Center on Assets, Education, and Inclusion

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Consider the following scenarios of three households that must use their varying resources to afford daily expenses and make ends meet: The Washington household's financial health is secure. When payday arrives, they use the money from their paycheck to pay bills and buy groceries. Fortunately for the Washingtons, they have direct deposit with a local bank, so the money from their paycheck is available for immediate use. Even though their bank is located just a mile away, direct deposit saves them from making an extra errand to cash their paycheck. Their account even has automatic bill pay so that their regular payments toward utility bills and auto insurance can be deducted in an easy and timely fashion. Since establishing automatic bill pay, they have never had to remember when these bills come due. They write a check to pay the rent and use their debit card to buy groceries at the store. There’s usually enough money in their account to afford the necessary day-to-day expenses; however, a bank-issued credit card can be used when money is short. When their car broke down a few months ago, the Washingtons took out a small, low-interest loan from their bank. Taking out the loan was easy since they had good credit and a longstanding relationship with their bank. With their current paycheck, they are able to make the final loan payment and save the extra money in their savings account. The Washingtons have been able to save $100 dollars each month for the last year, steadily advancing their financial health by accumulating savings in case the car ever needs another repair and investing in their future.


Friedline, T. (2016). Building bridges, removing barriers: The unacceptable state of households' financial health and how financial inclusion can help. Lawrence, KS: University of Kansas, Center on Assets, Education, and Inclusion.

Financial Inclusion Report Year 2016