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Miami Herald
19 minutes ago
- Miami Herald
Miamians save less money than other big-city residents. Here's why
Of the U.S.'s 10 largest metropolitan areas, greater Miami residents are among the least able to save their earnings. The average South Floridian spends roughly 77% of their pre-tax income, according to 2023 data from the U.S. Bureau of Labor Statistics, the agency's most up-to-date statistics. Only the residents of greater Houston and Phoenix are, on average, less able to save than their Miami counterparts. It figures. Since the pandemic, out-of-state wealth has flooded into Florida, and particularly greater Miami, whose population of millionaires nearly doubled between 2014 and 2024. That influx of money has driven up local prices, especially for housing. Meanwhile, local workers' wages have lagged, so much so that more than half of Miami households are living paycheck to paycheck. And the money they do have overwhelmingly goes toward housing. Many of those households that have little ability to squirrel away funds are in vulnerable positions when emergencies strike, noted David Andolfatto, chair of the University of Miami's economics department. Ultimately, that limits their ability to save for long-term goals, like paying for college or buying a house, and to respond to crises, like a health emergency, job loss or destructive hurricane. Why so little savings? The average Miami area household spends $71,000 per year, according to the Bureau of Labor Statistics. Roughly 37% of that spending goes toward housing. Across the country's 10 largest metro areas, only New Yorkers spend as much. Roughly six in 10 people living in metro Miami — which includes Miami-Dade, Broward and Palm Beach counties — spend more than 30% of their monthly income on housing. A third spend at least half of their earnings on rent. Miami is now the most rent-burdened metropolitan area in the United States. That's likely a major reason people are so unable to save, said Shari Bower, vice president and regional director at the Federal Reserve Bank of Atlanta, which covers Florida. 'Miami is one of the least affordable places to live in the U.S., both looking at rents and home prices,' she noted. South Florida's economy is heavily reliant on tourism, added Bower, which means a relatively high share of metro-area jobs are in lower-paying service sectors — another local dynamic that makes it harder for residents to set money aside. Then there are the demographic considerations. South Florida has a sizable retired population, many of whom live on fixed incomes and are spending any savings they might have, said Andolfatto, the University of Miami economist. It also has a large immigrant population. Nearly four in 10 people living in greater Miami are foreign born. Many of them likely send a good chunk of their income back to family overseas, said Bower, leaving them less to save. But generally, she said, greater Miami's relatively low saving rate is most 'likely due to the high cost of living.' That extends beyond just housing. Miami's other chart-topping expenditure: transportation. More than a fifth of the average household's budget is dedicated to getting around — the highest share among major U.S. metro areas, tied only with Houston. Other major expenses as percentages of average household spending include food (12%) and healthcare (6%). And recent proposed cuts to federal spending, including on food stamps, Medicaid and housing subsidies, could further diminish households' abilities to save. 'I sometimes think people are what we call penny-wise, pound foolish,' quipped Andolfatto, noting that a lack of financial cushion doesn't just affect individuals. When people are unable to build even modest savings, they're left more exposed to financial shocks, like unemployment or medical emergencies or hurricanes. And when those shocks hit, the costs can spill over onto the broader public — think, the burdens placed on hospital or criminal justice systems when they process homeless people. Or, noted Andolfatto, the security costs that accompany rising crime, when individuals are in desperate situations and do what they need to do to survive. 'Society is going to pay the price, one way or another,' he said. This story was produced with financial support from supporters including The Green Family Foundation Trust and Ken O'Keefe, in partnership with Journalism Funding Partners. The Miami Herald maintains full editorial control of this work.
