percent of U.S. households are without a bank (9 million nationwide)
  • 17.9 percent of U.S. households are underbanked (21 million)
  • 43 percent of household with an income of less than $30,000 are unbanked or underbanked.
  • Nationally, 54 percent of black households and 43 percent of Hispanic households are unbanked or underbanked compared to 18 percent of white households.

Why is this important?

Part of a revitalization program is to empower those who live in the revitalization area. What empowers a household more than money and security? Not only is there a need for programs such a Bank On, it gives access to those in need of a program that helps stabilize an otherwise insecure-financial future. And the bonus is financial classes that help educate the new unbanked household to manage their money  in a better way.

Stabilizing revitalization areas could use this tool to empower its residents and give them a leg up on falling prey to a predatory lender or a predatory landlord.

Hispanic and black workers are what made the construction industry viable and now these workers are making restaurants privy to the same advantages.

But when most earnings of workers are paid out in rent and food, what happens? A lack of public safety for one, and a household being unable to handle any type of emergency, among others. If these same workers were secure in their finances, I would assume that high-rent housing, such as weekly rentals and neglected mobile home parks would begin to lose their attraction to those who experience low wages and slum-lord rental proprietors.

Once minorities are given security and empowerment, just maybe we have a chance of actually revitalizing our needy areas. Revitalization without a little stability for residents will remain as they are and an attempt at revitalization will be unsuccessful. Details: joinbankon.org/

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