How to live without a bank account?

Without a doubt, keeping personal finances in order is much easier to do with a bank account. With it you could review your expenses, keep a detailed record of your monthly income and even transfer the excess money to a savings account subject to an attractive interest rate. Nevertheless, there are people who prefer to live without a bank account. Can be a permanent or temporary issue (to save account maintenance costs) or while they solve a problem, such as identity theft, for example.

Regardless of the reasons you have for leaving the bank and cooperatives behind, you may ask yourself a question before taking the first step: how to live without a bank account? Although it surprises you it’s much easier than you think. You could use the cash and some prepaid debit cards to shop, pay your bills, and successfully complete the rest of your everyday transactions. Let’s dig a little deeper into this topic. Join us!

The benefits of prepaid debit cards

Prepaid cards, in addition to being much easier to request than a credit card, will allow you to carry out many operations, even if you are not banked. In fact, it could be said that most of them will give you the same benefits of a debit card linked to a checking account.

When you request it, you can load your funds, in cash, with checks and transfers, and spend the amount you need, either online or through any point of sale terminal of the merchants and stores affiliated with the payment processor.

However, you should pay close attention! remember there is Key differences between prepaid cards and debit cards, for example:

  • Prepaid cards do not require a minimum opening balance or payment of a maintenance fee and this is a major distinction between them and checking accounts.
  • The issuer will not check your credit score before issuing you the card. Remember that, unlike credit cards, they are not affiliated with a revolving line of credit.
  • To open an account, most banks will use tools like ChexSystem to check your background. This will not happen with the prepaid debit card.
  • You will not be able to spend more than the limit of the funds loaded on your card. Therefore, you will not be able to get into debt as with credit cards or make overdrafts, as in the case of checking accounts.

Note: Despite their benefits, be aware that many of these cards charge replacement fees or charges for foreign purchases. But, if you look at the other side of the coin, they could also offer you rewards, discounts and prizes.

Our recommendation

Choose a cheap prepaid card that offers you discounts in the stores you frequent the most and that exchanges currency at a very attractive official rate, that is, in exchange for a low commission.

How to live without a bank account?

The benefits of paying in cash

Until cash is replaced, it is and will remain the primary method of payment. If you think about it, nothing prevents you from paying for your purchases, gas, transportation and recreational or entertainment activities with cash. In addition, with cash you have the option of saving and keeping the rest of the money at home or reloading it directly to a prepaid card.

The main drawback of cash (and arguably the most serious) is that a credit or debit card is not such a secure payment method. For example, if you make a purchase with cash, you will not get purchase insurance and you will not be able to ask for a warranty extension or mobile insurance. And what happens if you lose it? Unlike when one of your cards is lost, you can block it and thus protect your money, you will have lost everything.

tip: If you want to use cash as a means of payment, save it for small bills, such as a train or bus ticket, to pay for a taxi or to buy a movie or theater ticket. Larger bills, like a smartphone or computer purchase, could be paid for with your prepaid card, at least as long as the daily limit allows.

Warning: Before paying with a prepaid card, ask the business or company if there are any surcharges. Remember that some stores do not accept credit or debit cards as a means of payment or, if they do, they add an extra percentage to the total amount of the purchase.

How to pay your bills if you decide to live without a bank account?

It could be said that this is the first limitation that you will have to face if you decide to live without a bank account. Why? Because, unfortunately, billers do not usually accept cash as payment. What companies are we talking about? From public service companies, such as water, electricity, gas and telephone services. Other companies, such as subscription companies (Netflix, Amazon Prime) and insurance companies do not usually accept cash either.

So how can you pay? The first option is with your prepaid card. The second option is with a payment wallet, in case the business accepts it. And the third option is to pay in person at the company, as long as it is allowed, or deposit the money in an affiliated bank. Keep in mind that some companies also allow consumers to pay their outstanding bills at supermarkets and convenience stores, agents like Western Union, etc.

tip: If you must send a payment by mail, issue a money order or money order payable to the sender. That way you won’t have any problems paying.

