CD Rates Summary January 14, 2020
Federal Reserve, the Economy and CD Rate Forecast - Jan 14, 2020
The Best Money Market Account Rates in January 2020Analysis Shows Only 3% of Americans Have More Access to Post Offices Than Bank Branches
Several prominent Democrats — including Sens. Bernie Sanders, Elizabeth Warren and Kirsten Gillibrand; and Rep. Alexandria Ocasio-Cortez — support the idea of providing basic banking services through U.S. post offices.
There are several reasons why advocates are getting behind this concept, but the main idea is concern for Americans who live and work in so-called “banking deserts,” where access to basic financial services is limited by geography. Supporters believe that mandating the United States Postal Service (USPS) to provide basic financial services would help address the problem of banking deserts.
While it’s true that banks have closed branches in many communities, due in part to the spate of mergers following the Great Recession, there are still far more bank and credit union branches than there are post offices. This makes us wonder how many Americans really have better access to post office locations than to credit union or bank branches.
According to my analysis of available location data for banks, credit unions and post offices, it seems that post offices are a less convenient option for most Americans. However, this fact does not mean the financial and banking needs of a substantial number of adults are well-served.
Key findings
- About 20% of U.S. counties have more post offices than banks and credit unions. Those counties are home to about 7.2 million adults, or 3% of the entire adult U.S. population.
- Around 1% of counties have a post office but no bank or credit union branch, representing an adult population of under 207,000 people, or 0.1% of the adult population.
- There are about 88,500 bank branches in the U.S., over three times the 26,500 U.S. post offices I was able to map. Adding in almost 22,000 credit union branches, there are about four traditional banking branches for each post office.
- Nearly 32% of zip codes are home to one post office and no bank or credit union. These are the only examples of zip codes where post offices outnumber traditional bank or credit union branches.
- Around 38% of zip codes have a greater combination of banks and credit unions than post offices.
- Almost 16% of zip codes have neither a post office nor a bank or credit union. Meanwhile, 13% have an even number of post offices and bank and/or credit union branches.
Putting it in context
It’s important to remember that traditional bank and credit union branches aren’t the only game in town. The internet and mobile technology have greatly expanded the reach of banking services. People can use computers and smartphones to deposit checks, transfer money, pay their friends and even apply for loans.
Online banking is not a solution for people who lack technology access or skills, but basic financial services are also available at nonbank retail outlets, such as currency exchanges or check cashing offices. Walmart claims that it serves millions of people at the MoneyCenter offices in their stores.
Our analysis was broken down by zip code to capture smaller geographies, but a person might live one block, 20 blocks or 15 miles from the next zip code. In addition, our county-level analysis attempts to give a better sense of how much access people have, particularly rural or suburban Americans who are more likely to be car dependent.
Limitations of the analysis
Finding a list of post offices has proven challenging. In the end, I had to download individual state pages from the USPS website, but there did appear to be some issues with their list, which only presented state, zip code, name and the date that a post office was decommissioned. Many of the post offices did not have zip code information, and a spot check of about a dozen such lines didn’t show post offices with those names. Additionally, 539 post offices had zip codes that didn’t appear on a zip code to county crosswalk from the Department of Housing and Urban Development, and a search for a sample of those zip codes on the USPS site showed that they were invalid. It’s possible that we are undercounting post offices because of the issues inherent in the data.
It’s also the case that some zip codes map to multiple counties, presumably in very low-density places. I assigned those post offices to the first county associated with the zip code, on the basis that it seems to be the primary county associated with it. This applied to over 9,400 post offices.
The post office reports that there are 31,324 Postal Service-managed retail post offices in the United States, and I was able to map 26,516 locations. I excluded post offices in U.S. territories, such as Puerto Rico, Guam and the Virgin Islands, among others. It’s also possible that the larger number includes services available inside third-party stores or colleges.
There were no such issues with the bank branch or credit union locations, which included county data.
Methodology
Using data from the FDIC and NCUA, I mapped the total number of bank branches and credit unions according to their reported zip codes and counties. Using data from the U.S. Postal Service, I mapped post offices according to the reported zip codes, and used the zip code to county crosswalk from HUD to map them to counties. In the event that multiple counties were associated with a single zip code, I used the first-named county.
