CU ONE employee still working--at 90

FERNDALE, Mich. (6/26/08)--Harry Nowell, an employee of Credit Union ONE in Ferndale, Mich., will turn 90 on July 8.

Nowell is a "joy and inspiration to those around him," Judi Desiletes, assistant to president/CEO Gary Moody, told News Now.

Nowell works 20 hours per week at the credit union in the mail processing center, sorting and distributing all of Credit Union ONE's mail. He also still drives himself to work.

Nowell, who was born in Montreal, Quebec, joined the credit union in 1981--his third career in a lifetime. He worked in the purchasing and facilities departments, but has worked in the mail processing center for the past 10 years.

He came to the U.S. when he was eight years old and acquired his citizenship as a young adult. He graduated from Central High School in Detroit and established residence in Ferndale, Mich., after marrying his wife, Elizabeth, in 1941. They have eight children, 11 grandchildren and six great-grandchildren.

He worked for Ford Hospital from 1946 until he retired as assistant to the chief of maintenance in 1986.

He then managed a manufacturing facility in Davison, Mich. He retired--again--in 1981, returned to the Detroit area, and started work at Credit Union ONE.

Nowell and his wife earned Volunteers of the Year Awards several years ago. Nowell volunteered for the Red Cross Mobile Blood Bank, Ford Hospital, Providence Hospital, St. Joseph Oakland Hospital and Beaumont Royal Oak Hospital.

He enjoys spending time with his family, visiting his summer home in Beulah, Mich., and cheering on his favorite sports teams--the University of Michigan and the Detroit Tigers.

courtesy of cuna.org

Teenagers learn the importance of saving by spending

MADISON, Wis. (6/26/08)--Teenagers learned they needed to spend less than they earned at a Mad City Money simulation sponsored by Credit Union National Association's (CUNA) center for personal finance.

The event was one of the elective classes for youth at the Wisconsin 4H Leadership Conference. Students from an investing class at Madison, Wis.'s Edgewood High School joined the group.

More than 50 teenagers received an identity that included an occupation, a family, and a set monthly income. Debt--both credit card and school loan--were included in their mythical future.

With calculators in hand, the students visited eight Mad City merchants to purchase housing, transportation, household goods, child care, clothing, entertainment and more. A credit union provided financial counseling. Chance played a role in the form of the Fickle Finger of Fate, which delivered unexpected expenses such as a flat tire or broken eye glasses and windfalls such as winning a local karaoke contest or hosting a successful garage sale.

"The power of a simulation is much greater than a school lecture or advice from Mom and Dad," said Lin Standke, manager of youth programs for CUNA. "We take money seriously, but that doesn't mean that learning about it can't be fun. This was an opportunity for the teenagers to experience for themselves the effects of making bad money decisions.

"You can see those mental light bulbs click on when students discover that the buying an expensive house and a luxury truck means they can't afford food or diapers for their kids. This is a realistic, non-boring way for them to learn how to make choices about money."

One student summed up the activity: "Now I will spend my money wisely and think carefully about what I need and then go with some wants. And when I need help, I will come to the credit union."

Another student put it in succinct teen speak: "I'm gonna save my butt off!"

courtesy of cuna.org

In the Media: Maine CUs tell it like it is

BANGOR, Maine (6/26/08)--Maine credit unions, a member, and the Maine Credit Union League educated readers of The Maine Edge.com about the credit union difference in an in-depth article Wednesday.

The article began with Brewer (Maine) FCU member Mike Curran. Curran told the newspaper he likes his $37.5 million asset credit union for its simplicity, convenience of location, and the financial services--and for recognizing him every time he visits the branch. He preferred a small institution that can't be bought.

Bangor FCU President/CEO Stephen K. Clark talked about the democratic, cooperative structure of credit unions, which represents "a much different model than the conventional stock ownership of most banks."

Bucksport-based Seaboard FCU CEO Kyle Cashburn described the difference in for-profit (where the company maximizes the financial return for stockholders) and not-for-profit (it maximizes the financial return for its member owners) businesses.

Richard Kaul, president/CEO of Brewer FCU, noted credit unions' rich history based on urban financial cooperatives in Germany and credit unions' service to people of modest means. He also said credit unions are expanding to serve small businesses. "The backbone of Maine's economy is moms and pops," Kaul told the newspaper.

Jon Paradise, spokesman for the Maine Credit Union League, discussed the growth in popularity the credit union industry has seen in the state and why credit unions are popular. About half of the state's population belongs to a credit union, he told the newspaper.

As cooperatives, credit unions are exempt from state and federal income taxes and return excess profits to their members, Paradise said, noting the constant battle with banks.

Also discussed: field of membership growth and expansion through technology and shared branching; credit unions cooperation with each other in shared branch networks,, and credit unions' cooperative nature meaning combining.

The article noted credit unions' collaboration, concluding that "all who were interviewed shared a common belief in community...but also a camaraderie among seeming competitors not normally found in any industry."

courtesy of cuna.org

Less driving may mean insurance savings

NEW YORK (6/25/08)--As the price of gasoline reaches record highs across the country, millions of Americans are finding ways to cut back on driving to save money. What drivers may not know is they may be eligible for lower insurance rates as a result of driving less (The Wall Street Journal June 12).

Whether it's from combining errands, biking or carpooling, a recent study by the Consumer Federation of America (CFA) found that Americans who cut back on driving can save up to 15% on auto insurance. According to the study, the average auto insurance premium in the U.S. is $830, so a savings of 15% could mean more than $120 back in your wallet.

Insurance rates are based on several factors, one of which is the number of miles you drive. If you've stopped driving to work, CFA estimates your insurance costs may drop 10% to 15%. If you now only drive partway to school or work, your savings may average 5% to 10%. And even if you've simply cut back on errands or consolidated your driving, you still may be eligible for a rate cut.

J. Robert Hunter, director of insurance for CFA, recommends you call your insurance company and ask if you qualify for an immediate rate reduction (consumerfed.org June 10). Savings will vary depending on your coverage, but it never hurts to check on it.

If you call your auto insurance agent, be prepared to make your case. Explain what you're doing to drive less, and estimate the number of miles you save each month.

For more information, read "Finding Extra Savings on Auto Insurance" in Home & Family Finance Resource Center.

courtesy of cuna.org

Workers' comp experts tout benefits of education

HOLLYWOOD, Fla. (6/24/08)--A commitment to safety and health in the workplace from top management and a proactive return-to-work program can help prevent workplace injuries and reduce the duration and cost of disabilities, workers' compensation experts told credit union attendees at the Discovery Conference Friday.

Experts included Jim Hunt, underwriting specialist, CUNA Mutual Group credit union protection division; Kurt Salter, account consultant, national market loss prevention, Liberty Mutual; Paul Bedrosian, service director, Liberty Mutual; and Fred Filiaggi, Midwest loss prevention manager, Liberty Mutual.

"Top management, supervisors, and all employees play a critical role in injury prevention," Salter said. "Identifying causes for common workplace injuries and taking steps to mitigate those risks can greatly decrease incidents of injury."

Injuries caused by overexerting oneself through excess lifting or pushing was the most common cause of disabling workplace injuries in 2005, according to research by Liberty Mutual. CUNA Mutual's claims data supports the findings, Hunt said.

Employees moving 50-pound bags of coins often use two-wheel hand trucks. Those don't work well, because bags tend to roll onto the floor. Dropped bags require employees to bend over and pick them up--which results in back and shoulder problems. The solution is to use low-profile, four-wheel carts and educate employees on proper posture and lifting techniques.

Educational resources, such as CUNA Mutual's Workers Safety Web page, should also be used, Salter said.

When injuries occur, a supervisor's response can play a key role in helping employees return to work, Filiaggi said. "Immediate response by supervisors to employees' reports of work-related discomfort significantly influences length of disability."

Negative supervisor attitudes and practices can impede return to work and rehabilitation for injured employees. Employees often perceived that their supervisors:

• Blamed the employee for the injury;
• Never contacted the employee after the injury;
• Didn't speak with the employee privately;
• Discouraged the employee from filing a claim;
• Didn't believe the symptoms were real;
• Were angry with the employee for being injured; and
• Didn't try to work out solutions with the employee.

Supervisors responding positively to reports of work-related discomfort can have significant and independent effects on disability outcomes, Filiaggi said. "It's very important to communicate regularly and positively with employees. Show them that you care, encourage them and tell them you look forward to their return to work."

Supervisors trained to properly respond, communicate and problem-solve with employees reduced new disability claims by 47% and active lost-time claims by 18%.

"Credit unions need to report claims quickly, help direct medical care and provide alternative duty to workers who can work, but can't yet do all the functions of their everyday job," he said.
CUNA Mutual and Liberty Mutual partnered in 2007. Liberty is a compensation insurance provider and the second largest workers' compensation insurer in the nation. The Discovery Conference ended Saturday.

courtesy of cuna.org

Flood victims: Where to go for help

MADISON, Wis. (6/23/08)--The devastating effects of floodwaters are taking a toll--both personally and financially--on city dwellers and farmers throughout the Midwest and beyond. If you have been affected by any natural disaster, know where to go for help.

