New York University’s Financial Access Initiative (FAI), Bankable Frontier Associates (BFA) and The Center for Financial Services Innovation (CFSI) will track more than 200 families in four geographic regions (with 10 distinct demographic profiles) in the U.S., over the course of a year, and collect highly detailed data on household financial activity. The landmark study promises a timely and independent look at how low- and moderate-income Americans are managing their financial lives.

The Financial Diaries methodology, which will be used to conduct this research, has been successfully applied in Bangladesh, India and South Africa. The results are detailed in the groundbreaking book Portfolios of the Poor: How the World´s Poor Live on $2 a Day (Princeton University Press, 2009), which has been instrumental in broadening conceptions of global poverty.

This methodology of regularly observing household finances over long periods of time allows researchers to identify often-overlooked strategies of financial management, such as the use of informal borrowing and lending with neighbors and family members. The study is designed to capture spending and savings habits that often remain hidden in large surveys. The study will take place in Cincinnati and surrounding areas, Northern Kentucky, Eastern Mississippi, San Jose and surrounding areas, Queens, and Brooklyn. Sites have been chosen to ensure geographic, ethnic, and racial diversity of households and urban/rural communities. The findings will be published in a series of reports beginning in mid-2012.

In the U.S., the Federal Deposit Insurance Company (FDIC) found that some 17 million adults live in households without any bank accounts. Another 43 million adults have accounts but are “underbanked,” relying on non-bank services such as pay-day lenders and pawn shops. Taken together, about 30 million households are unbanked or underbanked. Yet, there is little concrete data about the needs, preferences and use of financial services by low- and moderate income families.

“Remarkably, more than 30 million low-income families across the U.S. lack access to traditional banking and financial systems,” says Frank DeGiovanni, director of financial assets at the Ford Foundation. “This landmark study will help us to better understand their financial lives, greatly improving the ability of the financial industry, nonprofits, and policymakers to meet their needs and increase the quality, affordability, and accessibility of financial services.”