The Amish have a complex relationship with banks and modern finances. Here is a quick overview of how Amish approach banking and financial services:
Quick Summary
- Most Amish use some banking services, but avoid debt and loans.
- Amish values of separation from worldly institutions and financial caution limit banking usage.
- Some Amish work with local banks for basic services like checking and savings accounts.
- Amish avoid credit cards, mortgages, insurance and other loan-based financial products.
- Amish often use cash, buy with savings or borrow from their community to make large purchases.
- A small minority of Amish completely reject banks as too worldly.
While practices vary across Amish communities, most Amish do use some basic banking services while avoiding debt-based financial products antithetical to their values. Their approach reflects broader Amish beliefs about separation from mainstream institutions and financial prudence.
Amish Values Limit Banking Usage
At first glance, it may seem that the Amish would reject any use of modern banking. Amish life is centered on separation from mainstream society and technology. Amish values of community, simplicity, and tradition seemingly conflict with the complex world of modern finance.
However, the Amish relationship with banking is more nuanced. Their decisions about finances reflect two key values:
- Separation from the world – Amish shy away from deep integration with worldly institutions like banks.
- Financial caution – Amish avoid debt and risky financial products.
These values lead most Amish to use banking services selectively. They will use banks when necessary but avoid debt or extensive engagement with financial institutions. A few very traditional Amish groups reject banks entirely, while more progressive Amish might have greater comfort with banking.
Separation from the World
Amish beliefs encourage separation from mainstream society. Amish worry that too much integration with worldly institutions could erode their community. Banks, as pillars of the modern economy, often fall into the category of institutions the Amish seek to avoid.
This wariness means few Amish would choose to work in banking. Amish also hesitate to rely heavily on banks for their personal finances. Some traditional groups see banks as a threat to separation from the world and eschew bank usage altogether. More progressive Amish are sometimes willing to engage more fully with banks if useful.
Financial Caution
Amish also value self-sufficiency, saving, and avoiding debt. Taking out loans or mortgages violates Amish financial values. Gambling through investments and insurance also conflicts with Amish ideals of stewardship.
This financial caution limits Amish willingness to use bank products based on credit, loans, or risk. Amish seek to live within their means, save for large purchases, and borrow from their community when needed. Products encouraging debt do not appeal to most Amish.
Basic Banking Services
Many Amish have basic bank accounts for transactions, while avoiding debt-related services.
Regular checking and savings accounts are acceptable to most Amish. These allow them to deposit funds, access money, and pay bills without relying on cash alone. For example, some Amish farmers use bank accounts to receive payments and pay suppliers.
Amish typically avoid products like credit cards, loans, mortgages, and insurance. They do not want to incur interest and debt. While they use basic bank accounts, Amish remain wary of extensive entanglement with banks.
Checking and Savings
Many Amish use simple checking and savings accounts at local banks. This provides them with:
- A place to deposit funds and keep savings secure
- Access to money without keeping large amounts of cash at home
- The ability to write checks to pay bills rather than use cash for every transaction
For example, an Amish farmer may deposit milk sale proceeds in a bank account. He can then write checks to pay for animal feed, equipment repairs, and other expenses. This basic banking facilitates commerce without debt.
Aversion to Debt Products
While using basic accounts, most Amish avoid loan-based services like:
- Credit cards
- Mortgages
- Car loans
- Home equity loans
- Insurance
- Commercial loans
These products represent debt, risk, and unnecessary entanglement with the world. They violate Amish financial values even though they facilitate commerce in mainstream society.
A few progressive Amish might bend these rules, but most adhere closely to this avoidance of debt. Amish do not want bank debt or related obligations.
Purchasing Without Loans
Since they avoid bank loans, how do Amish pay for major expenses?
Amish have developed several strategies to save up to pay cash for large purchases. They also borrow from within their community to cover rare emergencies or big investments in their family livelihoods.
Saving Up Over Time
The primary Amish strategy is to save up over many years to buy expensive items with cash. Some examples include:
- Homes – Amish gradually build up savings over a decade or more to afford a home without a mortgage.
- Appliances and furniture – Similarly, families slowly save up to buy home furnishings and appliances outright.
- Vehicles and equipment – Amish businessmen save up to buy inventory, vehicles, livestock, and equipment in cash rather than taking loans.
This requires patience and discipline. But it allows major purchases without debt. Amish absorb the opportunity cost of waiting longer to acquire items. But avoiding debt provides greater long-term security and aligns with their values.