The Credit Union National Association center for personal finance has compiled a list:

• FEMA. If your area is designated a disaster area by the president, do this first: Apply for assistance from the Federal Emergency Management Agency (FEMA) online at fema.gov (click "Apply for Assistance") or call 800-621-FEMA (621-3362). You must register to qualify for grants or low-interest loans. Have these items handy when you call: Social Security number, current and predisaster address, telephone number where you can be contacted, insurance information, total household annual income, and routing and account number from your financial institution if you want disaster assistance direct deposited to your checking account quickly. You'll also need to provide a description of your losses caused by the disaster. After you apply, you'll receive a FEMA application number; keep this number for future reference. It may take seven to 10 days for an inspector to arrive. Don't wait--begin the clean-up process as soon as you can. Keep receipts for repairs already made.
• U.S. Department of Agriculture Rural Development. Funding is available to help individuals and organizations affected by recent natural disasters in several states in the Midwest (U.S. Department of Agriculture June 16). Grant and loan funds provide assistance for housing and shelter, public safety, health care, and community facilities and business recovery assistance. For more information, visit rurdev.usda.gov.
• American Red Cross. RedCross.gov contains the latest news on current disasters, as well as links to disaster services, preparedness, blood services, volunteering, tips for military members and families, and more. Contact your local American Red Cross chapter or call 800-REDCROSS (733-2767).
• Salvation Army. Visit salvationarmyusa.org for links to current programs helping victims, or contact your local chapter.
• Your insurance agent. Discuss claims and be ready to document your personal belongings with photos, videotape, or lists if you have them. Ideally, this documentation should be in your safe deposit box or already on file with your insurance agent. For information about the National Flood Insurance Program, visit Floodsmart.gov.
• County health department. Officials can tell you of local disaster and health services, community health problems, and environmental health hazards.
• Local radio stations. Listen for road closures, food and water distribution sites, and other local aid services.

Anyone wishing to donate to disaster relief efforts can contact:
Red Cross: Call 800-HELP-NOW (435-7669) or visit redcross.org;
Salvation Army: Call 800-SAL-ARMY (725-2769) or visit salvationarmyusa.org; and
Local relief charities.

courtesy of cuna.org

Hampel warns Wall St. Journal: Spending will slow

NEW YORK (6/17/08)--Consumer spending and economic growth will slow toward the end of this year and into early next year, Bill Hampel, chief economist at the Credit Union National Association, told The Wall Street Journal Saturday.

"The pressures driving consumer spending down have not gone away at all," Hampel told the newspaper. "It's going to take awhile for the household sector to get out of this. We're looking for the economy to limp along [through mid-2009]."

While food and energy costs continue their upward spiral, prices of other items are being held back by a sluggish economy, which in turn will keep overall inflationary pressures, down, the article said.

The consumer price index rose 0.8% in May and is up 4.2% from a year ago, reflecting rising food, transportation and energy costs, the Labor Department said Friday, according to the article.

However, core prices--which exclude food and energy--went up 0.2% in May and 2.3% over the year. The figures indicated that underlying inflation remains constrained, although it is a little higher than the 1.5%- to-2% range preferred by the Federal Reserve, the article added.

courtesy of cuna.org

Variable pay programs more popular at CUs--Salary survey

MADISON, Wis. (6/17/08)--More credit unions are looking to variable pay programs to increase compensation without increasing base pay, as wage increases remain flat across the nation due to the economic downturn, says a new Credit Union National Association (CUNA) report.

Variable pay programs--which tie monetary rewards to performance measures and productivity--help credit unions keep salary expenses aligned with bottom-line results.

Although variable pay programs increased overall, bonuses remained the most common way to boost compensation, according to the 2008-2009 Complete Credit Union Staff Salary Survey, published by CUNA's center for research and advice.

Among credit unions with $1 million in assets or more, 62% offered bonus payments--rewards not tied to preset performance criteria--and 42% offered incentive payments--rewards tied to preset performance criteria--to their employees.

Management and nonmanagement employees were equally likely to be eligible for incentive payments, while management employees were more likely than nonmanagement employees to be eligible for bonus payments.

A little more than one-third of survey respondents reported that management and nonmanagement employees were eligible for incentive payments in 2007, while 59% of management and 48% of nonmanagement employees were eligible for bonuses. The percentage of credit unions offering bonuses to nonmanagement employees increased from 42% the previous year.

"The current economy and lack of wage growth are causing employees to experience higher financial stress than in the past," said Beth Soltis, senior research analyst for CUNA's center for research and advice. "In addition to incentive pay, credit unions may also want to consider adopting some non-monetary methods to compensate and inspire employees, like sabbatical days, development opportunities and flexible working arrangements.

The survey provides compensation data for 89 full-time and eight part-time positions at credit unions with $1 million or more in assets. The data include: base salaries, incentives, bonuses, total cash compensation, and salary ranges.

The report--available in print or Adobe PDF format--also contains job descriptions, benchmarks for salary and benefit expenses, base pay increases and turnover rates.

An electronic version of the survey's data tables is also available for purchase. This new offering allows users to apply formulas and insert the data directly into the credit union's spreadsheets.
Also available are CUNA's Geographic Customized Salary Survey and Online Peer Comparison. The customized geographic report provides average and median base salaries and percentile figures for selected cities or geographic areas.

The online peer comparison provides unlimited access to the 2008 salary survey database, which allows users to create customized peer groups using various criteria, such as: credit union name, asset size, number of members, field of membership, number of full-time employees, number of services offered, total loans outstanding, and geographic region. Customized report parameters include percentiles and date-specific trending.

For more information, use the resource link.

courtesy of cuna.org

Save time, money: Put payments on autopilot

MADISON, Wis. (6/16/08)--Streamlining your finances is a good idea anytime, but it's especially important when your budget is under pressure from high gas and food prices. A few simple changes can make a significant difference, and one change is to put your bills and other payments on autopilot, according to the Credit Union National Association center for personal finance.

The most recent Consumer Bill Payment Survey, sponsored by CheckFree Corp. and released January 2007, revealed that online payments made up 39% of all bill payments among online households.

Spend some time enrolling and setting up payees in exchange for these important benefits:

• Simplify bill payment. You won't be scrambling to find envelopes, stamps, and paper statements.
• Save time and money. If you pay 10 bills each month, that's more than $50 a year just for stamps, not to mention the time it takes to write the checks and deposit them in a secure mailbox.
• Avoid late fees. If you're prone to paying late, stay away from paper checks and snail mail (CNNMoney.com June 10). This also helps avoid credit-score dings.
  Schedule bills to be paid ahead of time. When you get the bill, you can designate when you want the bill to be paid and then forget about it.
• Automate recurring bills. If some of your payments are for the same amount each month, payable at the same time, schedule them to be automatically paid. If you have to evacuate your home for any reason, this feature helps ensure that your bills continue to be paid even if you're in temporary quarters elsewhere.
• Maintain flexibility. You can manage your payments from any computer at any time.
• Stay safe. You're more at risk paying bills with paper checks than using online bill pay. Paper checks can be lost—or stolen—during the mailing process, putting you at risk of identity theft and other types of fraud.
• Help the environment. Paperless bill options will help save the world's dwindling forests and overflowing landfills.

For more information, read "Before You Stop Automated Payments" in Home & Family Finance Resource Center.

courtesy of cuna.org

CUs offer loans to help members under water

MADISON, Wis. (6/16/08)--Credit unions in several Midwestern states outlined what they're doing to help members and employees affected by the past week's severe weather. Many have employees and members directly impacted by flooding.

At Centra CU in Columbus, Ind., 14 employees lost homes or cars, or experienced significant damage, said Nan Morrow, vice president of corporate development. Centra's relief program has three fronts: the members, the community and the employees, she said.

For affected members, the credit union initiated a flood relief loan of $1,000 in immediate cash, with no payment for six months. "We're working with members who have existing loans and mortgages, and helping them determine what to do," Morrow told News Now Friday. Long-term concerns such as home equity will "last a long time

Two branches of the $717 million asset credit union closed for half a day, she said, adding, "We're so thankful there was no internal damage." On Friday, all 22 branches and its ATMs were open. For the community, the credit union's staff donated to assistance organizations, such as the American Red Cross, and donated food and cleaning supplies.

For employees, the credit union staff set up a voluntary assistance fund and a spread sheet with the lists of needs for each employee impacted by the floods. Other employees are donating items on the "registry."

The credit union has also organized work teams to help clean up homes. "We're trying to help anyway we can," said Morrow Friday. Morrow noted that the area was under a thunderstorm watch and "we're expecting two more inches."

In Terre Haute, Ind., more than 800 homes were damaged when a levee broke. Indiana State University FCU had "a handful" of employees experiencing water damage. According to Amanda Royer, marketing coordinator, the $74 million asset credit union launched a flood relief loan plan on June 7 and advertised it in the local newspaper on Thursday. The 5-5-5 loan offers 5% annual percentage yield, is for $5,000 maximum, and is a five-year loan. Employees get the same terms but are offered 0% on interest.

Although Indiana State University FCU is less than a mile from the river, its member and employee parking lots were under water.

"We're helping people who want to know what to do with their mortgage if their house is a complete loss. One of the professors lost everything. He was in the subdivision that was wiped out when the levee broke," Royer said.

