Financial Management Practices Among People Experiencing Homelessness: An Exploratory Mixed-Methods Study

Background and Purpose: Homelessness in the United States reached a record 771,480 people in 2024, constituting an increase of 18.1% over the prior year. Financial instability is known to precipitate and perpetuate homelessness, yet little is known about how people experiencing homelessness (PEH) use financial services. Access to safe, affordable financial services is a recognized determinant of financial well-being. Recent financial technology (fintech) innovations have lowered barriers to financial services for PEH, but the industry's rapid, under-regulated expansion into high-cost loan products poses new risks of financial exploitation for this already-vulnerable population, including communities of color who are disproportionately unbanked. This study aimed to characterize the financial management practices and financial service use of PEH in the city of New Haven, CT, identify unmet needs, and inform practice, policy, and regulatory responses.

Methods: A cross-sectional, primarily quantitative survey supplemented by qualitative data was conducted with 66 adults currently or recently experiencing homelessness in New Haven, Connecticut (June–August 2024). Participants were recruited from public congregating sites (library, railway station, soup kitchens) and through community connections. The survey, adapted from the FDIC National Survey of Unbanked and Underbanked Households and building on prior related research by the same researchers, assessed use of banks, credit unions, prepaid cards, and fintech apps; five-year debt history; and financial goals. Quantitative data were analyzed descriptively using frequencies and cross-tabulations. Twenty-two explanatory qualitative interviews were conducted from July to December 2025; analysis of the qualitative data is ongoing. IRB exemption was granted by Yale University.

Results: Quantitative data showed that most participants earned less than $500/month (n=40/66), eight of whom reported no income at all. Three-quarters used at least one financial service: fintech apps (36%; e.g., PayPal, Venmo, CashApp) were most common, followed by prepaid cards (26%), traditional banks or credit unions (21%), and online banks (12%); 26% relied on cash only. More than half (56%) reported problematic debt in the past five years, including overdraft fees, credit card balances, utility arrears, and pawned items. Initial findings from qualitative accounts suggest that PEH in New Haven experience significant exclusion from traditional banking services and employment, and reliance on work under the table, cash, and fintech services.

Conclusions and Implications: PEH are active but precariously situated participants in the financial services landscape, relying primarily on fintech at a moment when that industry is moving rapidly into high-cost, poorly regulated loan products. Supporting PEH to access safer options—including low-fee, BankOn-compliant accounts for those with sufficient income—should be part of service provision, but individual-level support alone is insufficient. Stronger regulation of fintech lending is urgently needed; the ongoing rollback of Consumer Financial Protection Bureau oversight makes this more pressing. While safe and affordable financial services alone will not prevent homelessness, it is one critical element in a constellation of structural contributors. Larger, geographically diverse mixed-methods studies would help clarify where interventions can make the most difference.