TechCrunch
36 minutes ago
- TechCrunch
Stripe's first employee, the founder of fintech Increase, sort of bought a bank
It's an open secret in the fintech world that the founder and CEO of startup Increase, Darragh Buckley, has been trying for years to 'buy a bank,' as one person familiar with the landscape told TechCrunch. A couple of weeks ago, he basically succeeded. He bought a big enough stake in Twin City Bank to trigger a public disclosure of the transaction by the Federal Research Board. Such share purchases are then subject to FDIC approval. Twin City is a small community bank in Longview, Washington, about an hour north of Portland, Oregon. The stake had to be in excess of 10% to trigger the disclosure. Buckley confirmed the deal to TechCrunch but declined to say how big of a stake he purchased. Whether he owns 11% or, say, 51%, we understand he is not the sole owner. Still, anything upwards of 10% makes him a major shareholder. (For comparison, public companies have to disclose all ownership stakes of 5% or more.) The assumption in the industry was that Buckley wanted a bank to further the ambitions of Increase, his banking-as-a-service (BaaS) startup, multiple sources told TechCrunch. What's particularly wild is that a mysterious entity — most likely one of Buckley's competitors — was so opposed to this deal that it hired an agency to pitch the press on writing negative stories about it and him. But, Buckley told TechCrunch, this was actually his third investment in a Washington community bank and his interests are not what his competitors think. Techcrunch event Save $450 on your TechCrunch All Stage pass Build smarter. Scale faster. Connect deeper. Join visionaries from Precursor Ventures, NEA, Index Ventures, Underscore VC, and beyond for a day packed with strategies, workshops, and meaningful connections. Save $450 on your TechCrunch All Stage pass Build smarter. Scale faster. Connect deeper. Join visionaries from Precursor Ventures, NEA, Index Ventures, Underscore VC, and beyond for a day packed with strategies, workshops, and meaningful connections. Boston, MA | REGISTER NOW This is not an effort for Increase to own the bank, he said. 'Twin City Bank is, and will remain, a community-focused bank,' he said. Silicon Valley finds a banking shortcut Increase offers an API platform that allows financial services to be programmatically served. It performs tasks like automated clearing house transactions, wires, real-time payments, etc. Increase's customers are largely other fintechs like Ramp, Check, and Pipe. As Stripe's first employee, Buckley has 'a great reputation as an engineer among his peers,' one person in the fintech industry told TechCrunch. Even some BaaS competitors refer business to Increase when they can't handle it themselves. Like most fintechs, Increase partners with (and shares revenue with) FDIC-insured banks to offer such regulated services. Obtaining banking licenses themselves is difficult and expensive. Even Chime, which offers checking and savings accounts and recently had an IPO, is not an FDIC-insured bank but has banking partners. In Increase's case, it works with Grasshopper Bank and First Internet Bank of Indiana. (Buckley said he has no personal investment in either one.) However, BaaS is a crowded, competitive market. That's led a small number of them to find a workaround to stand out: buying small community banks directly and doing away with banking partners. The biggest example of this is William Hockey, co-founder of Plaid, whose current fintech, Column, bought Northern California National Bank for $50 million in 2021. Another example is a Kansas City bank called Lead, bought and led by former Block executives Jackie Reses, Lead's CEO, and Ronak Vyas, CTO. The dangers of fintech partnerships Buckley insists he has no plans to turn Twin City into his company's personal partner bank or to swell its revenues with lots of fintech partners like Increase's customers. The latter, he knows, can be dangerous. For example, Evolve Bank, a partner to many fintechs from Affirm to Stripe, was the target of a large ransomware attack in 2024. This was shortly after the Federal Reserve System issued a cease-and-desist consent order to Evolve over problems it found with the bank's risk management systems. Evolve was ordered to implement pages of compliance fixes. (The bank was also associated with the meltdown of BaaS startup Synapse.) 'Twin City Bank shouldn't support sponsor banking,' Buckley explained, referring to banking partnerships with fintechs. 'Sponsor banking requires very specific capability and capacity to supervise partners safely and soundly. Only specialized banks should do it.' So why make such a big investment if not to benefit Increase? Because he likes community banks. They are the underdogs of the banking world. 'There's perhaps a prevalent view in the financial technology industry that community banks can't grow on their own. But community banks' strength is their relationships and knowledge,' he said. If Buckley's plan for the bank ever changes, his BaaS competitors will be watching. As for the mysterious entity hoping to stop him: it's too late. He said he received the FDIC's 'non-objection for control' approval and the deal has already closed.
