Researcher

Abstract: Using a proprietary dataset of credit bureau records, Cohen-Cole (2008) finds that banks set credit limits on revolving accounts based in part on the racial composition of the neighborhood in which each borrower resides. This paper evaluates the evidence presented in that working paper using the same proprietary database of credit bureau records.

Abstract: Reverse mortgages allow elderly homeowners to tap into their housing wealth without having to sell or move out of their homes. However, very few eligible homeowners have used reverse mortgages to achieve consumption smoothing until recently when the reverse mortgage market in the United States witnessed substantial growth. This paper examines 1989-2007 loan-level reverse mortgage data and presents a number of findings. First, I show that recent reverse mortgage borrowers are significantly different from earlier borrowers in many respects.

To foster greater participation among workers who have access to employer-sponsored retirement plans, Congress included provisions that facilitate plan sponsors’ adoption of automatic enrollment policies in the Pension Protection Act of 2006. To foster greater retirement savings among workers who do not have access to an employer-sponsored plan, proposals have been made at the federal level for an “automatic IRA” and at the state level for state-based programs.

Abstract: This study examines the relationship between bank account ownership and student knowledge of personal finance. To assess financial knowledge, the study relies on national data collected every two years by the JumpStart Coalition for Personal Finance. Using test scores from the 2008 JumpStart survey, I assess whether scores are significantly higher among students that have bank accounts, relative to those students that have no formal banking relationship, controlling for demographic and socio-economic variables that might influence financial knowledge.

American workers increasingly rely on defined contribution (DC) plans like 401(k) plans and individual retirement accounts (IRA) for retirement income. In this report, GAO examined: (1) the types of fees charged to participants and investments of various DC plans; (2) how DC plan sponsor actions affect participant fees; (3) how fee disclosure requirements vary; and (4) the effectiveness of DC plan oversight. GAO reviewed laws and regulations and consulted with experts, federal officials, service providers, and six plan sponsors.

Abstract: This paper presents data from a new survey of low- and moderate-income households in Detroit to examine bank account usage and alternative financial service (AFS) products. We find that for the vast majority of households, annual outlays on financial services for transactional and credit products are relatively small, around 1 percent of annual income. This estimate is lower than those extrapolated by previous work using the posted fees of financial services alone, suggesting that LMI households do not always choose the most expensive financial services option.

Under federal regulations, 401(k) participants may tap into their accrued retirement savings before retirement under certain circumstances, including hardship. This "leakage" from 401(k) accounts can result in a permanent loss of retirement savings.

This article summarizes the key findings and recommendations drawn from the FDIC Survey of Bank Efforts to Serve the Unbanked and Underbanked. It is intended to inform bankers, policymakers, and researchers of the results of the survey and to outline steps to improve access to the financial mainstream. Unbanked individuals and families are defined as those who have rarely, if ever, held a checking account, savings account, or other type of transaction or check-cashing account at an insured depository institution.

Abstract: A large and growing number of low-to-moderate income U.S. households rely upon alternative financial service providers (AFSPs) for a variety of credit products and transaction services, including payday loans, pawn loans, automobile title loans, tax refund anticipation loans and check-cashing services. The rapid growth of this segment of the financial services industry over the past decade has been quite controversial. One aspect of the controversy involves the location decisions of AFSPs.