Westby (Wis.) Co-op CU has branches in four Wisconsin counties hard hit by floods: Vernon, Sauk, Monroe and Richland counties. Its Reedsburg branch experienced the most interruption of business--loss of communications with the main branch for two days--when the Baraboo River reached record levels. "We communicated by cell phone," said President Kevin Hauser, a board member of the Wisconsin Credit Union League.

The credit union kept its drive-up open to make sure members had service. To process transactions, it would communicate the transactions to other offices, which would post the transactions via a dedicated line. "It was important to get to the point we could post transactions. Our members needed the cash," Hauser told News Now.

Several employees couldn't get to work because of flooded or washed away roads. Many members were displaced in Ovolka, Ontario, LaFarge, Viola, Soldiers Grove and Gays Mills--all under water.

The credit union went through a similar heavy flood last fall, he said. Then, it waived overdraft fees for the entire credit union for two days--even for members not impacted by the flood. "It was our way of thanking them for their membership and urging them to help someone else in need," Hauser said.

Last fall, it also authorized deferment on payments up to three months for members who requested it and even waived the early withdrawal penalty on a member's certificate.

Staff in Reedsburg also is helping the community by taking their casual day fund and donating it to the American Red Cross, by providing workers with food, and by filling sand bags.

The credit unions were bracing themselves for a wet weekend, with more storms to compound the problems. Centra's Morrow noted that the area was under a thunderstorm watch and "we're expecting two more inches."

courtesy of cuna.org

Flood status of Iowa CUs updated

DES MOINES, Iowa, and MADISON, Wis. (6/16/08)--Several credit unions in Iowa Friday reported closing or relocating due to extreme flooding in the area. Meanwhile, CUNA Mutual Group was assessing the impact caused by flooding in Iowa, Wisconsin, Minnesota, Illinois and Indiana.

More than 20 credit union locations have been affected by the flooding in Iowa. The most severely impacted are those credit unions residing in Cedar Falls, Cedar Rapids, Des Moines and Waterloo. Those reporting changes in operation, as of Friday:

• Alliant CU, Dubuque, closed its Cedar Rapids branch;
• Cedar Falls Community CU, Cedar Falls, reopened downtown branch Friday;
• Collins Community CU, Cedar Rapids, closed seven branches yesterday and reopened five today;
• Community 1st CU, Ottumwa, closed the Amana branch and two Cedar Rapids branches;
• Des Moines Metro CU, Des Moines, relocated to First Class and United Service CU;
• First FCU, Cedar Rapids, reported one branch under water;
• Iowa Community CU, Waterloo, reported the Waterloo branch as under water. The Cedar Rapids branch is closed and has been relocated to Collins branch;
• Metco CU, Cedar Rapids, relocated to Quaker Oats;
• Midwest Utilities CU, Waterloo, closed;
• Nishna Valley CU, Atlantic, reported that long distance phone lines down Thursday were back up Friday;
• Quaker Oats CU, Cedar Rapids, closed at noon Thursday and reopened Friday;
• University of Iowa Community CU, Iowa City, closed the Iowa Memorial Union branch; and
• Veridian CU, Waterloo: closed the downtown Lafayette branch.

The Iowa Credit Union League continued to receive reports from Iowa credit unions affected by the flooding and will continue to provide support as needed. "Credit unions are executing their disaster recovery plans to the best of their ability, but no plan can completely account for the 500-year flood we're experiencing in Iowa," said Murray Williams, vice president of the Iowa Credit Union League.

As rains continued to fall in the Midwest Thursday and Friday, more flooding was expected. CUNA Mutual Group was focusing its efforts on Iowa and Wisconsin. "Although the affected area is widespread, our particular focus is in Iowa and Wisconsin, where several whole communities have been evacuated," Phil Tschudy, media relations manager at CUNA Mutual, told News Now.

He noted that because flooding is covered by federal insurance, there likely will be only a few coverages that will come into play for credit unions. However, "staff from our property and casualty claims area are continuing to contact credit unions in the affected areas to see how they are doing and to determine how we might be able to help," he said.

As of Friday, "we have only a few policyholders reporting minor water damage; however, that will likely change as flood-related evacuations are occurring from Cedar Rapids to Des Moines, Iowa." He noted that federal officials were warning residences along the Mississippi River to be prepared for the worst flooding in 30 years.

CUNA Mutual added a new Disaster Recovery Team link to its home page on cunamutual.com. It provides information credit unions need if disaster strikes and links to information on disaster prevention and preparation.

Credit unions with damage claims can contact CUNA Mutual's Disaster Response Claims at 800-637-2676, which is available 24/7/365.

courtesy of cuna.org

Floods close CUs in Iowa

DES MOINES, Iowa (6/13/08)--An estimated 20 to 30 Iowa credit unions are being impacted by numerous Midwest storms and subsequent flooding, according to the Iowa Credit Union League.

"A lot of Iowa is now flooding and getting pretty close to the huge 1993 state flood levels or worse in some areas," Murray Williams, league vice president, told News Now. "Some of the biggest metropolitan areas in the state have been hit hard, including Cedar Rapids, Waterloo, Cedar Falls and Des Moines. Most of the 20 to 30 credit unions impacted are experiencing actual flooding. Several downtowns are under water."

However, most of the affected credit unions have multiple branches and are able to move their operations to other areas, Williams said.

Those with main offices affected or single locations are moving to hot sites--alternative locations that credit unions have in their disaster contingency plans.

Credit unions on shared branching networks are moving to the locations that are on the data processing or shared branching network, and are setting up skeleton crews, Williams said.
"Although a good portion of Iowa is still accessible, numerous roads have been closing and opening, making transportation more challenging," he added.

To help Iowa credit unions with the flooding crisis, the league:

• Sent out communications telling credit unions what they need to be thinking about in a disaster and providing a checklist of tasks to do;
• Asked credit unions to notify the league if they have flooding situations, so the league can help mobilize needed support services;
• Deployed 15 to 20 league staff members to downtown Des Moines to help credit unions with moving to alternative locations and sandbagging against flood waters;
• Kept in contact with credit unions to let them know about the weather situation around the state; and
• Will send out communications soon to inform credit unions that the Iowa Credit Union Foundation's Disaster Relief Fund can provide some funding toward flood relief efforts.

courtesy of cuna.org

CMN hospitals among 'America's Best'--USN&WR

RESEARCH TRIANGLE PARK, N.C. (6/12/08)--Last week's issue of U.S. News & World Reports recognized the Credit Unions for Kids program for its contributions to the Children's Miracle Network (CMN) in its "America's Best Children's Hospitals" edition.

CMN partnered with the publication to highlight the teamwork of hospitals, sponsors and media partners working to provide the finest in pediatric health care, according to Joe Dearborn, managing director of Credit Unions for Kids.

"America's Best Children's Hospitals" ranks the top 30 hospitals in seven areas: general pediatrics, cancer, digestive orders, heart and heart surgery, neonatal care, neurology and neurosurgery, and respiratory disorders.

"We are extremely proud that the top 10 children's hospitals, as selected by U.S. News & World Report, are Children's Miracle Network hospitals," said Jim Hall, CMN president/CEO.
"It is support from programs like Credit Unions for Kids that enable these hospitals to provide such world-class, specialized care," Hall noted.

Of 143 hospitals considered eligible for the rankings, 113 responded. The research, conducted by RTI International, combines data from a survey of physicians, a direct survey of pediatrics hospitals (including freestanding children's hospitals and children's "hospitals within a hospital"), and other resources.

Each hospital's score is based on key components such as outcomes (including mortality rate and readmission rate), reputation, and care-related considerations such as specialized patient services, nursing care and advanced technology. These represent three key aspects of quality hospital care: structure, process and outcomes.

For the rankings, use the "America's Best Children's Hospitals" resource link.

courtesy of cuna.org

AARP study gives poor grades to FIs' communication

TEWKSBURY, Mass. (6/12/08)--Credit unions may want to note a recent nationwide survey that indicates that the financial services industry isn't effectively communicating with consumers.

AARP Financial, a subsidiary of the American Association of Retired Persons (AARP), found that more than half of adults surveyed said they have made an investment with an unfavorable outcome because they felt confused or didn't understand an investment.

"The relatively straightforward process of saving for the future has become incredibly complicated," said Richard Hisey, AARP Financial chief investment officer. "As a result, many American investors have saved too little--most with less than $50,000 for retirement--or are too intimidated to get started in the first place," he said.

About 54% said they do not read financial literature because it's too hard to understand, and 41% said information from financial services companies is not helpful. Two-thirds of survey respondents graded the financial services industry with a "C," "D," or "F."

More than 70% said financial professionals use more jargon than their car mechanic, and more than 50% said they use more jargon than doctors.

"We've made it incredibly easy for Americans to spend and create debt, but unnecessarily difficult to invest comfortably and with confidence," Hisey added.

Respondents said they feel the jargon is intentional. What's more:

• 54% believe jargon is used to distract people from focusing on the fees they will pay;
• 78% said they believe materials from financial companies are more about selling than educating;
• 63% said jargon is used to make a product seem more impressive; and
• 49% believe jargon is used to make consumers feel less confident that they can handle their own finances.

"No one is well-served by this confusion," Hisey said. "We talk a lot about transparency in this industry but not enough about simplification and understanding. What value does disclosure bring if the average investor can't comprehend it?"

