WASHINGTON (7/30/08)--Retirement planning just got a little easier. Last week the Social Security Administration unveiled a new online retirement estimator providing users with a more accurate estimate of benefits, particularly for those nearing retirement age (Social Security Administration.gov July 21).
The new calculator has several enhancements:
Speed. The new calculator is tied directly to your Social Security earnings record. This means you don't have to manually enter in years of earnings data.
Accuracy. The closer you are to retirement age, the more accurate this estimate will be. The old paper statements assume your salary stays the same until you retire, which is unrealistic for most people, resulting in less accurate estimates (Boston.com July 23).
Multiple estimates. You can print out up to three different estimates at one time for comparison. For example, view retirement benefits for retirement at ages 62, 66, and 70.
Security. The new calculator doesn't display your earnings record information used to calculated the final benefits estimate, nor does it display any personal information such as address, earnings, or other information that could lead to identity theft.
Stay tuned. This fall the Social Security Administration plans to introduce its next initiative: a total overhaul of its online retirement application. Expect the average filing time to decrease significantly from 45 minutes to about 15 minutes.
For more information, read "Can You Count on Social Security?" in Plan It: Retire Ready Toolkit.
courtesy of cuna.org
Wednesday, July 30, 2008
CUs report big scare, no damage in LA earthquake
LOS ANGELES (7/30/08)--Credit unions and the movement's organizations based in Southern California reported no damages from the 5.8 magnitude earthquake that hit the Los Angeles area Tuesday morning.
The quake occurred just before noon in California. "It happened just about 15 minutes ago," Kathy Marcelletta, Wescom Central CU branch manager, told News Now Tuesday.
Marcelletta's branch, which is located near Chino Hills, the epicenter of the earthquake, didn't feel a large impact from the quake. "The branch shook a little," she said. Members were in the branch at the time of the quake, but were not concerned, she said.
Barbara Ago, president/CEO of the Pomona branch of Cal Poly FCU, just arrived at her office when she was contacted by News Now. The credit union is located in a student union building on the Cal Polytechnic Institute campus, and was just retrofitted, she said.
"We are fine," she told News Now. "It was a good shake. We're a few miles from the epicenter."
The credit union's office wasn't damaged, and nothing was broken--which is likely due to the fact that the credit union just repainted its walls, and had unstrapped all of its bookcases from the walls. "Our computers are up," she added.
But the building the credit union is located in has some damage, and there may be damage to other buildings on campus. A campus water main broke, and drywall cracked in other buildings. Glass is being cleaned up, and "I did hear some ambulances drive by," she said.
Earthquakes in the area happen about once every 15 years, she said. "We're used to it."
The California Credit Union League (CCUL), based in Rancho Cucamonga, Calif., is about nine to 10 miles from the quake's epicenter, Matt Buck CCUL public affairs specialist, told News Now.
"People felt the quake in Los Angeles and we felt the shaking here," Buck said. "But there was no damage, just one guy's Pez dispensers tipped over in the corner of our office."
"We haven't heard anything from credit unions," he added.
Western Corporate FCU's (WesCorp) facilities are located in San Dimas, about 10 miles from the epicenter.
"We haven't had a good shaker like that in years," Walter Laskos, public relations director at WesCorp, told News Now. "It caught people off guard and rattled our nerves, but nothing fell off the shelf.
"A lot of folks evacuated, but several remained and answered the phones. The first thing we do is check the critical systems immediately, such as the gas lines, and they were fine," he said.
WesCorp's building, which was visibly shaking, is built to hospital standards and can withstand an earthquake of 8.0 magnitude, he said.
WesCorp had no reports from credit unions of any damages, and Laskos was preparing a message to its member credit unions stating that WesCorp was operating. "It's business as usual."
Stan Hollen, president/CEO of CO-OP Financial Services, located in Rancho Cucamonga, told News Now, "It was a good jolt and lasted about eight seconds. You definitely felt it."
CO-OP's three-story building is seven miles from the epicenter, he said. Staff did not evacuate the building, but "we have a few rattled employees." The aftershock, which registered 3.8, was "barely noticeable."