Note: Some prepaid cards such as Walmart MoneyCard, allow users to pay their bills online. Others, such as Payoneer, allow free transfers to other users, the receipt of funds for the collection of professional fees, among others.

How to cash a check without a bank account?

Although cashing a check with a bank account is a quick and easy way to do it, it’s not the only one. If you get paid by check and don’t have a checking or savings account, you still have options to cash it. The most traditional is to take the check to the issuing bank and cash it at the box office. For example, if the check they give you is from Bank of America, visit an agency to cash it.

Note: Take into account that the box office charge may be subject to the payment of a standard rate.

Remember: If you don’t need instant cash or just need a small amount to pay for transportation and a couple of drinks at the cafe, consider applying for a prepaid card. Most of these cards will allow you to deposit your check via mobile simply by taking a photo of it. In a few days, you will be able to make your purchases with the card or withdraw the money from the ATM.

Another alternative you have to cash your checks is to go to a retail store that offers this service. Normally, these companies usually charge a modest fee to make the collection. If you choose a retail store like Walmart, you might be much better off; You will not be able to charge a fee as long as you deposit the check on your Walmart MoneyCard Prepaid Card.

the shops of payday loans they also promote the check cashing service. However, they usually charge a much higher fee.

How to store and save money without a bank account?

Nobody can deny that one of the advantages of having a bank account is that your money will be safe.. What do we mean? Because if a natural disaster or an accident happens at home, your savings will be free from any danger. Remember that when you deposit money in the bank, it is insured by the FDIC (Federal Deposit Insurance Corporation). The same goes for credit unions, although the method of underwriting is slightly different.

You may agree with us that walking down the street with a large amount of cash could be dangerous. Even if you leave it in your home, it will never be 100% safe. After all, a pipe could break and damage the bills, the house could perish in a fire, or just someone could enter without your permission and steal everything you have gathered so far.

So how can you save and save your money if you don’t have a savings account or any other bank account? One way to do this is to deposit money onto your prepaid card. For example, the Walmart MoneyCard pays 1% APY on a $1,000 balance. However, it is capped at $10,000. Another option would be to install a safe in a safe place in the house. Most of them are very resistant and will keep your money safe in the event of a natural event or accident.

How to send or receive money without a bank account?

One of the advantages of bank accounts is that they will allow you to send or receive money easily.. You can even make a transfer abroad or receive money in another currency. But what if you have decided to live without a bank account? Here is good and bad news. The good news is that there are still ways to send money to your friends, even to receive it. You can use Western Union money sending and receiving services, for example.

Other options involve payment apps, such as Paypal, Square, and Venmo. To do so, you will need to have a prepaid card, since most of these wallets require you to link the account to a payment method other than cash. cards like Payoneer They will also allow you to send funds to other Payoneer users for free and, if you meet certain requirements, you can even pay your suppliers or receive transfers in pounds sterling, euros or dollars.

The bad news is that, despite all the ways that exist to receive or send money, sometimes there are difficulties. For example, PayPal charges fees in excess of 5% for transferring money to someone who is not registered as a friend or frequent user. If you compare it to Zelle, which is 100% free, PayPal would be at a disadvantage.

How to request a loan without a bank account?

Having an account at the bank will make it easier for you to ask for a loan from the bank, but, Is it possible to get a loan without a bank account? The answer, although it may surprise you, is a resounding yes, but it is not easy at all.

Classic lenders often ask for your bank account details so they can track where the money is going and check your creditworthiness. Therefore, it is understandable that it is difficult to go to the bank and request a loan without a bank account. Also think that, even if your credit is approved, you would not have an account to deposit the money that the bank has lent you. This would give you very few options, such as cashing the check or depositing it into the account associated with your prepaid card. All these factors make it difficult for people who want to live without a bank account to access a classic loan..

Our advice? Before applying for credit at a store, visit your local credit union or community bank branch. These types of institutions handle much more flexible conditions, you are insured and have much lower interest rates than payday loan stores, for example.

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