The survey of 1,203 adults, age 18 or older, was conducted by telephone from Jan. 23 to Feb. 10.

courtesy of cuna.org

Don't fall for economic stimulus scam

MADISON, Wis. (6/11/08)--Be on the lookout for an e-mail from the Internal Revenue Service (IRS) encouraging you to submit a form to make sure you get your economic stimulus check. Why? The e-mail is not from the IRS, and if you click on the link, it's likely you'll be the victim of a scam, according to the Credit Union National Association's (CUNA's) center for personal finance.

Susan Tiffany, CUNA's director of adult education, warns recipients to report the crime and then hit the delete key. "It's a very convincing-looking scam that's sure to trip up many folks who fear missing out on their stimulus check," says Tiffany.

The e-mail Tiffany received urges the reader to click on a link in the e-mail, fill out a form, and submit the form before June 10 for a speedy refund. The end of the message acknowledges that you may have received the e-mail in your spam folder "because of the large amount of e-mails we are sending out or because of the restrictions implemented by your ISP (Internet service provider)."

Don't fall for that line, either. The message is a ploy to redirect you to the crook's website to capture your personal information and commit fraud.

If you receive an unsolicited e-mail claiming to be from the IRS, the IRS offers this advice:

• Never provide personal information in response to unsolicited e-mails. The IRS does not initiate contact with you via e-mail messages, nor does the IRS request PINs, passwords, or other access information for your credit card or for other financial accounts.
• Never click on attachments to questionable e-mails. The attachments may contain malicious code that infects your computer with viruses.
• Forward the original message to phishing@irs.gov. However, don't open the message in order to forward it. Create a new message and then drag and drop the original message into the body of the new message. For specific instructions for your e-mail provider (MS Outlook, Outlook Express, Mulberry, and so on), go to irs.gov and type "report phishing" in the search box.
• Report the scam to the Treasury Inspector General for Tax Administration. Call 800-366-4484 to report misuse of the IRS name, logo, forms, or other IRS property.
• Report this or other suspicious e-mails to the Federal Trade Commission. Go to spam@uce.gov, or call 877-IDTHEFT (877-438-4338).

If you think you've been the victim of ID theft, call one of the three credit bureau fraud units immediately: Experian: 888-397-3742; Equifax: 800-525-6285; TransUnion: 800-680-7289. Then notify creditors, close affected accounts, and file a police report.

courtesy of cuna.org

Report: Violent and property crimes declined in '07

WASHINGTON (6/10/08)--The U.S. experienced a 1.4% decrease in the number of violent crimes--including robberies--and a 2.1% decline in the number of property crimes committed in 2007, according to the Federal Bureau of Investigation (FBI).

Robberies were down 1.2% from 2006 robberies, according to the FBI's Preliminary Annual Uniform Crime Report for 2007, released Monday.

All four of the violent offense categories declined nationwide from 2006. Forcible rape dropped 4.3%; murder and non-negligent manslaughter decreased 2.7%; and robbery and aggravated assaults each declined 1.2%.

Cities with populations of 250,000 to 499,999 saw the most decline in violent crimes: 3.9%. They also saw the largest decrease in robberies--3%. The nation's largest cities, with one million or more in population experienced 2.9% fewer robberies than in 2006.

However, violent crime in non-metropolitan counties rose 1.8% while metro counties decreased 1.7%. Murder and non-negligent manslaughter decreased 9.8% in cities of one million or more population; those crimes increased 3.7% in cities with 50,000 to 99,999 in population.

Three of the nation's four regions saw violent crimes drop. However, in the South, it rose 1.7% during 2007 over 2006 data.

Property crimes dropped in all city categories, with the greatest decrease--4.2%--in cities with 250,000 to 499,999 inhabitants. Motor vehicle thefts declined in all population groups.
For more data, use the resource links.

courtesy of cuna.org

What Americans know about their finances--not much

SILVER SPRING, Md. (6/10/08)--Credit unions have an opportunity to help those struggling to pay their bills and mortgages on time, with a recent survey indicating that the majority of Americans don't know how to handle their finances.

The 2008 Financial Literacy survey, by the National Foundation for Credit Counseling and MSN Money, indicates that one in 10 Americans with a mortgage, or 10 million adults, reported being late or missing a mortgage payment in the last year.

One quarter of Americans also say they do not know enough about owning a home to consider buying one, the survey said.

Other highlights of the survey:

• Roughly 15 million adults receive calls from collectors or are considering filing for bankruptcy. Only two in 10 keep track of their spending--regardless of gender, age, or income;
• Higher income households and older Americans are more likely to stay on top of their bills. Whites and Latinos are more likely to pay their bills on time and stay clear of collections than blacks, and 59% of young adults in Generation Y pay their bills on time each month;
• The majority of the public does not have sufficient emergency funds, defined as three to six months' income saved. More than 76 million adults say they do not have retirement savings; and
• One-quarter of Americans expect their income to outpace inflation. More than half of Americans believe their income will shrink or not keep pace with inflation. The worry is the greatest among Americans in the Midwest at 70%.

courtesy of cuna.org

First Basin member seeks regulator intervention

ODESSA, Texas (6/10/08)--A member of First Basin CU has sent a letter to the commissioner of the Texas Credit Union Department, requesting that a state examiner investigate the April annual meeting of the credit union in which three incumbent directors' were re-elected.

The commissioner also is being asked to investigate the credit union's earlier attempt to convert to a mutual savings bank.

The five-page letter to Commissioner Harold Feeney also was sent to Texas Gov. Rick Perry, Texas U.S. senators, several state legislators and the National Credit Union Administration, among others.

In her letter, Karen J. Howard-Winters outlines several points in her complaint against CEO Shem Culpepper and the board of directors of the $115 million asset, Odessa, Texas-based credit union.

She alleged that they:

• Withheld important information regarding the election on the meeting notice postcard;
• Did not allow conversion opponents to distribute documents outlining their concerns;
• Did not allow the opponents to speak during the meeting or to refute claims made that they were influenced by an outside organization formed as a resource to help small credit unions protect themselves against predatory leadership aimed at insider enrichment;
• Appeared to be "stacking the deck" with votes from employees and their families;
• Spent First Basin funds for a parliamentary attorney who did not contribute to the fairness of the election; and
• Spent First Basin [funds] to hire a firm already on the payroll and not a neutral third-party, to count ballots.

The day before First Basin's annual meeting, the group opposed to the earlier conversion attempt petitioned the courts, seeking depositions from key officials of the credit union (News Now April 15).

The depositions related to a potential claim of defamation and breach of fiduciary responsibilities, said the court document. However, a suit was not anticipated at that time.

The group announced at a press conference at the Ector County Courthouse that it filed the petition because the credit union had spent roughly $500,000 "of member-owned funds trying to convert" the credit union to a mutual savings bank earlier this year.

In an April 8 letter, The Texas Credit Union Department responded that it did not believe it would be appropriate at that time "to insert itself into the credit union's election process."

The letter, written by Feeney, continued: "Dispute resolution involving an election process is a specialized field. People in this type of dispute resolution generally have undergone extensive training, and depending on the dispute in question, have experience in the field. Examiners are experts in their field, but have not undergone training in dispute training.

"While the department declines to send an examiner to observe the proceedings of the upcoming meeting, the department will continue to monitor this situation and will take appropriate action should it be determined necessary," the letter added.

A call to First Basin was not returned to News Now by press time. For more information, use the links.

courtesy of cuna.org

Green incentives for lenders: hearing this week

WASHINGTON (6/10/08)—There is a hearing scheduled this week on a bill that would provide incentives to lenders and financial institutions to provide lower interest loans and other benefits to consumers who build, buy, or remodel their homes and businesses to improve their energy efficiency.

The House Financial Services Committee hearing is Wednesday and a witness list will be available later this week. Its focus is H.R. 6078, the Green Resources for Energy Efficient Neighborhoods Act of 2008.

That bill was introduced May 15 by Rep. Ed Perlmutter (D-Co.) and sports 22 co-sponsors, including Rep. Barney Frank (D-Mass.), the chairman of the committee.

Perlmutter, in a release, has said of his bill, "This legislation proves that it is easy to be green. This bill helps revitalize our economy by making energy efficiency practices more affordable, accessible and achievable by consumers, businesses and government entities."

The only other hearing of particular note to credit unions scheduled in the House this week is on H.R. 5840, the Insurance Information Act of 2008. That bill would create a federal Office of Insurance Information within the Department of the Treasury to provide advice and expertise on insurance policy to the Administration and to Congress.

The hearing will be conducted by the House Financial Services subcommittee on capital markets, insurance, and government-sponsored enterprises. It was introduced in April by the subcommittee chairman, Rep. Paul Kanjorski (D-Pa.) and has four co-sponsors. A witness list had not been released as of Monday.

Kanjorski, along with Rep. Ed Royce (R-Calif.), is also author of the Credit Union Regulatory Improvements Act (CURIA, H.R. 1537), intended to modernize the regulatory structure of credit unions.

courtesy of cuna.org

Study: Too many strings attached to rewards programs

YONKERS, N.Y. (6/09/08)--As more retailers push their points programs, a new study finds fewer benefits, more restrictions, and a high level of frustration by consumers trying to cash in on those rewards (Consumer Reports July 2008).