ATMs in the CO-OP Network were undamaged. "We checked with the Network's operations center and no ATMs or lines are down," Hollen said.
courtesy of cuna.org
The quake occurred just before noon in California. "It happened just about 15 minutes ago," Kathy Marcelletta, Wescom Central CU branch manager, told News Now Tuesday.
Marcelletta's branch, which is located near Chino Hills, the epicenter of the earthquake, didn't feel a large impact from the quake. "The branch shook a little," she said. Members were in the branch at the time of the quake, but were not concerned, she said.
Barbara Ago, president/CEO of the Pomona branch of Cal Poly FCU, just arrived at her office when she was contacted by News Now. The credit union is located in a student union building on the Cal Polytechnic Institute campus, and was just retrofitted, she said.
"We are fine," she told News Now. "It was a good shake. We're a few miles from the epicenter."
The credit union's office wasn't damaged, and nothing was broken--which is likely due to the fact that the credit union just repainted its walls, and had unstrapped all of its bookcases from the walls. "Our computers are up," she added.
But the building the credit union is located in has some damage, and there may be damage to other buildings on campus. A campus water main broke, and drywall cracked in other buildings. Glass is being cleaned up, and "I did hear some ambulances drive by," she said.
Earthquakes in the area happen about once every 15 years, she said. "We're used to it."
The California Credit Union League (CCUL), based in Rancho Cucamonga, Calif., is about nine to 10 miles from the quake's epicenter, Matt Buck CCUL public affairs specialist, told News Now.
"People felt the quake in Los Angeles and we felt the shaking here," Buck said. "But there was no damage, just one guy's Pez dispensers tipped over in the corner of our office."
"We haven't heard anything from credit unions," he added.
Western Corporate FCU's (WesCorp) facilities are located in San Dimas, about 10 miles from the epicenter.
"We haven't had a good shaker like that in years," Walter Laskos, public relations director at WesCorp, told News Now. "It caught people off guard and rattled our nerves, but nothing fell off the shelf.
"A lot of folks evacuated, but several remained and answered the phones. The first thing we do is check the critical systems immediately, such as the gas lines, and they were fine," he said.
WesCorp's building, which was visibly shaking, is built to hospital standards and can withstand an earthquake of 8.0 magnitude, he said.
WesCorp had no reports from credit unions of any damages, and Laskos was preparing a message to its member credit unions stating that WesCorp was operating. "It's business as usual."
Stan Hollen, president/CEO of CO-OP Financial Services, located in Rancho Cucamonga, told News Now, "It was a good jolt and lasted about eight seconds. You definitely felt it."
CO-OP's three-story building is seven miles from the epicenter, he said. Staff did not evacuate the building, but "we have a few rattled employees." The aftershock, which registered 3.8, was "barely noticeable."
ATMs in the CO-OP Network were undamaged. "We checked with the Network's operations center and no ATMs or lines are down," Hollen said.
courtesy of cuna.org
Tuesday, July 29, 2008
CUNA economist weighs in on savings trend
WASHINGTON (7/29/08)--Bill Hampel, chief economist for the Credit Union National Association, weighed in on the effect the U.S. housing crisis will have on savings in a Sunday article that appeared in ChicagoTribune.com .
Because homeowners can no longer use rising real estate valued to borrow cash, spending will fall, the article said. It originally ran in Bloomberg News.
After Americans go through their tax-rebate checks this summer, consumer spending will fall into negative territory, Hampel explained.
With mortgage lenders requiring 20% down payments, the average household--which saves less than 1% of after-tax pay--will have to save 10% for 10 years to buy a home.
The residential housing slump will "change the structure" of the U.S. economy and force Americans to save, Neil Soss, chief economist at New York-based Credit Suisse Group, said.
courtesy of cuna.org
Because homeowners can no longer use rising real estate valued to borrow cash, spending will fall, the article said. It originally ran in Bloomberg News.
After Americans go through their tax-rebate checks this summer, consumer spending will fall into negative territory, Hampel explained.
With mortgage lenders requiring 20% down payments, the average household--which saves less than 1% of after-tax pay--will have to save 10% for 10 years to buy a home.