Mapped bank addresses were limited to full-service brick-and-mortar offices, full-service retail offices, full service seasonal offices, limited service facilities and limited service contractual offices. Listed post offices with blank or non-existent zip codes were excluded, following spot checks that were unable to identify those zip codes or post offices through other USPS search portals.
+ Need a Cashiers Check / Bank Money Order in a timely fashion.
+ Notary Services.
+ Problem resolution is better conducted in person.
+ Safe Deposit Box availability.
While I do 95%+ of my banking online, I would not be with a bank that didn't have a physical presence within 15 miles, or so.
So you have to think in terms of the average person, who, with a family, job, and other concerns, can only hold so much in their brain at one time.
Having the Post Office offer bank accounts is a good idea. Anyone who has travelled and/or lived overseas in any of the numerous countries that have this setup know how well it works. Japan's one example, and it doesn't hurt the competition at all (look how many Japanese banks there are). You don't have to use them, you can keep banking at Bank X or Credit Union Y. But a little competition never hurt. And in the countries where the post office offers banking services, they coexist quite well with the other banks and credit unions.
As stated in the article, Post Office Banking:An Old Idea Getting New Life many Americans living in poor neighborhoods and rural areas rely on costly off the grid services such as payday loans and check cashing. An alternative to payday loans could save Americans about 90 billion a year.
In my experience, many banks require a minimum balance for a savings account to avoid a monthly fee. Some credit unions only require a $5 fee to open a savings accounts but have eligibility requirements and fewer number of branches. And sometimes bank fees occur like when your daughter is first using a debit card without checking her balance and a $5 mocha latte from Starbucks becomes a $36 drink. (as an aside, going into my bank regularly, not participating in online banking resulted in my bank's manager reducing several fees my daughter incurred)
If 40% of Americans would struggle to cover a $400 emergency expense, wouldn't an alternative to get a small loan be helpful. :)
Post offices offer Money Orders already, so they are into a finance operation already. Having a tie-up with US Treasury to offer some I Bonds, EE Bonds, and others might be a great choice.
Treasury Direct offers money movement to/from Banks, so maybe some sort of a tie-up to offer regular checking/saving/bill-pay sort of option will be nice.
Will support Sens. Bernie Sanders, Elizabeth Warren and Kirsten Gillibrand; and Rep. Alexandria Ocasio-Cortez in their efforts !!!
There is link that's in turn linked via the first paragraph. Giving it below.
https://medium.com/@SenSanders/senator-bernie-sanders-and-representative-alexandria-ocasio-cortez-s-plan-to-stop-big-banks-and-1817c205587b
Sen. Sanders and Rep. Ocasio-Cortez are giving details about "Loan Shark Prevention Act". It's a nice effort to curb the sky-high interest rates that some Americans pay. In rural communities where there is dearth if banks/CUs it might be a good idea for USPS to step-in the start offering small loans.
What rates should the post office charge? Who will be subsidizing the low rates and what happens with unpaid loans? What protections and regulations would they have to follow? How do you submitt a loan application? Training? It ain't going to happen. Better chance for the Green deal. Why not give free loans along with healthcare, free education.
So it's not far-fetched idea to provide small loans that offer much lower rate than Pay-Day loans to the needy Americans.
I have no answers to the various questions you have asked, but I am sure policy wonks will come-up with answers.
The post office being a bank is not going to happen. And let the "policy makers" decide things.
Government borrows money all the time by issuing I Bonds, EE Bonds, Water Bonds, etc. Able Americans are happy to lend government the money.
Similarly the Government should be free to loan money as well. Needy Americans surely will be happy to borrow money from the government, at the rates much lower that some of the Pay-day lenders offer.
Wonder which Tea Pot Dome friend of ours took the Old Post Office Building in Washington DC?
Wonder if any meaningful royalties got paid to the GSA for that particular lease of the Old Post Building?
Technology is also what killing the post office. People do not need the mail to receive bills or pay them. You can PDF documents. First class mail went down over 2 billion pieces. So the answer is to raise rates 10% and less people and businesses will use USPS.
The trucks are inefficient and are designed for 1st class mail and not packages. The old Grummun models they use in my area get 10 miles to the gallon.
No need for 6 day mail. My letter carrier has days when he delivers almost no mail. I read that ending Saturday letter delivery would save 2 billion a year. You would no longer have to have relief drivers to fill in the 6th day.
The post office sometimes does last leg for UPS. UPS bulk delivers to a local post office who then delivers to the local addresses.