Consumers Union, publisher of Consumer Reports magazine, reports that about 85% of U.S. households take part in at least one rewards program. And the list of providers keeps growing: supermarkets, drugstores, warehouse clubs, gas stations, bookstore chains, and more (Forbes.com June 2). But the trend seems to be veering away from rewarding loyal customers and leaning toward making it virtually impossible to cash in on those hard-earned points.

Even programs that do double duty as credit cards may not be worth the effort (Reuters June 2). For example, many rewards credit cards carry higher interest rates than traditional credit cards, and if you rack up charges just for the points, you may be paying more in interest and fees than you receive in savings and point benefits.

What can you do to avoid the rewards program blues? Consumer Reports offers these tips:

• Choose programs based on your own spending habits. Rather than enroll in several programs, concentrate your spending on one or two and build rewards more quickly.
• Consider cash-back programs. If you rarely or never redeem your points, cash-back cards may be your best bet to get at least some reward from your spending.
• Plan your spending. For example, know how many points you need to get what you want.
• Factor in the annual fee. If the rewards program charges you, say, $25 a year and your balance builds ever so slowly, you may be better off ditching the program altogether.
• Steer clear of credit card rewards programs if you carry a balance. High interest rates on those balances will quickly erase any rewards benefits you build up.
• Watch for limits. Some rewards programs place a cap on benefits earned and a deadline for when the rewards must be used.
• Don't overspend just to get a freebie. If your focus is on the prize rather than the costs associated with getting the prize, you may wind up paying more than it's worth.
• Don't leave rewards on the table. According to a 2006 survey by GMAC Mortgage and Harris Interactive, more than 41% of reward cardholders either rarely use or abandon their reward stash (CNNMoney.com June 2).

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CU's tough stance on ID theft commended in editorial

MOLINE, Ill. (6/9/08)--Using bogus official-looking e-mails and auto dialers, identity thieves have initiated several scams this year to try to trick IH Mississippi Valley CU's 85,000 members into disclosing their personal account information. The credit union's response has been lauded by a local newspaper.

The $601.7 million asset, Moline, Ill.-based credit union has immediately responded at least three times this year to thwart the scammers' attempts (Quad-Cities Times June 6).

The newspaper said in an editorial: "IH Mississippi Valley has been an ardent community supporter in addition to a successful credit union. We commend its extensive security and public information efforts to fight this scam head on. And we urge readers to follow the credit union's advice and contact it and the police if scammers hit again."

The credit union has been targeted with identity theft attempts with a frequency that is frustrating the credit union and its members, Laura Ernzen, IH Mississippi spokesperson, told the paper.

A few members have fallen for the scams, although none have endured permanent losses, she said. Federal authorities are investigating the scams, Ernzen added.

courtesy of cuna.org

CUs step up motorcycle loans in gas crisis

RANTOUL, Ill. (6/9/08)--With prices for gasoline in the U.S. skyrocketing, a number of credit unions are looking to step up their loan promotions for fuel-efficient motorcycles and scooters.
Mike Daugherty, president, Community Plus FCU, Rantoul, Ill., practices what he preaches by riding his scooter to work every day. "I bought it last year, and it is not often that you do get to do something that is practical, but fun as well," he told News Now.

The $12.1 million asset credit union has been offering loans on motorcycles and scooters "forever," he said.

"Last summer, we had a hot-pink scooter in our lobby for a promotion, but it didn't result in a lot of loans though," Daugherty said.

So far this year, Community Plus has not seen any substantial increase in motorcycle or scooter loans. Daugherty attributes this to the fact that many people in town drive to a larger metropolitan area--Champaign-Urbana, about 15 miles away--for work, which is more practical for a car than a motorcycle or scooter.

However, Community Plus is hoping to increase loans in this area.

"We are planning a promotion but we haven't work out the details yet," Daugherty explained. "We opened a branch by a motorcycle store that sells mostly Harleys. And although we don't do indirect [loans], we will work with the store if it sends people over. We'll offer loans to them and do the paperwork."

Although ultra-high gas prices have negatively impacted the big three U.S. automakers, many small businesses and consumers who drive a car, they have been a plus for scooter sales (LoHud.com May 18). In the first quarter of 2008, brand name scooters, including Honda, Suzuki, Yamaha and Vespa, went up 24%, according to Mike Mount, Motorcycle Industry Council trade group spokesman.

Fuel prices definitely seem to be the driving force behind the ongoing upward-spiraling scooter sales, based on anecdotal evidence, Mount added.

The Credit Union National Association's CU360 online research and advice portal for credit union executives has an article on credit unions offering scooter loans, as rising gas prices boost sales of smaller vehicles. Two credit unions are mentioned for their loan promotions in this area. The article also identifies the pros and cons of scooter loans.

For more information, use the link.

courtesy of cuna.org

W. Va. league responds to city's intent to tax CUs

PARKERSBURG and CHARLESTON, W.Va. (6/9/08)--The West Virginia Credit Union League has written a letter to city officials of Charleston, W. Va., warning that the city's intent to tax credit unions would violate both state code and the Federal Credit Union Act.

The league learned through a third party that the city of Charleston intended to propose a business and occupation (B&O) tax on earnings of credit unions as part of the state's Municipal Home Rule Pilot Program.

State legislation had given five cities permission as part of the project to find new ways to tax locally. Charleston is the first city to apply, Rich Schaffer, senior vice president of the league, told News Now, noting city officials "may think they may have more leeway than the law allows."

The Home Rule Commission approved the city's plans, but the matter has not gone before the City Council yet.

League President Kenneth R. Watts, in a letter sent May 30 to City Manager David D. Molgaard and other city officials, outlined why taxing credit unions would be a violation of the state and federal code.

"As not-for-profit financial cooperatives, credit unions are exempt from taxation at both the federal level (12 USC Sec. 1768) as well as the state level (WV Code Sec 31C-2-8)," Watts wrote.
"This exemption applies to any tax on capital, reserves, surpluses, income, or shares. Both citings are very specific statutory exemptions which I hope will sufficiently eliminate credit unions from any future consideration regarding sources of potential tax revenue," Watts wrote.
Watts also clarified a statement in city documents about "unrestricted 'full service' credit unions."

"It would seem you feel credit unions are not 'restricted' or perhaps not regulated," Watts wrote, adding that credit unions in the state are regulated by the National Credit Union Administration and the state's Division of Banking, and that credit unions must comply with all applicable consumer laws and regulations that apply to other financial institutions except the Community Reinvestment Act.

"It appears that you feel credit unions should be subject to B&O taxes due to their ability to offer an array of services and to serve communities rather than a 'particular business or organization.' Watt wrote.

"Since their inception in the U.S. in 1907, credit unions have always had multiple ways to serve their member/owners. While a common way was to have an occupational common bond, credit unions could also be organized to serve anyone within a specified community," Watts explained.
He cited as examples: the first credit union in the U.S., which served a parish in Manchester, N.H., and the first credit unions formed ever--in Germany in the mid 1800s.

"Both the U.S. Congress and the West Virginia Legislature have deemed credit unions worthy of a tax exemption due to their structure, not based upon the services they provide," he emphasized before outlining the not-for-profit financial cooperative, democratically controlled and governed by unpaid volunteers. He noted the restrictions credit unions have in ways they can raise capital.

Watts offered to meet with city officials for a further discussion. The league's attorney has also contacted the city's attorney as a professional courtesy.

Schaffer told News Now Friday the league had hoped to have a response by then, and added the league would monitor the situation for further action.

courtesy of cuna.org

IRS adds functions to online payment application

WASHINGTON (6/9/08)—The Internal Revenue Service (IRS) Friday introduced several new features to its interactive Online Payment Agreement application intended to make it easier for taxpayers, or their authorized representatives, to make changes to existing installment agreements.

According to an IRS release, the system will now permit individuals to revise:

• Their payment due dates and/or amounts on existing agreements;
• Existing extensions to regular installment agreements and direct debit installment agreements; and
• Existing regular installment agreements to a payroll deduction installment agreement or a direct debit installment agreement.

Also, the system now permits practitioners with valid authorizations to use the signature date found on their approved Form 2848, Power of Attorney and Declaration of Representative, or the caller ID as an alternate way to authenticate when requesting agreements for clients.

According to the IRS, more than 75% of those eligible for an installment agreement can establish one using the online application, Since its launch in October 2006, more than 30,000 taxpayers have successfully used it to set up a payment agreement.

Those eligible include taxpayers who owe $25,000 or less in combined tax, penalties and interest. They may self-qualify, apply and receive immediate notification of approval for installment agreements – including pre-assessed agreements on tax year 2007 Form 1040 liabilities and paperless direct debit agreements, the IRS release said.

courtesy of cuna.org

CO-OP Network's text-messaging service helps locate ATMs

RANCHO CUCAMONGA, Calif. (6/5/08)--Credit union members wanting to find the nearest surcharge-free ATM nearest can text their location to a number at CO-OP Network or download a database of ATM locations directly to their personal navigation devices, according to CO-OP Network.

The network announced it is doubling the options members have for finding surcharge-free ATMs. Now cardholders can text their location to 692667 (MYCOOP) or download the database as well as use CO-OP's current phone and online ATM locator functions.

