As a result of declining interest rates on certificates of deposit. many of your valued customers have closed their accounts in search of instruments that pay a higher yield. If you have alternative investment products available, then your customers are likely to remain with the bank.

Deposit erosion is also caused by older customers who spend huge sums for long-term care, such as extensive stays in a nursing home. Such costs can range from $30,000 to $80,000 per year. In 1992, costs for nursing home care reached $50 billion dollars; costs for home care of the elderly reached $ 1 0 billion.

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