One of my workers get her check today - and mentioned how she has to go cash her check at lunch. I have direct deposit into my checking account, so I asked her why she didn’t have direct deposit; more convenient, money is always there etc.
She mentioned she has never had a checking account. I was stunned. I asked how does she manage her bills and run her household. She pays everything in cash, and what she can’t in cash she pays for money orders.
I honestly don’t understand how one can not have something as simple and basic (and convenient) as a checking account? I just paid all my bills for the month in 2 minutes online. Beats standing in line at the Gas Company.
Bank tend to check credit when they open an account for you. Bad credit, and you won’t be allowed to get a checking account. That probably counts for most of the people who don’t have them.
Also, if one lived in a lower-income neighborhood, there may not be any banks near you. I think this is a despicable practice, but I don’t run any banks, so oh well.
And then there are people who just don’t trust banks. Maybe she is one of them.
hmmmm…my credit is quite bad, yet I had no trouble opening my account at a fairly huge bank (rhymes with Shmank of Shmamerica).
My worker does live in a low-income neighborhood, but there are banks nearby…she says she gets her checks cashed free at the neighborhood carniceria (yes I am in Southern California) instead of the regular surcharge (which I hear can be quite steep) - and they will accept cash payments for utilities so she can do it all at once. But then there is the issue of carrying several hundred dollars in cash around a lousy neighborhood. Personally, I hate carrying more than like $20 in cash.
I guess I’ve just been fortunate to always have banking at my disposal.
Phouchg
Lovable Rogue
Disclaimer: This may not be her reasons for going without checking. They are only my reasons.
Several years ago, I made some really serious credit errors. Errors that I didn’t take steps to correct. One such error was defaulting on $200 overdraft to my bank. When that went to collections, I paid it off. When I tried to get a checking account at another bank, I was told that I would have to wait seven years for that to go off my record.
Fortunately, the local credit union was more understanding, but it still took a while. For about a year, I did the cash-only/money-order thing. It was actually really helpful, as I learned how to manage money for the first time in my life. Money orders were only fifty cents, which was a heckuva lot better than $25 overdraft fees.
You can survive without a checking account… but you would have to do a lot of running around which would seem to defeat the purpose of not having one. Did you ask him or her? Maybe they are worried about losing their checkbook or maybe they don’t want to pay the $5 a month charge… hell, most checking accounts are free these days if you direct deposit your paycheck.
This person seems to be living in a world very different from our own… perhaps they are working under false pretense and don’t want their real identity revealed by using an instrument (a check) with their name and address on it???
Banks often charge monthly service fees if you can’t hold a minimum balance ($500 or some such amount). Last time I checked, CitiBank charged an astounding $14 a month. Even if there are banks that charge only $6 or $8 a month, $70-$100 per year can be a lot of money for some people. And if the alternative is to pay 25¢ for a money order for the 3 or 4 checks that some people write each month, well, every dollar makes a difference.
some people i know aren’t fond of paying us taxes. They work for themselves, get paid mostly in cash, and don’t leave their money sitting in a place attached to their SS # where unca’ sam can get at it. plus that’s one less record of how much money they make.
me i hardly write checks anymore. how long before my checking account with debit card becomes “debit card account with optional checkwriting privileges for additional fee” ?
I’ve been living in Maryland for a few years, which has really made me realize how wonderful New Jersey banks are. The best checking account I can find in Maryland charges $5 a month, and only allows me one teller visit a month. In New Jersey I know of at least one bank that still offers free checking, and wonderful customer service. I went to visit my parents last week, and I saw a lot of ads for free checking at other banks as well.
I wonder why NJ banks offer free checking, while Maryland banks can get away with $10 fees?
Audient, I’m with you. I never write checks unless I have no alternative. Like at my apartment. They don’t take credit cards and don’t do EFT. I suspect that if they did do EFT it’d cut into the income they make from people paying late. If not in by the fifth, it’s $50. Bastards. I forgot once, can you tell?