How does it work? Cardholders text their location--address, intersection or ZIP code--to the MYCOOP number on any mobile phone. In less than one minute, the service replies with the CO-OP Network's surcharge-free ATMs nearest the location. To find additional locations, the user simply replies with "MORE."

"One of the biggest misconceptions is that credit unions are inconvenient," said Stan Hollen, president/CEO of CO-OP Financial Services, the network's parent organization.

"By offering services such as text messaging and GPS (global positioning system) navigational downloads, credit unions immediately increase their convenience and display more technology know-how than some of the largest banks," he said.

Members with a personal navigation device such as Garmin will be able to download the network's ATM database through a link on www.co-opnetwork.org, planned for later this month.
Once the database loads, members can receive turn-by-turn directions to drive to the nearest CO-OP Network ATM. The database will be updated monthly.

courtesy of cuna.org

Loans up, savings balances decline in April

MADISON, Wis. (6/5/08)--Credit union loans outstanding increased 0.9% in April 2008, and 1.8% during the year, a one percentage point increase compared with the same period last year, according to the Credit Union National Association (CUNA) monthly sample of credit unions.
"The year-to-date loan growth of 1.8% is a bit stronger than we had expected," said Bill Hampel, CUNA chief economist.

This probably is--despite the fact that members are cutting back on borrowing--also because of the weak economy, Hampel explained. Members are doing more of their borrowing at credit unions because other lenders have substantially cut back on lending. There are likely to be more opportunities for credit unions to make good loans, especially mortgage loans, for the rest of the year because of restricted credit supplies from other lenders, he told News Now.

"After making sure of the asset/liability management implications, credit unions with sufficient liquidity can meet some of these member demands," Hampel added.

The year-to-date increase in loans also is partly due to fixed-rate first mortgages increasing 7.4%.

Adjustable-rate mortgages rose 2.9% during April, followed by other loans (1.6%), fixed-rate first mortgages (1.5%), used-auto loans (1.1%), home equity loans (1%), credit card loans (0.9%), and unsecured personal loans (0.6%).

Other mortgages (1.3%) and new-auto loans (0.7%) declined during April.
Credit union savings balances declined 0.2% in April, but grew 4.8% year-to-date. Money market accounts and one-year certificates increased 1.5% and 0.5%, respectively. Share drafts (2.7%), individual retirement accounts (1.5%), and regular shares (0.9%) decreased during the month.

"Savings growth is still running ahead of the weak performance of the previous four years, and CUNA's economists expect 2008 to be a strong year for credit union savings as members cut back spending because of the weak economy," Hampel said.

During the first four months of 2008, money market accounts increased 10%, double the 5% for the same period last year.

Credit unions' loan-to-savings ratio increased to 81% in April from 80% in March. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--declined to 19% in April from 21% in March.

Regarding asset quality, credit union 60-plus day delinquencies were 1% in April 2008.
The rapid rise in loan delinquency last year, from 0.68% in April to 0.93 in December, has since slowed, Hampel noted, adding "the delinquency rate was essentially unchanged from March to April, rising from 1.00% to 1.01%.

"The outlook for 2008 remains difficult for credit unions," Hampel said. "But, the good news is that credit quality does not seem to be worsening further."

With the increase in assets, the movement's overall capital-to-asset ratio remains at 11.1%. The total dollar amount of capital is still at $90 billion.

courtesy of cuna.org

Key to investing in recession: Stay calm

NEW YORK (6/4/08)--Despite a struggling economy, don't make the assumption that you should stay away from--or get rid of--stocks. If you do, you may be missing out on some potentially hefty long-term returns (CNNMoney.com May 28).

Stock investors already are looking ahead to a recovery, and investment experts say this is the time to be buying stocks, not selling them (Bankrate.com March 3). And with prices relatively low right now, the longer you hold those stocks in a well-diversified portfolio, the greater the likelihood you'll build up a sizeable stash.

Whether you're a beginning or a serious investor, it's important to stay calm and get your financial ducks in a row:

• Pay off high-cost debt. If you want an exceptional return in a hurry, pay down high-interest credit card debt. The return is likely to far exceed what you'll get in the stock market--at least in the short run.
• Line up a line of credit. Have this as a backup plan in case you're faced with high-cost repairs, medical debt, or a layoff.
• Revisit your risk tolerance. If you're less comfortable with higher-risk investments than when you established your accounts, make adjustments so you can get a better night's sleep.
• Find money to save. Even a small amount invested regularly over time adds up. Consider this: Substitute home-made coffee into your regular routine, have that $50 you save every month direct-deposited into a diversified stock mutual fund, and you'd generate more than $29,000 over 20 years if your average rate of return is 8%. Over 30 years, that $50 a month could yield more than $74,000 with the same average rate of return.
• Beef up your 401(k). Contribute as much as you can to your company-sponsored plan and take advantage of the company match. If you don't, you're leaving free money on the table.

Stay the course. Once you decide on an investment strategy with a well-diversified portfolio, leave it alone. Revisit your strategy periodically--say, once a year--while keeping your sights on a longer investment horizon.

For more information, use the "Financial Longevity" tool in Plan It: Retire Ready Toolkit.

courtesy of cuna.org

CU launches rewards-based wellness program

SAN ANTONIO (6/4/08)--Security Service FCU has partnered with Spectrum Athletic Clubs to provide an activity-based, rewards program for its employees in Texas and Colorado.

With the new CU Fit program, all 1,300 employees of the $4.376 billion asset, San Antonio-based credit union are eligible to receive a free health club membership that includes rewards-based activity incentives and online support.

"It's a significant investment," said David Reynolds, president/CEO of the credit union. "These are well-spent dollars that mean our employees are healthier, happier and more fit--and that benefits them, their families, the credit union and our members."

The move by Security Service FCU is an example of two major shifts in corporate wellness programs, the credit union said. First, more businesses are taking on the responsibility for developing and implementing programs that traditionally have come through insurance companies.

Second, there's a growing movement toward values-based benefits programs in which benefits are viewed as a corporate investment, rather than an expense.

"We definitely view this as an investment in our employees and their families," Reynolds said. "We value our employees. CU Fit is a beneficial program that we hope will contribute to their success, just as they contribute to the success of the credit union."

courtesy of cuna.org

PCUA to CUs: Make room for student loans

HARRISBURG, Pa. (6/4/08)--As the student lending market gets tighter, credit unions have an opportunity to connect with young members and provide a service to build lasting relationships, said Pennsylvania Credit Union Association (PCUA) President/CEO Jim McCormack.

Many large banks have stopped lending to students attending community colleges, for-profit universities and other less competitive institutions--which means that needy students will be challenged with finding enough money to pay for school, the PCUA said (Life is a Highway June 3).

McCormack encourages credit unions to provide student lending programs. Pennsylvania credit unions have created TEAMS, a cooperative program that helps credit unions offer student loans to members through the Federal Family Education Loan Program (FFELP).

A number of lenders have withdrawn from FFELP because they can't sell loans in the secondary market, the league said, referring to a recent The Wall Street Journal article.

"[Student lending] is good business and reinforces the credit union's future," McCormack said.

courtesy of cuna.org

USA Today features Biz Kid$ in Money section

FEDERAL WAY, Wash. (6/4/08)--BizKid$, a television program underwritten by America's Credit Unions, aimed at teaching youths about money, received coverage in Monday's USA Today Money section.

Rebecca Charbonneau, a member of Kitsap CU, Bremerton, Wash., was featured in the article. Charbonneau was in Episode 104 of BizKid$ for opening a candy store at the age of 15.

"Rebecca really embodies the message of the show," said RoxAnne Kruger, BizKid$ project manager and senior vice president of the Washington Credit Union League. "And that is, when you stay focused and have a dream, you can make anything happen."

Charbonneau has spoken at meetings and conventions on behalf of BizKid$, she added.
Financial education has never been more important--so the timing of BizKid$ is incredible, Kruger said. The show highlights the importance of financial literacy, and entrepreneurship--which is vital to the economic environment.

"Credit unions have a long tradition of fostering financial education," Kruger said. "BizKid$ is an innovative way of communicating financial education to the next generation."

BizKid$ is funded by the National Credit Union Foundation, and was developed by Junior Achievement.

It airs on 311 of the nation's 343 PBS stations in 49 states. American Public Television reported that by March, the show had reached 118 million households. It is airing in 14 of the nation's top 15 markets.

About 140 credit unions, leagues, foundations and affiliated system organizations and service providers have supported Seasons One and Two. NCUF is the show's largest funder. Other supporters include CUNA Mutual Group, the World Council of Credit Unions, the Federation of Community Development Credit Unions and several corporate credit unions.

On May 22, Biz Kid$ producers and actors hosted a group of National Credit Union Foundation Development Educators in Seattle for a three-day summer workshop. Part of the workshop included a tour of the BizKid$ set, and a preview screening of an episode.

A DVD of curriculum and other student activities related to the first 21 episodes also was distributed during the workshop. The DVD was created by Junior Achievement.

courtesy of cuna.org

Native American predatory lending examined by Senate

WASHINGTON (6/3/08)--The Credit Union National Association (CUNA) will participate Thursday in a U.S. Senate Committee on Indian Affairs oversight hearing entitled "Predatory Lending in Indian Country."

CUNA witness Darwin Brokke, president/CEO of Citizens Community CU of Devils Lake, N.D., will explain credit union alternatives to predatory lending in Native American communities.