The residential housing slump will "change the structure" of the U.S. economy and force Americans to save, Neil Soss, chief economist at New York-based Credit Suisse Group, said.
courtesy of cuna.org
Washington Post: CUs fill void when payday lenders leave
WASHINGTON (7/29/08)--Credit unions in the Washington, D.C., area are filling the void left by payday lenders who vacated the city after interest rates in the District were capped at 24% in January, says Saturday's Washington Post.
The article describes how Treasury Department FCU helped Stephanie Vann, a single mother, with a $500 six-month loan at 16% annual percentage rate--far lower than the typical payday loan rate of 300% and more. The credit union loan cleared her payday debt and put her on her feet. She now has a checking account at the credit union.
The Post noted that at least half a dozen credit unions are attempting to use payday lending alternatives as a tool to improve financial health of borrowers and that the credit unions' programs could be key in making the district's new interest-rate cap work without unintentionally harming low-income borrowers.
There's still a long way to go. The Post notes that "stretch pay" payday lending alternatives offered at 43 credit unions nationwide have issued 8,656 loans, with a few hundred made in Washington, D.C. That compares with 260,000 loans worth $125 million made by the two largest payday lenders in the district.
Jennifer Porter, chief advocacy officer at the Maryland and District of Columbia Credit Union Association, told the Post that district credit unions' willingness to pick up the small loans is actually a convergence of two trends--the district's move to cap interest rates charged by payday lenders and credit unions' already-in-progress payday loan alternatives.
The article also mentions Andrews CU, Clinton, Md.; CUNA Mutual Group; the Center for Responsible Lending; and HEW FCU, Alexandria, Va.
courtesy of cuna.org
The article describes how Treasury Department FCU helped Stephanie Vann, a single mother, with a $500 six-month loan at 16% annual percentage rate--far lower than the typical payday loan rate of 300% and more. The credit union loan cleared her payday debt and put her on her feet. She now has a checking account at the credit union.
The Post noted that at least half a dozen credit unions are attempting to use payday lending alternatives as a tool to improve financial health of borrowers and that the credit unions' programs could be key in making the district's new interest-rate cap work without unintentionally harming low-income borrowers.
There's still a long way to go. The Post notes that "stretch pay" payday lending alternatives offered at 43 credit unions nationwide have issued 8,656 loans, with a few hundred made in Washington, D.C. That compares with 260,000 loans worth $125 million made by the two largest payday lenders in the district.
Jennifer Porter, chief advocacy officer at the Maryland and District of Columbia Credit Union Association, told the Post that district credit unions' willingness to pick up the small loans is actually a convergence of two trends--the district's move to cap interest rates charged by payday lenders and credit unions' already-in-progress payday loan alternatives.
The article also mentions Andrews CU, Clinton, Md.; CUNA Mutual Group; the Center for Responsible Lending; and HEW FCU, Alexandria, Va.
courtesy of cuna.org
Monday, July 28, 2008
New tax deadlines for disaster victims, stimulus payment
WASHINGTON (7/28/08)--Disaster victims in seven states have until Aug. 29 to meet certain tax requirements, and persons who qualify but haven't yet filed for their 2008 stimulus payment have until Oct. 15 (IRS.gov July 14 and 18).
Here are the specifics:
Disaster victims. Victims who reside in counties declared presidential disaster areas in Indiana, Iowa, Illinois, Missouri, Nebraska, West Virginia, and Wisconsin have more time--until Aug. 29--to file certain tax returns and to make certain tax payments. For more information for your state, visit irs.gov and search "disaster Aug. 29";
Stimulus payment. More than five million people--retirees, disabled veterans and low-wage workers who normally don't file a tax return--haven't filed for an economic stimulus check, even though they're eligible (USA Today June 23). To get the stimulus payment, however, you must file a tax return. It's not too late. File your 2007 tax return by Oct. 15 if you have at least $3,000 in qualifying income, which includes any combination of earned income, nontaxable combat pay, and certain payments from Social Security, Veterans Affairs, and Railroad Retirement. For more information, visit irs.gov and type "stimulus payments it's not too late" in the search box.
