Economic Security Later in Life, New Report on Short-term Loans

27 10 2009

 Improving Economic Security Later in Life: Meeting the Credit and Financial Services Needs of Older Persons

The Woodstock Insititute’s new report examines financial products that take advantage of the economic vulnerability of older persons and highlights key features of some alternatives. It is based on extensive conversations with leading members of the policy and advocacy community, financialservices industry, and bank regulatory agencies. The report concludes with recommendations for both bank regulatory andfinancial institution policy to advance financial products that protect the economic security of older persons.

Checking accounts with high-cost overdraft fees are increasing older persons’ economic vulnerability, says a new report from Woodstock Institute, “Improving Economic Security Later in Life: Meeting the Credit and Financial Services Needs of Older Persons.” The controversial overdraft fees, recently under fire from Senator Chris Dodd (D-CT), particularly burden beneficiaries of Social Security payments and low-income older persons.
 
Automatic enrollment in overdraft programs means that many older persons are being charged high fees for products that do not want or need.  In fact, 75 percent of older persons would prefer to have a transaction declined than incur overdraft fees. Persons aged 55 and over pay $4.5 billion in overdraft fees each year. Over $513 million of these overdraft fees are levied on recipients of Social Security benefits.P1080004

The report, based on extensive conversations with leading members of the policy and advocacy community, financial services industry, and bank regulatory agencies, found that the availability of transparent checking and savings accounts is a key financial concern for many older people. 

As the national debate on consumer protections for financial products continues, this report lays out several key concerns of older persons that should be included in any reform efforts.

The full report is online at the Woodstock Institutehttp://www.woodstockinst.org/publications/research-reports/

PDFicon1   Improving Economic Security Later in Life: Meeting the Credit and Financial Services Needs of Older Persons

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