The hearing starts at 9:30 a.m. ET and can be viewed via the Internet. Use the resource link below for more information.

courtesy of cuna.org

N.J. CUs help families send Web greetings to soldier dads

HIGHTSTOWN, New Jersey (6/3/08)--New Jersey credit unions are helping send free online greetings from military children, spouses and families to soldier dads for Father's Day.

The program, Operation Father's Day Salute, invites families into a recording studio to record a 10-minute greeting June 9-13. The greetings will be sent using the studio's encoded high-speed Internet connection.

The soldiers can view and respond to the greetings through instant text messaging, or access the greetings at a later date.

Families can reserve their recording session prior to the event by visiting www.operationbestwishes.com.

Operation Father's Day Salute is sponsored by the New Jersey Credit Union League, with additional support from CU Abstract, CUNA Mutual Group, East Coast Business Lenders, P.W. Campbell and Sprint.

courtesy of cuna.org

Study: CUs ahead of competitors on mobile banking

BOSTON (6/3/08)--Mobile banking in financial institutions is still lagging behind the growing rate of mobile phone use in the U.S. But credit unions are leaders in the mobile banking efforts surfacing so far, according to a new study.

Of the 260 financial institutions studied, 39 institutions--or 15%--provide mobile banking, noted Mercator Advisory Group Inc.'s report, "U.S. Mobile Banking: Sedate Growth, Disruptive Potential." Mercator is based in Boston (Cardline May 30).

The study found that 23% of the largest credit unions have mobile-banking services. That compares with 17% of the largest banks and none of the largest community banks, according to the report.

In 2007, roughly two million Americans were mobile-banking subscribers, fewer than the 3.7 million the Mercator Advisory Group had predicted last year.

The report's author, George Peabody, noted that last year not enough financial institutions offered mobile banking. But he predicted steady growth of mobile-banking users of 33.1 million by 2012.

Poor marketing and lack of consumer awareness about mobile banking may prevent mobile banking from succeeding, Peabody said. Financial institutions aren't promoting their mobile banking on their websites, which would lure Generation Y customers, he said.

courtesy of cuna.org

Minneapolis may get first Muslim CU next year

MINNEAPOLIS (6/3/08)--Minneapolis is slated to become the home to the first Muslim credit union in the U.S.

The city's African Chamber of Commerce--which is planning the credit union--currently has a database of 1,500 people who support the credit union, said Martin Mohammed, executive director of the chamber (Northwestern Financial Review May 15).

The chamber's five-year strategic plan drafted in 2007 calls for the formation of a credit union in an unspecified Minneapolis location in 2009.

The credit union would provide services to people who are unbanked and families and establishments that conduct business according to tenets of Islamic law. The credit union will institute creative ways to adhere to religious restrictions that prevent Muslims from collecting interest on savings or paying interest on loans, Mohammed said.

There is a significant Muslim population, not only in Minneapolis, but in the U.S., Mohammed said. He said the Minneapolis credit union can become a model for credit unions nationwide--particularly in California and Michigan in which there are significant Muslim populations--on how to provide financial services to Muslims.

courtesy of cuna.org

Three of four consumers clinging to paper statements

SAN FRANCISCO (6/3/08)--While many credit unions are turning their operations green and encouraging their members to do the same, old habits die hard. Three out of four consumers still cling to their paper statements.

A new report released Monday by Javelin Strategy & Research found that green banking habits have yet to take hold. The San Francisco-based firm noted that if every U.S. household stopped receiving paper bills and statements, they would save 687,000 tons of paper every year--enough to circle Earth 239 times.

The report found that consumers aren't aware of how they can make a difference, and financial institutions have yet to find incentives that compel consumers to participate.

"Most consumers want to do the right thing, but if the process appears confusing or inconvenient, they simply aren't going to bother changing their habits," said Mark Schwanhausser, research analyst at Javelin Strategy & Research.

Of the 13 companies mentioned in the report, five are credit unions: Credit Union One of Oklahoma, Oklahoma City; Sound CU, Tacoma, Wash.; Star One CU, Sunnyvale, Calif.; Technology CU, San Jose, Calif.; and Vancouver City Savings CU, Vancouver, B.C.

The Green Banking Report's key findings:

• Three out of four consumers receive paper statements;
• Of those surveyed, 34% said they switched to electronic statements to reduce their impact on the environment;
• 43% said they are more likely to do business with companies they perceive to be green;
• 22% said green initiatives cement the bond they have with their bank;
• 60% of "green bankers"--consumers who say environmental impact is "extremely important" in purchasing and banking decisions--are women; and
• 64% of "skeptics"--consumers who are "very less likely" to be more loyal to their bank because of its environmental activities--are men.

Availability, accessibility and complexity are the key challenges stalling the adoption of green banking behavior, said Javelin.

It advised financial institutions to focus on products and promotions that speak directly to environmentally conscious consumers. These include "green audit" calculators to help consumers compute the environmental impact of their banking behavior, a one-stop paper statement shut-off option for all accounts and green banking marketing campaigns that reward consumers for eco-friendly practices.

courtesy of cuna.org

Survey: Americans make tough economic decisions

WASHINGTON (6/2/08)--If you've been trying to stretch your paycheck a little further these days, join the club. In a recent AARP survey, 81% of respondents said the U.S. economy is in fairly bad or very bad condition, and nearly 75% believe the economy is getting worse (AARP May 6).

AARP commissioned the nationwide survey to assess how Americans age 45 and older are responding to the economic downturn. The results showed more middle-aged and older Americans are worried about the economy, and are changing their habits as a result:

One of four (26%) had trouble paying their mortgage or rent;
Two-thirds (66%) had trouble paying for essential expenses like food, gas, and medicine; and
More than half (53%) had trouble paying for utilities.

Roughly 60% of respondents tried to make up for these budget shortfalls by eating out less and spending less money on entertainment. Almost half had postponed plans to travel or make a large purchase.

The struggling economy also has affected retirement plans. One-third of survey respondents stopped putting money into their retirement accounts, and 23% withdrew funds from investment accounts prematurely. In addition, more than one-fourth of all workers age 45 and older have postponed their retirement start date.

The difficult economic decisions Americans face may affect their decisions at the polls in coming elections. The majority of survey respondents (74%) believes elected officials are not doing enough to help people hurt by the economic downturn. A CNN/Opinion poll revealed that nearly half (49%) of Americans consider the economy the most important issue when deciding whom to vote for in November's presidential election.

Seek help now if you're struggling financially:

• Prevent foreclosure: Visit hopenow.com or call 888-995-HOPE (995-4673);
• Seek credit counseling: Visit nfcc.org or call 800-388-2227; and
• Map out a spending plan: Contact your credit union, or the local cooperative extension service via csrees.usda.gov/Extension/.

courtesy of cuna.org

CU Aid gives $123,300 to those affected by Calif. wildfires

RANCHO CUCAMONGA, Calif. (6/2/08)--About $123,300 in grants have been distributed to help credit union members affected by wildfires that hit Southern California last fall, the California Credit Union League said Friday.

CU Aid is a centralized disaster relief fund-raising mechanism activated by the National Credit Union Foundation (NCUF) and the league during the fires.

The grants were distributed throughout the San Diego area--which was one of the areas hid hardest by the fires.

The grants--ranging from $500 to $10,00--were distributed to members of:
Financial 21 Community CU, San Diego;
First Future CU, San Diego;
Great American CU, San Diego;
Ketema FCU, El Cajon;
Mission FCU, San Diego;
San Diego County CU;
San Diego Metropolitan CU; and
USE CU, San Diego.

Some of the checks were presented by NCUF Immediate Past Chairman Mary Cunningham, CEO, USA FCU, San Diego.

"CU Aid grant recipients are realizing they are part of a larger credit union community," Cunningham said. "They will be loyal credit union members for life."

Most of the recipients lost their homes, and said they are planning to use the money to rebuild.
Most of the available funds raised for wildfires victims have now been distributed; some were recently reallocated--with the support of contributor--to help those impacted by the tornadoes that hit Alabama in February. This allowed the NCUF to make 17 more grants totaling over $87,000 for credit union employees and members who lost their homes.

The CU Aid donation form has been restructured to ensure that relief money can be channeled efficiently to any major disaster area that impacts credit unions. Supporters can donate via www.cuaid.coop/california in California or www.cuaid.coop/nevada in Nevada.

All donations are directed to the National Credit Union Foundation Disaster Relief Fund, which dedicates every dollar to grants. For donors outside of California and Nevada, use the link.

courtesy of cuna.org

CUs need to say 'Hey! We're the good guys!'

MADISON, Wis. (6/2/08)--Television commentator and retail financial services expert Ron Galloway, director of a controversial documentary about Wal-Mart, believes credit unions are the only financial institutions that consumers can trust.

But as National Credit Union Foundation (NCUF) Executive Director Steve Delfin explains in his "Viewpoint" column in the June issue of Credit Union Magazine, credit unions need to tell their story.

"I met and heard Galloway speak at the Credit Union Association of Colorado and Wyoming's Annual Meeting," Delfin said. "While not optimistic about America's economy, he now emphatically asks, 'Why aren't credit unions telling their story? In case you guys haven't noticed, banks aren't particularly keen on credit unions. They're trying to eat your lunch on Capitol Hill.'"
As Galloway tells credit unions with his Georgia vernacular, "Y'all need to get loud! You need to say, 'Hey! We're the good guys!'"