Borrowing from Community
For rare situations, Amish may borrow from members of their community. Reasons include:
- Covering emergency expenses from illness or accidents
- Investing in equipment to expand a family business
- Helping a newly married couple acquire a home
Since these loans come from other Amish, they often have flexible terms and avoid compound interest. This maintains community interdependence and meets urgent needs. But Amish still minimize such community borrowing to avoid long-term debt.
Small Minority Rejects Banking Entirely
A small minority of Amish completely shun banks. This practice is most common among Ultra-Conservative Amish groups in settlements like Holmes County, Ohio.
These Amish argue banks are pillars of the immoral mainstream world. Banking encourages greed and financial risk-taking. Ultra-Traditional Amish believe avoiding banks entirely keeps them separate from worldly society.
These Amish use only cash for transactions. They keep excess funds as cash at home or in stable forms like livestock. By avoiding banks, they maintain stricter separation but sacrifice financial convenience and safety.
Banking Seen as Too Worldly
For the most traditional Amish, any usage of banking is too integrated with the mainstream. Their philosophy is to:
- Minimize handling of cash
- Convert excess funds to productive assets like farmland immediately
- Borrow from community members when absolutely necessary
They believe this approach aligns closest with Amish values of separation, community, and discipline. Banks represent engagement with worldly institutions, which should be avoided.
Financial Challenges
Avoiding banks entirely creates practical challenges including:
- Greater physical security risks from keeping cash at home
- Less ability to earn interest on savings
- No credit history to get community loans if needed
- Difficulty receiving customer payments efficiently
These Amish accept these difficulties as part of maintaining strict separation from the non-Amish world. Their minority approach reflects the deepest Amish aversion to financial institutions.
Table Summary
This table summarizes key Amish beliefs about using mainstream banking services:
| Banking Practice | Amish Acceptance | Rationale |
|---|---|---|
| Basic checking/savings accounts | Accepted by most Amish | Help conduct transactions and save without debt |
| Credit cards | Rejected by most Amish | Incur debt and interest |
| Mortgages | Rejected by most Amish | Incur debt and interest |
| Commercial loans | Rejected by most Amish | Incur debt and interest |
| Insurance policies | Rejected by most Amish | Involve risk and worldly institutions |
| All banking | Rejected by Ultra-Conservative Amish | Too integrated with worldly system |
Variations Between Amish Communities
Amish practices vary across different Amish communities and church districts. Some general patterns include:
- More progressive communities allow greater bank usage
- Stricter groups only use banks minimally if at all
- Higher Amish populations in an area support more Amish-run banks
- Amish banks help accommodate religious restrictions on banking
Understanding these community differences helps explain why Amish banking practices are not uniform.
Progressive Communities
The most progressive Amish communities tend to have more comfort with mainstream banking. For example, New Order Amish in Lancaster County, Pennsylvania have greater openness to modern practices than older Old Order groups.
These progressive Amish may utilize more extensive business loans, insurance, and other financial products to grow their enterprises. They interpret separation from the world less stringently than stricter districts.
Strict Communities
At the other end of the spectrum, ultra-conservative Swartzentruber Amish and others reject banking entirely. Conservative groups like Swiss Amish also limit banking to basic functions like checking accounts.
These communities stress strict separation from the non-Amish world. They are most likely to buy with cash or borrow only from each other.
Amish Banks
Some communities with heavy Amish populations have special banks catering to the Amish. For example, Amish communities in Ohio and Indiana have founded their own banks or credit unions including:
- Farmers Bank in Baltic, Ohio
- Community Bank in Sarasota, Florida
- Amish Helping Fund in Lancaster County, Pennsylvania
These Amish banks understand and accommodate Amish faith traditions. Their Amish board members ensure adherence to community values. This expands financial options for Amish without undermining beliefs.
In areas without Amish banks, Amish stick to cash or basic mainstream bank services. But Amish banks allow fuller banking engagement where available.
Conclusions
Most Amish engage cautiously with banks. While utilizing basic accounts, they avoid debt-based products and unnecessary worldly entanglements. A small minority shun banks entirely as incompatible with Amish values.
Amish banking decisions reflect their ideals of separation, community, and financial discipline. Their nuanced approach maintains core values while pragmatically facilitating financial transactions. Amish banking practices remain distinct from mainstream society, like Amish life itself.