PDF documents are good and fine, but that's always an option. Why just recently I personally had to completely depend upon USPS tp delivery the mail ASAP. Check the details about when/how/why in the thread right here at Deposit Accounts.
https://www.depositaccounts.com/banks/dover-cu/offers/
You will notice that each of the Blog Post has the time-stamp !!
BTW, the DMV mails me the Vehicle Registration Renewal Notice and then the Vehicle Registration Sticker via USPS. I get the Ballots via USPS mail. I get Credit/Debit cards via USPS mail. From time to time I get Jury Duty Summon from USPS mail. Maybe the news of the demise of USPS because of the technology may be a bit premature !!
You surely are entitled to your opinion of "no need for 6 day mail", however you ought to be respectful if others, like me, have an opinion that "yes, 6 day mail is needed".
Coming to the fuel-inefficiency of trucks ... well ... lawmakers are working on old/new green/greener deals ... let's see what gets done.
If the rural Americans have no access to banks, but have access to US Post office, then for such Americans it does make sense to have access to Bonds.
Corner convenience stores often sell Lotto tickets, so why should a neighborhood Post Office not sell Series EE bonds that will double in value in 20 years? (That's around 3.52% interest.)
What about living within your means and not having kids you can't afford? Nah, I should be bound & gagged for even suggesting it.
Many of the banking transactions can be achieved with prepaid cards like Bluebird. So products are already out there. And bluebird is available at walmart.
I was an 18 yr old kid in the Air Force, doing my first tax return. I forgot (or didn't know) to list the $23 of interest I earned in a savings acct. Three years later, I get a letter from the IRS. THEY FINED ME $250 for failing to list my interest. A lousy 23 bucks.
Fast-forward 48 years, I did my tax return using my cell phone via one of the online tax prep companies. Only once. Probably not safe to use a phone.
I have visited Post office for paperwork related to Pass-Port as well.
USPS, can do a lot by having tie-ups with other Government Agencies - State-Department, US Treasury, and of course the beloved IRS.
Nearly 32% of zip codes are home to one post office and no bank or credit union
People in those zip codes, especially in rural areas, could benefit from basic banking services at the post office.
That "day" as it were, is fast approaching, if in fact it is not already here.
Some things never change.
You say one thing, but apparently still believe in a socialist government to support you.
so much for the little guy to make a buck Huh.
https://www.nytimes.com/1982/12/27/business/disappointing-end-for-all-savers.html
Huh?
Who pays the 5%?
Here's an idea to promote good behavior.
You're hungry...get a job, earn money & buy some food.
You're cold...get a job, earn money rent some shelter.
You need transportation...get a job, earn money, take the bus or buy a used car.
You WANT a phone...get a job, earn money & buy a phone.
You're not very marketable...get an education, get a job & earn money.
The government can encourage "good behavior" by cleaning up the cities, providing good public transportation, enforcing existing laws, ensuring schools are safe and effective and defending us from enemies. A guaranteed 5% savings account is about the dumbest idea one can imagine, reminiscent of the failed...
https://myra.gov/
1. Welfare checks that encourage people not to work and to have multiple kids they can't afford to pay for.
2. Bridge cards that encourage people not to work.
3. Free services Cell phones, monthly minutes, free cable that encourage people not to work.
4. Subsidized housing that encourage people not to work.
5. Special deals like HARP that encouraged people to stop paying their mortgage to qualify for special low interest rates and write offs.
6. Obamacare which encourages the need not to work for medical benefits.
And the list goes on but you see my point? All current handout programs encourage bad behavior and we are all paying for them currently through taxation. All I was suggesting is that how about encouraging GOOD behavior.
Go look at the failed myra for all the evidence you need. Besides, once again, why should I pay another bill for someone I don't know? When is enough enough?
When the unemployed gender-studies major comes demanding YOU pay THEIR student loan bill get back to me.
Remember, someone has to EARN the dollars you want to give away to someone who isn't earning their own. Stop making the payments and watch how fast people find productive jobs!
1. It wasn't any better than what you could get elsewhere.
2. It was a IRA so you couldn't get your money out to pay bills without paying a penalty.
Heck that idea was about the only thing Obama did that I actually agreed with because it encouraged good behavior.
I'm not advocating all the handout programs but I don't see anything wrong with a hand up. Are you against unemployment insurance as well? I know it costs us money but when you get laid off it sure helps until the next paycheck rolls in.