"He's right," Delfin said. "We need to tell our stories about the value of credit unions, about the help we provide, about outreach to emerging underserved populations, and about how credit unions are the only financial institutions that consumers can trust."

NCUF is offering credit unions the opportunity to tell their stories in the Social Impact and Community Outreach Special Supplement in Credit Union Magazine. The supplement will be featured in NCUF's Annual Report to be published in the October issue of Credit Union Magazine.

To reserve a spot in the supplement, credit unions and their supporters can use the resource link or call Delfin at 800-356-9655, ext. 6769.

"Credit unions truly are standard bearers of social responsibility in the financial services industry," Delfin concludes. "Credit unions are where the institutional values and principles of the cooperative business model have so clearly and emphatically resulted in socially responsible, ethical, pro-consumer behavior. Credit unions are consumers' champions. We're helping the people who need it most. We need to get louder."

courtesy of cuna.org

Fed Survey: Half of U.S. banks tightening lending

FARMERS BRANCH, Texas (6/2/08)--A Federal Reserve survey of senior loan officers released May 5 indicates that roughly 50% of banks nationwide are tightening their lending standards on commercial and industrial loans. This could result in opportunities for smaller lenders such as credit unions.

The percentage is up from the 30% of banks that reported tightening in January (LoneStar Leaguer May 28).

About 65% of banks--up from about 40% in the January Fed survey--indicated that they had increased spreads of commercial and industrial loan rates over their cost of funds for these items. Large banks were more likely to tighten, according to the survey.

The pullback by the large banks could create opportunities for smaller and nontraditional lenders. However, some entrepreneurs are feeling uncertain about other types of funding sources, such as venture capital.

More businesses--in excess of 5,000 firms--filed for bankruptcy in April 2008 than in any month since the new bankruptcy laws took effect in 2005, the survey indicated. The increase in filings shows that trouble in the subprime housing market and other financial instruments on Wall Street have affected small businesses.

A combination of tighter credit, higher commodity prices, and stagnant sales probably account for the rise in bankruptcies, with builders and other businesses tied to the housing market accounting for many filings, the survey said.

courtesy of cuna.org

Hampel on TV: Recovery will have 'saucer-like' bottom

WASHINGTON (6/2/08)--Falling home values and rising gasoline prices are buffeting consumer confidence, which will result in a slow economic recovery with a "saucer-like" bottom, Credit Union National Association (CUNA) Chief Economist Bill Hampel told Bloomberg Television Friday.

Bloomberg anchor Kathleen Hays interviewed Hampel on the topic of consumer confidence.
Real household spending on everything besides fuel is negative so far this year, said Hampel, who pointed out that fuel for transportation can account for more than 10% of a household's budget.

He said consumers' inflationary expectations are somewhat inflated due to recent spikes in gasoline and food prices, while most other prices actually are well-behaved.

"The other economists at CUNA and I actually believe inflation will be moderating for the rest of the year," Hampel said. "This eventually will get built into consumer expectations and confidence."

Hampel believes economic indicators published later this year will show the U.S. economy entered a recession in December or January. He predicts the recovery to begin in the third quarter, but that the consequent growth will fall below recent trends.

He also thinks the meager recovery will spur the Federal Reserve to cut interest rates another 25- to 50 basis points by the end of this year.

Hampel said consumer balance sheets are in "lousy condition" after many borrowed against home equity, which in many cases has evaporated. "Consumer debt ratios are really high. It will take quite a long time to rebuild their net worth," said the CUNA economist.

courtesy of cuna.org

CUs can help car buyers 'steer clear' of predatory auto loans

WASHINGTON (5/30/08)--Credit union auto lenders are invited to participate in a summit that will share new research featuring lending models that "Help Car Buyers Steer Clear of Predatory Auto Loans."

Both the research and the summit will be presented by three national organizations aligned to help credit unions serve working families with low wealth and modest incomes: the National Credit Union Foundation (NCUF), the Annie E. Casey Foundation, and the Aspen Institute.

The "Steer Clear" Auto Lending Summit will take place Tuesday, July 22, from 10 a.m. – 2 p.m. at Credit Union House on Capitol Hill in Washington.

The first 40 credit union lenders who RSVP by June 13 will receive a preview of the research report: Credit Unions Help Car Buyers Steer Clear of Predatory Loans.

At the summit, participants will discuss ideas on anti-predatory lending models that could best be adapted in credit unions. Participants' input will help finalize the report, which will be shared with the credit union movement through NCUF's signature program, REAL Solutions.

"Credit unions serve only 5% of the non-prime auto loan market," noted REAL Solutions National Program Director Lois Kitsch. "This new research will offer proven models that credit unions can use to serve this market in ways that are economically viable."

To RSVP, e-mail lkitsch@ncuf.coop. For more information, use the Resource Link or call 800-356-9655, ext. 6770.

courtesy of cuna.org

Former broker hails CUs for avoiding subprime loans

HARRISBURG, Pa. (5/30/08)--A former mortgage broker praised credit unions for avoiding the subprime loan game at two Pennsylvania Credit Union Association lending council meetings in the state.

The former broker, Paul Grabstanowicz, now a training consultant, was conducting training for the meetings on subprime lending solutions, said PCUA (Life is a Highway May 29).

Subprime lending was profit-driven, he told the group. In hailing credit unions, he cited a 2004 letter issued by the National Credit Union Administration (NCUA) that warned credit unions about high risk subprime lending activities and said proper care is required in this area.

The subprime fallout presents an huge opportunity for credit unions, he said. He urged credit unions to counsel first-time home buyers and offer subprime borrowers safe, conservative products when refinancing members out of subprime adjustable-rate mortgages (ARMs).

courtesy of cuna.org

Foreclosures near military four times national average

IRVINE, Calif. (5/30/08)--Foreclosures in U.S. towns where soldiers live are increasing at a pace four times faster than the national average, according to a survey by RealtyTrac Inc. of Irvine, Calif.

Earlier this month, RealtyTrac released its April 2008 U.S. Foreclosure Market Report which indicates that foreclosure filings nationwide--default notices, auction sales notices and bank repossessions--were reported on 243,353 properties, a 4% increase from the previous month and nearly a 65% increase from April 2007.

Foreclosure filings near military bases from January to April compared with a year earlier were up as high as 492%, according to the report.

Among the leaders:
Columbia, S.C.: 492% increase;
Woodbridge, Va.: 414%;
Triangle, Va.: 363%;
Oceanside, Calif.: 182%;
Norfolk, Va.: 155%;
Havelock, N.C.: 133%;
Carlsbad, Calif.: 131%;
Barstow, Calif.: 120%;
Columbus, Ga.: 102%; and
Twentynine Palms, Calif. 73%.

However, the trend has not affected some of the defense credit unions in these areas.
AllSouth FCU, formerly Ft. Jackson FCU, a 406.4 million asset, Columbia, S.C.-based credit union, is not seeing any rise in foreclosures among its members, Thomas Boswell, AllSouth vice president of mortgage lending, told News Now.

"The area we're in is having some [foreclosure] issues, but our particular credit union is not," Boswell said. "We've been extremely fortunate so far. Delinquencies have increased slightly, but we've only had one foreclosure all year in 2008."

Columbia, S, C., home to Fort Jackson, has seen a 492% rise in foreclosures so far this year compared with last year, according to RealtyTrac. Payday lenders often get blamed, but Boswell said it's hard to pinpoint one specific issue for the rise in foreclosures. Payday lending is more of contributing factor rather than a root cause of the problem, he added.

The Norfolk, Va., branch of Chartway FCU, a $1.3 billion asset, Virginia Beach-based credit union, has not seen a spike in foreclosures. "We've only had one foreclosure this year--a physician who lost his job," Ron Burniske, Chartway president/CEO, told News Now.

Payday lenders, although prevalent, have not impacted his credit union, Burniske added.
"There are a tremendous number of payday lenders in our area that gravitate to military bases--we have three bases in our area," he said.

"We haven't had any direct exposure to them. People who gravitate to payday lenders are not members of credit unions, because we have better services and prices than payday lenders. Most contacts with payday lenders are non-bank contacts; they're usually not members of credit unions," he said.

The Center for Responsible Lending's (CRL) research shows that the payday lending business model is designed to keep borrowers in debt, not to provide one-time assistance during a time of financial need. According to CRL's research, borrowers who receive five or more loans a year account for 90% of the lenders' business. A CRL report shows that payday lenders cost American families $4.2 billion every year in predatory fees.

CRL has not conducted any research that studies causation between payday lending and foreclosure rates, Sharon Reuss, CRL spokesperson, told News Now. "However, payday loans do drain wealth from people," she said.

Norfolk, Va., has seen a 155% rise in foreclosure filings, according to RealtyTrac.

The Oceanside, Calif., branch of Pacific Marine CU, a $497.4 million asset, Camp Pendleton, Calif.-based credit union, told News Now it is a very conservative lender and has no foreclosures. Oceanside has experienced 182% rise in foreclosure filings this year compared with a year ago, RealtyTrac said.

courtesy of cuna.org