Daily Money - Issue #257: What even HAPPENS in there?

plus a baby zebra + John Cena's car
͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ ͏‌ 
October 16, 2024 • Issue #257
Dollar Scholar

Hi y’all —

When I was a kid, the Bank of America branch in my hometown was located next to a Burger King, an Einstein Bros. Bagels and a Chili's. This was notable to Young Julia because anytime my grandma had to stop by the bank while running errands, I got a snack. And lucky for me, she always had to stop by the bank.

So imagine my disappointment when I grew up and realized frequent bank visits were not going to be a part of my everyday life. For several years now, most of my banking has been done on my iPhone — nowhere near a brick-and-mortar branch (or delicious fast-food restaurants, for that matter).

Not only do I have to make my own snacks, but I also have lingering FOMO: Surely my grandma was getting *something* out of all those pit stops at the bank. I just don't know what.

Are there any benefits to doing my banking in person? What even happens in a branch?

Let me start by explaining the landscape. It's a strange time for banks: Federal Deposit Insurance Corporation records show that in 2012, the U.S. had 82,965 bank branches, but by the time the pandemic started in 2020, just 73,107 were standing. The most recent data, from 2023, puts the number of branches at 69,997.

All those closures have been making headlines. The news is dominated by scary-sounding claims like "if current trends continue, physical bank branches could be extinct in the U.S. by 2041" (that quote's courtesy of a report from fintech company Self).

But bank branches aren't dead, says Isio Nelson, managing director for research, fraud and thought leadership at BAI, a financial services nonprofit. Their role is just changing.

"While digital is being used more with younger generations, branches are still very necessary — and not just for taking out cash," he tells me. "Branches can be an excellent resource for education on navigating the banking system for someone who may otherwise be unfamiliar and find it daunting."

It's less about the buildings themselves and more about the people who work inside them. There are a slew of tasks financial newbies can accomplish with the help of a banker, like setting up their first checking account or applying for their first credit card. But the services offered go way beyond that.

I may want to pick my banker's brain on the merits of opening a certificate of deposit account or a money market fund, Nelson says. Or I can ask them how to budget or maintain a good credit score.

the guy from the bank i had a crush on left me on read and now i have to go to a different bank branch in a different city ❤️

Amid dubious TikTok life hacks and shady influencers, bankers are generally people I can trust to give solid advice, says Shawn Niehaus, head of consumer banking for Fifth Third Bank. Simply by walking into a branch, I know that I'm getting expert, well-vetted guidance on my financial goals.

Sure, I could seek that out online, but people prefer to talk to people, especially when it comes to the intimate topic of money. Plus, Aron Levine, co-head of consumer banking and president of preferred banking for Bank of America, points out that it can be easier to navigate complex financial situations like planning out retirement savings IRL.

"Clients want to come into our financial centers for a conversation about their finances, especially when it concerns a larger purchase, like a car or a home, or when they want to set up a savings plan for their child’s college education, for example," Levine says.

As evidenced by my grandma anecdote, this is a generational trend, for sure.

While 60% of millennials (born between 1981 and 1996) most frequently use mobile banking apps, just 4% said they bank at branches in a 2023 survey from the American Bankers Association. On the other hand, 31% of baby boomers (born between 1946 and 1964) opt for mobile banking most often, with 16% saying they visit branches.

"Historically, clients would visit financial centers for daily transactions — depositing checks, moving money, paying bills. Today, clients more often are choosing to complete these activities via digital channels," Levine adds. "Our business has shifted from a transactional model to one based on relationship."

Building relationships with folks of all ages is key for banks these days. In fact, Niehaus says Fifth Third has been redesigning its branches to feel more casual. Gone are the days of awkward teller windows and stiff chairs where I have to sit across a desk from a stuffy dude in a suit. Banks are now more focused on providing couches, big-screen TVs and coffee bars where I can hang out with a banker side by side.

It's about the vibes, and about the idea that a long-term relationship with a specific banker at a specific place can benefit me as I progress through life.

And while I have the privilege of preferring to bank on my phone, that access can be crucial for folks in underserved communities, where low-income residents have to rely on alternative financial products that charge high fees and dig them into debt.

"Developing these relationships with a banker in a branch can really be the stepping stone for someone who is underbanked moving into having or improving their credit score, which would, in turn, allow them to take out a loan for a car or even a house further down the relationship," Nelson says.

The bottom line
(but please don't tell me you scrolled past all of my hard work)

Physical bank branches can provide the opportunity for me to connect face-to-face with financial experts who can guide me as I hit various milestones. While it's certainly possible to accomplish this online, as Niehaus puts it, "having a personal touch matters."

Bankers can sell me stuff, sure — but they can also offer advice, and that's a cool resource to have in my pocket.

teamwork
via Giphy

Smart MONEY MOVE
got over $10k in tax debt?

TaxesIf you’re feeling overwhelmed by back taxes, there’s good news: You don’t have to deal with it alone. A tax relief specialist could be your BFF, working with the IRS on your behalf and exploring options like payment plans or temporary collection stops based on your situation. The right provider may help you reduce your tax burden, allowing you to take control of your finances and regain peace of mind. Click below to start tackling your tax debt today.

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Receipt of the week
check out this wild celebrity purchase
John Cena
via Instagram

Wrestler/actor John Cena is selling a signed Lamborghini Diablo VT Roadster replica he commissioned 20 years ago. Cena said on a recent podcast that he’s spent about $500,000 on the car, calling it his “worst financial decision ever,” which is a ringing endorsement if you ask me.

Internet gold
five things I'm loving online right now
1
Limited Too, the store of my fifth-grade dreams, is staging a triumphant return — complete with adult-sized clothing. The beloved ‘90s brand posted on Instagram recently that it intends to release a “tribute to our cherished OGs that have supported us all along” in the spring. That means you have, like, five months to get your mom on board.
2
Should we all be toasting our pasta before boiling it? And cutting our chicken cutlets differently?
3
Harrison Ford does not want to be a menswear icon.
4
BJ the baby zebra is a county fair sensation. At just six months old, "he's a spoiled brat," his owner told the Clarion-Ledger. "When he's not traveling, his days start out when we go out and feed him and then we'll take him for a walk … he doesn't know he's a zebra."
5
 What in the nostalgia is happening here?!

401(k)9 CONTRIBUTION
send me cute pictures of your pets, please
Zoey
via Denise Glum
This is my cute pup Zoey, who lives in Florida. Zoey loves branches — well, more specifically, sticks.

Speaking of banks, did you see Money released its Best Banks of 2024-2025 list? Check it out if you haven't already.

Then take me to Chili's.

See you next week.

P.S. 

Do you visit bank branches often? What do you do there? What's your favorite Harrison Ford flick? Send comments, concerns and 401(k)9 contributions to julia@money.com.

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