If you live in a neighborhood that is saturated with fast-food restaurants and bodegas but does not have a grocery store, you are probably going to find it very difficult to stick to a healthy diet. It would likely be similarly hard to manage your finances and build wealth without a bank branch in your neighborhood. Unfortunately, that is exactly what an increasing percentage of households in the United States are being told to do: manage their finances and build wealth without access to a nearby mainstream bank branch.
Economists from the New York Fed recently investigated the increase of “banking deserts,” or communities with little to no access to mainstream banking services, in their Liberty Street Economics blog. They merged the locations of FDIC-insured bank branches with U.S. Census Bureau data on households’ income and race to determine whether lower-income communities and communities of color have disproportionately borne the burden of post-recession bank branch closures. To be quite clear: The most important takeaway from the New York Fed’s investigation is that lower-income communities and communities of color have historically and disproportionately limited access to mainstream banking services. These trends have implications for households’ and communities’ opportunities to leverage financial products and services to their advantage.
[For more of this story, written by Terri Friedline & Mathieu Despard, go to https://psmag.com/struggling-t...0f330e725#.oyvlmmgml]
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