Omaha daily bee., 1885-05-14
SAVING OF SMALL U
The Practice in Its Infancy In the
West as Compared with the East.

Chicago News.
1.-THE practice of taving up small sums
for q rainy day Is yet In Its infancy In the
west" said w. Kelsey Reed, treasurer
Of the Dime savings bank, to a Daily
News reporter, who had asked for infor.
regarding the subject. Soon
pared with the poorer classes of the east
ern states" continued the treasurer,
''the working people of the west really
do not save at all. By working people,
| do not refer to the laborer and artisan
particularly, but to that vast army OF
In all classes of life who depend
their daily labor for a llving-the
mechanic, the ~bookkeeper, teacher,
clerk, and small store-keeper; the
seamstress, shop-girl, and washerwomen,
whose earnings are from 50 to So q
week. They do not rave, and yet this Is
one of the great manufacturing centers
of the country. There are now only two
savings institutions In Chicago, strictly
speaking; the Dime and the Home; all
the others have failed since the fire of
1871, and their history is too fresh In the
memory of the people for me to partlcu-
larize. These repeated failures have
caused the people to become shy about
depositing their dimes In savings banks;
and no wonder. All were mere stock
banks, run for profit, and no security
given to depositors that their money
was safe. The managers of the banks
took the money In charge for the pur.
pose of making money themselves. They
offered o certain amount of interest, often
much higher thsnlcould be afforded, and
when they failed, the poor lost every
thing. My experience teaches me that a
high rate of interest is not wanted by the
poor who intrust their hard earnings to
the kicking of a bank. They want
only the assurance that 1t Ia safe
that they can get it when nee1ed-that
is all; and this guaranty of safety they
can not get under the system governing
stock banks. The law regulating the
savings banks In New York state has
proved 30 successful that there is abso-
lutte confidence reposed In them by the
poor, and the deposits reach into the
hundred millions, where in Illinois,
having no law, they barely touch a mil
lion. The total number of pass books
Issued In this bank since Its organization
In 1869 Ia 10, 496, and now we have about
three thousand regular depositors, who
have not more than 500, 900 to their
credit. Only one of these has as
much as So, 900 in bank, the remaining
Q, 999 have sums ranging from $500 down
to $50, and the vast majority show the
latter sum as the total of their savings.
Quoting from the last report of the st tate
superintendent of the New York Savings
banks, we get the astounding figures of
$50 900, 900 on deposit In the New York
Savings bank and $40, o00, 600 In the
Bowery Savings bank. The latter shows
that 800 depositors have $4,000 to their
credit, the limit allowed by the state law
than any one bank can take
from a single individual. There
Is not a dollar of capital
stock In these banks; they are under the
supervision of a board of trustees, who
are bound by law to serve without pay,
and they In turn must make a certified
report to the state superintendent once a
year. The trustees can only invest the
money In their care In a certain pre-
scribed way, viz: In stocks or bonds Of
the United States; In stocks or bonds of
the home state; In bonds of any other
state that has not been defaulted in the
payment of interest within ten years; In
city, county and town bonds, and in first
mortgages on approved real estate. All
the expenses of Office building, clerk hire,
and salaries Of the officers of the bank are
paid cut of the accrued interest, and the
balance is applied on the deposits pro
rata, in the nature of q dividend. The
system Is known az the mutual and is
the only method calculated to attract the
earnings of the poorer and industrial
classes"
Further inquiry regarding the extra
ordinary success attained by saving in.
situations in the east developed the fact
that In 1883 there was deposited to the
credit of working people in 127 savings
banks In New York state the magnificent
sum of $4l2, 147 1913; in Massachusetts,,
In 166 banks, $241, $50, 773, against ST..
192, 1913 in Illinois. Mr.. Reed was of
the opinion that it was not apathy, but
distrust, that caused such a vast discrep-
ancy, and vera the people assured Of
some degree of safety in the investment
of their money, as well as faith In the
integrity of the management, the total
deposits would rapidly increase to a
respectable figure. The failure of saw
ipgs banks when operating under the
general banking laws Of this state has
not passed unnoticed, and a bill based on
the New York mutual system Is now
pending in the state Legislature, and ia
confidently expected to pas, when II
comes up. 1t has the endorsement OF
the presidents of the leading national
and state banks In Chicago, and many
prominent merchants, including Mar
shall Field, j. w. Doane, and N. X.
Fairbank.
1t Is the aim OF the Dime savings bank
to conform as far as possible to the plan
of the mutual system, and 1t does not
therefore enter much into a general bank.
Ing business, perferrlng moderate returns
to taking risks that would jeopardize the
interests of depositors. Its aim is to fos'
ter the principle of thrift and economy
among the handwriting poor, gusran'
teeing a safe rate of interest, and point
ing out, when requested, how to make
good Investments for accumulated saw
ings.
Some interesting stories are told of the
methods adopted to prevent come of the
young depositors from squandering their
money. A lad of IL years once started
an account with the avowed intention of
saving up So only, which he proposed to
invest in skates. This was before the sd-