courtesy of cuna.org
Here are the specifics:
Disaster victims. Victims who reside in counties declared presidential disaster areas in Indiana, Iowa, Illinois, Missouri, Nebraska, West Virginia, and Wisconsin have more time--until Aug. 29--to file certain tax returns and to make certain tax payments. For more information for your state, visit irs.gov and search "disaster Aug. 29";
Stimulus payment. More than five million people--retirees, disabled veterans and low-wage workers who normally don't file a tax return--haven't filed for an economic stimulus check, even though they're eligible (USA Today June 23). To get the stimulus payment, however, you must file a tax return. It's not too late. File your 2007 tax return by Oct. 15 if you have at least $3,000 in qualifying income, which includes any combination of earned income, nontaxable combat pay, and certain payments from Social Security, Veterans Affairs, and Railroad Retirement. For more information, visit irs.gov and type "stimulus payments it's not too late" in the search box.
courtesy of cuna.org
Illinois league advises, 'CUs a safe harbor'
NAPERVILLE, Ill. (7/28/08)--While some segments of the financial services industry are experiencing economic difficulties, Illinois credit unions remain safe and sound institutions for more than 2.7 million consumers who keep their money there, said the Illinois Credit Union League (ICUL).
There are about 8,500 credit unions nationwide, with more than 90 million consumers as members, holding about $800 billion in assets. In Illinois, more than 430 credit unions hold $20.8 billion in assets.
Member deposits in federal and almost all state-chartered credit unions are federally insured by the National Credit Union Administration (NCUA) through the National Credit Union Share Insurance Fund (NCUSIF), the league emphasized in a press release.
"Consumers who have federally insured funds in credit unions should rest assured that their deposits are safe up to at least $100,000 per account, with additional coverage of up to $250,000 for certain retirement accounts," said Dan Plauda, ICUL president/CEO.
The NCUSIF is in strong condition, with an equity ratio estimated at 1.24% for June 30, projected by year-end to be 1.28%, according to NCUA. Data from NCUA also show that Illinois credit unions are well capitalized, with an overall capital-to-asset ratio of 11.2%-- a capital cushion of $3.12 billion.
In addition, data compiled by the Credit Union National Association indicates that Illinois consumers, at a time when they are concerned about their economic futures, trust credit unions to be a "safe harbor" for their money. Savings at credit unions in Illinois grew by more than 6% in the 12 months ending March 2008.
When it comes to lending, credit unions operate in the best interests of their members and are more conservative, unlike other more traditional financial institutions that exist to build up profits for stockholders, the league said.
As a result, credit unions steered clear of the subprime crisis and other risky lending practices. Mortgages at Illinois credit unions grew by nearly 17% in the 12 months ending March 2008--at a time when mortgage loans have forced other lenders to scale back or close their doors entirely, the league said.
Also, Illinois credit union mortgage delinquencies at the end of the first quarter stood at 0.42%. First mortgage charge-offs were 0.05%.
"Credit unions as a whole are very sound places to do business and exist solely to serve the best interests of their members. The more than 2.7 million consumers who belong to an Illinois credit union can have full confidence in their stability during the current national economic downturn. Not one penny of federally insured funds has ever been lost by a credit union member," Plauda concluded.
courtesy of cuna.org
There are about 8,500 credit unions nationwide, with more than 90 million consumers as members, holding about $800 billion in assets. In Illinois, more than 430 credit unions hold $20.8 billion in assets.
Member deposits in federal and almost all state-chartered credit unions are federally insured by the National Credit Union Administration (NCUA) through the National Credit Union Share Insurance Fund (NCUSIF), the league emphasized in a press release.
"Consumers who have federally insured funds in credit unions should rest assured that their deposits are safe up to at least $100,000 per account, with additional coverage of up to $250,000 for certain retirement accounts," said Dan Plauda, ICUL president/CEO.
The NCUSIF is in strong condition, with an equity ratio estimated at 1.24% for June 30, projected by year-end to be 1.28%, according to NCUA. Data from NCUA also show that Illinois credit unions are well capitalized, with an overall capital-to-asset ratio of 11.2%-- a capital cushion of $3.12 billion.
