Why do so many Latinos distrust banks, and what alternatives exist?

A fact we can’t ignore

Did you know that more than 12.2% of Latino households in the U.S. don’t have a bank account? That’s double the rate of white households, according to the FDIC (2021).

We’re not just talking about a statistic — this represents millions of families living outside the traditional financial system.

What does it mean to be “unbanked” or “underbanked”?

Unbanked: Not having a bank account at all.

Underbanked: Having an account but still relying on alternatives such as check-cashing services, payday loans, or keeping money in cash.

For many Latino families, the relationship with banks is limited or nonexistent.

Why does this happen in the Latino community?

Some common reasons include:

Distrust: Negative experiences in their home countries or in the U.S.

Language & financial literacy: Difficulty understanding terms and processes in English.

Hidden costs: Fees, overdraft charges, and minimum balances that create fear.

Immigration status: Some families believe they don’t qualify to open accounts.

The consequences of avoiding the financial system

Risk of loss: Keeping cash at home exposes it to theft, fire, or accidents.

No credit history: Without a bank account, it’s almost impossible to build credit — limiting access to loans or mortgages.

Fewer investment opportunities: Money “under the mattress” never grows.

A little-known alternative: Indexed Universal Life Insurance (IUL)

Not relying on a bank doesn’t mean you don’t have options.

Indexed Universal Life (IUL) insurance offers unique benefits:

💰 Protected savings: your money grows based on financial indexes, but with downside protection.

🛡️ Family protection: if something happens to you, your loved ones receive a tax-free benefit.

📈 Personal retirement plan: works like a “private account” to build wealth outside of a 401(k).

🚫 No need for a traditional bank: everything is managed through the insurance company.

The next step is in your hands

If you’re part of that 12.2% without a bank account, it doesn’t mean you’re out of options.

Today, there are tools that allow you to save, protect, and grow your money safely and accessibly.

👉 Schedule a free call with me and I’ll show you how to start building your financial future without depending on a bank.