CBS News
40 minutes ago
- CBS News
House passes "big, beautiful bill," sending it to Trump's desk in 218-214 vote
Washington — The House on Thursday passed the signature piece of legislation of President Trump's second term, approving a massive bill that includes trillions of dollars in tax and spending cuts while ramping up funding for defense and the administration's immigration agenda. The lower chamber voted 218 to 214 to approve the measure, with two Republicans — Reps. Thomas Massie of Kentucky and Brian Fitzpatrick of Pennsylvania — joining all Democrats in opposing the bill. The Senate passed the legislation, dubbed the "big, beautiful bill," earlier this week. The House vote tees up President Trump to sign the bill as early as Friday, coinciding with the July 4 holiday. The vote came after a marathon overnight session that saw GOP leaders overcome internal opposition to advance the bill, paving the way for final passage. Republican members who balked at many of the changes the Senate made to the legislation eventually relented and voted to pass it. House Democratic Leader Hakeem Jeffries tried to delay the inevitable by speaking on the floor for 8 hours and 44 minutes, setting the record for the longest House speech in U.S. history. He called out Republicans for the bill's deep cuts to Medicaid and food assistance programs, highlighting the Americans who he said would suffer because of the bill. Before the vote, Speaker Mike Johnson said the bill will "make this country stronger, safer and more prosperous than ever before, and every American is going to benefit from that." "We've had spirited debate, we've had months of deliberation, and now we are finally ready to fulfill our promise to the American people," Johnson said. "That's what we are doing today." The nonpartisan Congressional Budget Office estimates the bill would add $3.4 trillion to federal deficits over the next 10 years and leave millions without health insurance, due to the cuts to Medicaid and programs under the Affordable Care Act. It would also dramatically increase funding for immigration enforcement, a key priority for Republicans and the president. GOP opposition melts away House members vote on President Trump's tax bill at the Capitol on July 3, 2025. ALEX WROBLEWSKI/AFP via Getty Images The final vote came after House GOP leadership scrambled Wednesday and into the wee hours Thursday to shore up support for the measure ahead of a key procedural vote. Although Johnson spent weeks pleading with his Senate counterparts not to make any major changes to the version of the bill that passed the lower chamber by a single vote in May, the Senate made a number of tweaks that irked House members on a number of fronts — from its cuts to Medicaid to its impact on the deficit. Johnson acknowledged that the Senate bill's changes "went a little further than many of us would've preferred," though he repeatedly urged that the final product was largely what the House had signed off on in May. The Senate-passed bill includes steeper Medicaid cuts, a higher increase in the debt limit and changes to the House bill's green energy policies and the state and local tax deduction. Other controversial provisions that faced pushback in both chambers, including the sale of public lands in nearly a dozen states, a 10-year moratorium on states regulating artificial intelligence and an excise tax on the renewable energy industry, were stripped from the Senate bill before heading back to the House. Potential holdouts, including moderates and members of the conservative House Freedom Caucus, met with Mr. Trump on Wednesday as the White House pressured House Republicans to vote for the bill. The vote on the key procedural hurdle began around 9:30 p.m. Wednesday and didn't wrap up until about 3:20 a.m. Thursday. Five House Republicans initially voted no on the vote setting the rules for debate on the measure, which would have been enough to tank the vote. But the vote remained open as GOP leaders worked to shore up support, allowing lawmakers to change from no to yes. Johnson told reporters that Mr. Trump was "directly engaged" with skeptical members to get them onboard. "Members wanted to hear certain assurances from him about what's ahead, what the future will entail, and what we're going to do next, and all of that," Johnson said. "And he was very, very helpful in that process." Mr. Trump ramped up the pressure over Truth Social as a handful of Republican holdouts didn't appear to be budging, declaring: "FOR REPUBLICANS, THIS SHOULD BE AN EASY YES VOTE. RIDICULOUS!!!" "What are the Republicans waiting for??? What are you trying to prove??? MAGA IS NOT HAPPY, AND IT'S COSTING YOU VOTES!!!" Mr. Trump wrote shortly after midnight. The House ultimately voted 219 to 213 to advance the bill in a key victory for Republican leaders, who won the support of about a dozen GOP opponents to the rule. And when the vote finally came to an end, Fitzpatrick was the sole Republican opposed. He would also vote against final passage. Johnson told reporters that the breakthrough came amid help from the president, along with lengthy listening sessions with the bill's opponents, "making sure that their concerns were addressed." "A lot of people had to take the time to thoroughly go through the Senate's changes to our bill and that's fine," Johnson said. "That was necessary to get them to yes." , and contributed to this report.