In addition, data compiled by the Credit Union National Association indicates that Illinois consumers, at a time when they are concerned about their economic futures, trust credit unions to be a "safe harbor" for their money. Savings at credit unions in Illinois grew by more than 6% in the 12 months ending March 2008.
When it comes to lending, credit unions operate in the best interests of their members and are more conservative, unlike other more traditional financial institutions that exist to build up profits for stockholders, the league said.
As a result, credit unions steered clear of the subprime crisis and other risky lending practices. Mortgages at Illinois credit unions grew by nearly 17% in the 12 months ending March 2008--at a time when mortgage loans have forced other lenders to scale back or close their doors entirely, the league said.
Also, Illinois credit union mortgage delinquencies at the end of the first quarter stood at 0.42%. First mortgage charge-offs were 0.05%.
"Credit unions as a whole are very sound places to do business and exist solely to serve the best interests of their members. The more than 2.7 million consumers who belong to an Illinois credit union can have full confidence in their stability during the current national economic downturn. Not one penny of federally insured funds has ever been lost by a credit union member," Plauda concluded.
courtesy of cuna.org
Georgia CU Affiliates: Consumers still confident in CUs
DULUTH, Ga. (7/28/08)--Though consumer confidence in the financial services industry is shaky, Georgians have found safety in credit unions, according to Georgia Credit Union Affiliates (GCUA).
The percentage of Americans saying that they have a "great deal" of confidence in U.S. banks fell to 32%, according to a June 23 Gallup poll. That figure is down nine percentage points from June 2007 and 17 percentage points from June 2006.
About 1.8 million Georgians belong to a credit union, but many more have not discovered the benefits of belonging. "Credit unions might be one of the best kept secrets in financial services," said Mike Mercer, GCUA president.
Mortgages at Georgia credit unions grew by 14.9% for the past 12 months ending in March. Credit unions operate more conservatively and tend to hold more of their mortgage loans--70%--in portfolio rather than sell them to Fannie Mae and Freddie Mac in the secondary market, the league said.
The state's credit unions have a capital cushion of $1.84 billion. Credit union deposits are insured by the National Credit Union Share Insurance Fund up to $100,000.
courtesy of cuna.org
The percentage of Americans saying that they have a "great deal" of confidence in U.S. banks fell to 32%, according to a June 23 Gallup poll. That figure is down nine percentage points from June 2007 and 17 percentage points from June 2006.
About 1.8 million Georgians belong to a credit union, but many more have not discovered the benefits of belonging. "Credit unions might be one of the best kept secrets in financial services," said Mike Mercer, GCUA president.
Mortgages at Georgia credit unions grew by 14.9% for the past 12 months ending in March. Credit unions operate more conservatively and tend to hold more of their mortgage loans--70%--in portfolio rather than sell them to Fannie Mae and Freddie Mac in the secondary market, the league said.
The state's credit unions have a capital cushion of $1.84 billion. Credit union deposits are insured by the National Credit Union Share Insurance Fund up to $100,000.
courtesy of cuna.org
Friday, July 25, 2008
Miracle Makeover: Erin's New Room
These are pictures from the community project "Miracle Makeover" that we recently participated in as a credit union, along with other credit unions in Canyon County. We signed on to furnish Erin's new bedroom and study room and I am so pleased with the results.
If you would like to learn more about the Miracle Makeover Project visit http://miraclemakeover.blogspot.com
Thanks for visiting our blog!
Tia Davis, Marketing
Texas CUs batten down as Dolly hits coast
BROWNSVILLE, Texas (7/24/08)--With the eye of Hurricane Dolly making landfall Wednesday afternoon on South Padre Island, Texas, near Brownsville, some Texas credit unions had battened down the hatches in preparation.
The storm contained steady winds of 100 mph with gust reaching 120 mph, according to the National Hurricane Center in a Wednesday afternoon advisory (CNN.com> July 23).
All three credit unions located in Brownsville, Texas--Brownsville City Employees FCU, First Financial Community FCU, and Valley FCU--did not answer their phones when contacted Wednesday morning by News Now, and were assumed closed.
The Texas Credit Union League (TCUL) is monitoring the situation and has a Disaster Preparation page on its website to monitor Hurricane Dolly (use the link).