Then there’s the power, phone and cable. I should look into paying those automatically. Does anyone else pay those in some way that doesn’t involve either cash or check?
This applies if your checkbook and id were stolen as well. My husbands checkbook and id were stolen out of his gym bag. The left was reported to the gym, police, and bank immediately and the account closed, but his name is still flagged in the chexsystems. Thus far even though the three checks that went through the bank are clearly forgeries and the bank agree’s, we’ve been unable to figure out how to clear his name. He can write checks to pay bills, but he cannot write a check out in public shopping.
The CEO of my old company also used to run a construction company. He told me the vast majority of his workers didn’t have checking accounts and that every payday, he was expected to cash all of their checks for them.
My best friend works for a construction firm and he tells me a similar story, except that he doesn’t cash the checks. All of his workers end up at those seedy-looking Check Cashing stores every payday. He added that most of these guys blow most of their checks at the bar right after work on payday, and then cry poverty for two weeks until they get paid again.
Why do these construction workers refuse to open checking accounts? They’re losing an arm and a leg to the check cashing shops. Wouldn’t they want to avoid this?
I have had a lot of problems with banks, messing up my money, and my accounts, which led me to stop using a checking account. Also I had a big problem with writing rubber checks, and also writing checks, and then spending the money, before the checks were cashed, telling myself I’d replace the money. Granted, it takes me more time to go get a money order, but I know it’s not going to bounce, I dont have to pay monthly fees on it, etc.
I’ve known of some noncustodial folk who do not wish to have their income ‘trackable’. If you have a checking account, that info could potentially be called into court, if, OTOH, you’re working under the table and getting personal checks from every Tom/Dick & Harry around town, it’d be pretty difficult for anyone to attempt to show how much income you really have.
Also, in some cases, if you happen to be under supervision (through courts, mental health etc.) you may not be ‘allowed’ to have a checking account (no one at the correction center were allowed to have one for example, even if their own background did not involve check related offenses).
The article I cited has a link to another article which has a link to a website that has a lot of possible solutions to the problem. You might take a look.
I’ve never had one. The Australian experience tends to be that cheques are only used by people over forty (and also by businesses). It is based on age rather than credit rating. Older people perhaps don’t feel comfortable with newer electronic forms of payment, so stick to the ol’ book.
I get paid directly into my debit card account. I have a second debit card which is linked to one of my two credit cards (ie. like a permanent overdraft when I need it. If the balance drops into the red, it becomes a credit card account, in the black it’s a saving account). When I go shopping I pay electronically with my debit card, and I withdraw extra cash as part of that supermarket transaction which I will use for living expenses. I pay for petrol electronically as well -sometimes right at the pump. I pay all my utility bills at the Post Office electronically, or I pay them over the phone (free call) via credit card (it comes out of the savings account so I’m not charged interest -usually). I even use my normal ol’ debit card overseas. It’s a breeze compared to my mental picture of my mum hunched over the table trying to reconcile the stubs and complaining about the fees. The debit card is by far the most popular system in this part of the world.
My old roomie was bad with money. Real bad. Seems that having a static bank account means that it is easier for creditors to seize your funds. So, no bank account, no problems. I just made sure to get the cash from him when he had it.
Anyone remember when Isiah Thomas from the Detroit Pistons was under scrutiny because he cashed his check with a friend who owned a grocery store ?
It seems Isiah preferred to cash his checks with his friend rather than bothering with the bank. Problem was his friend also ran a gambling scheme. The government subpoenaed his checks as part of the investigation of the gambling scheme. Of course, no evidence was found to incriminate Isiah in illegal betting but it sure made for an exciting few weeks in the newspapers.
Sorry if I’m off topic but I thought the anecdote was interesting.
Most countries in Asia are cash for most transactions. When I bought my condo in Shanghai, I paid about a yard’s worth of RMB100 notes. It wasn’t possible to do a bank transaction for that.
Japan is also a very cash oriented society, and there are few personal checks. If you want to buy something, you would send cash through a special postal service.