The Office of the Comptroller of the Currency issued a proclamation Wednesday allowing national bank offices affected by the hurricane to close at their discretion. Credit unions already are allowed the discretion to close if conditions warrant, according to John McKechnie of the National Credit Union Administration (NCUA). Therefore NCUA had no plans to issue a similar statement, McKechnie said.
An advisory issued Tuesday by the Commissioner of the Texas Credit Union Department stated:
"In conjunction with Gov. Perry's proclamation concerning the threat from Hurricane Dolly, the [Texas] Credit Union Department advises Texas state-chartered credit unions with offices in areas that may be affected by this hurricane to take appropriate precautions to safeguard property and personnel. The department notes that state-chartered credit unions in Texas have the authority ... to close offices threatened by an emergency if the department is notified as promptly as possible, by any means available."
CUNA Mutual Group also was taking steps on Wednesday to prepare for Dolly's landfall and aftermath.
"We're always concerned anytime a hurricane strikes land," Phil Tschudy, media relations manager, CUNA Mutual, told News Now. "While we have not contacted any credit unions at this point, we have activated our disaster team to handle any losses caused by this hurricane.
Fortunately, there are a limited number of credit unions in and around the Brownsville area.
"Due to the size of this particular storm, we don't anticipate it will have a large impact on our insureds," he continued. "Nonetheless, all hurricane-related loses will be handled on a priority basis. Credit unions can report losses by calling our disaster phone line, which is staffed 24/7/365, at 800-637-2676."
The National Credit Union Foundation (NCUF) will check with TCUL and the state credit union foundation in the aftermath of the hurricane to see if any help is needed, Steve Bosack, NCUF deputy director, told News Now.
"Generally, state foundations take the lead and assess damages and the impact on members. Then NCUF will contact the state foundations to see what help they need and if we can assist," Bosack explained.
courtesy of cuna.org
The storm contained steady winds of 100 mph with gust reaching 120 mph, according to the National Hurricane Center in a Wednesday afternoon advisory (CNN.com> July 23).
All three credit unions located in Brownsville, Texas--Brownsville City Employees FCU, First Financial Community FCU, and Valley FCU--did not answer their phones when contacted Wednesday morning by News Now, and were assumed closed.
The Texas Credit Union League (TCUL) is monitoring the situation and has a Disaster Preparation page on its website to monitor Hurricane Dolly (use the link).
The Office of the Comptroller of the Currency issued a proclamation Wednesday allowing national bank offices affected by the hurricane to close at their discretion. Credit unions already are allowed the discretion to close if conditions warrant, according to John McKechnie of the National Credit Union Administration (NCUA). Therefore NCUA had no plans to issue a similar statement, McKechnie said.
An advisory issued Tuesday by the Commissioner of the Texas Credit Union Department stated:
"In conjunction with Gov. Perry's proclamation concerning the threat from Hurricane Dolly, the [Texas] Credit Union Department advises Texas state-chartered credit unions with offices in areas that may be affected by this hurricane to take appropriate precautions to safeguard property and personnel. The department notes that state-chartered credit unions in Texas have the authority ... to close offices threatened by an emergency if the department is notified as promptly as possible, by any means available."
CUNA Mutual Group also was taking steps on Wednesday to prepare for Dolly's landfall and aftermath.
"We're always concerned anytime a hurricane strikes land," Phil Tschudy, media relations manager, CUNA Mutual, told News Now. "While we have not contacted any credit unions at this point, we have activated our disaster team to handle any losses caused by this hurricane.
Fortunately, there are a limited number of credit unions in and around the Brownsville area.
"Due to the size of this particular storm, we don't anticipate it will have a large impact on our insureds," he continued. "Nonetheless, all hurricane-related loses will be handled on a priority basis. Credit unions can report losses by calling our disaster phone line, which is staffed 24/7/365, at 800-637-2676."
The National Credit Union Foundation (NCUF) will check with TCUL and the state credit union foundation in the aftermath of the hurricane to see if any help is needed, Steve Bosack, NCUF deputy director, told News Now.
"Generally, state foundations take the lead and assess damages and the impact on members. Then NCUF will contact the state foundations to see what help they need and if we can assist," Bosack explained.
courtesy of cuna.org
Confusing world of credit scores--made simpler
NEW YORK (7/23/08)--A recent study, jointly conducted by the Consumer Federation of America and Washington Mutual Bank, revealed that although knowledge of credit scores has improved slightly among consumers, many still remain misinformed and confused. Why? Not all credit scores are created equal (SmartMoney.com July 10).
According to the study, 31% of consumers knew that lenders use credit scores to assess risk, 21% said they thought the score represents their financial resources to repay loans, and 41% didn't know that using a credit card's entire limit lowers their score. Many consumers believed marital status, residency, and education were factors in their credit score.
Your credit score--that three-digit number summarizing your credit history--is a critical factor in a lender's decision to grant you credit and at what rate. While lenders are the primary users of credit scores, some employers, landlords and insurance companies also use them to evaluate applicants.
Therein lies the problem. If you purchase your credit score from Fair Isaac Corp. at FICO.com, you get a FICO Score. If you request a free TransUnion or Experian credit report from annualcreditreport.com and also purchase your credit score from that website, however, you'll get a VantageScore. And if you use any of these sites--experian.com, freecreditreport.com, consumerinfo.com, creditexpert.com, or familysecure.com--you'll get a PLUS Score, which typically isn't used by lenders (SmartMoney.com May 1).
If you're not confused yet, try this: Each of these credit scores has a different numbering system, which means a score of 800 from FICO is considered very good, while the same score from VantageScore would be considered a grade equivalent to a "C."
If you can't remember all that, then remember this: Most mortgage lenders use the FICO Score.
The best advice, then, is to ask your lender which credit score it uses to determine your creditworthiness. Also, a clean credit history will boost all your credit scores. Before you apply for credit, take steps to clean up your credit report:
According to the study, 31% of consumers knew that lenders use credit scores to assess risk, 21% said they thought the score represents their financial resources to repay loans, and 41% didn't know that using a credit card's entire limit lowers their score. Many consumers believed marital status, residency, and education were factors in their credit score.
Your credit score--that three-digit number summarizing your credit history--is a critical factor in a lender's decision to grant you credit and at what rate. While lenders are the primary users of credit scores, some employers, landlords and insurance companies also use them to evaluate applicants.
Therein lies the problem. If you purchase your credit score from Fair Isaac Corp. at FICO.com, you get a FICO Score. If you request a free TransUnion or Experian credit report from annualcreditreport.com and also purchase your credit score from that website, however, you'll get a VantageScore. And if you use any of these sites--experian.com, freecreditreport.com, consumerinfo.com, creditexpert.com, or familysecure.com--you'll get a PLUS Score, which typically isn't used by lenders (SmartMoney.com May 1).
If you're not confused yet, try this: Each of these credit scores has a different numbering system, which means a score of 800 from FICO is considered very good, while the same score from VantageScore would be considered a grade equivalent to a "C."
If you can't remember all that, then remember this: Most mortgage lenders use the FICO Score.
The best advice, then, is to ask your lender which credit score it uses to determine your creditworthiness. Also, a clean credit history will boost all your credit scores. Before you apply for credit, take steps to clean up your credit report:
- Pay all bills on time;
- Keep each account balance at less than 25% of your available credit limit;
- Don't close old accounts--or open a flurry of new accounts--right before you apply for credit; and
- Don't co-sign for another person with bad--or no--credit.
For more information, read "Tough Times Series: Credit Savvy Is Key to Avoiding Costly Missteps" in Home & Family Resource Center.
courtesy of cuna.org
Study: Gens X, Y more likely to switch PFIs
ST. LOUIS (7/23/08)--Generation X and Y may be the future of retail banking, but they are the most likely to switch primary financial institutions (PFIs) because of fees or poor service, according to a poll by Maritz Inc.
That means credit unions and banks will be working harder to attract and keep these groups.
Maritz, a marketing services company based in St. Louis, surveyed 1,008 people and found that 53% of those in Gen X (30-42 years old) and 61% of Gen Y (18-29 years old) had either changed their PFI or considered doing so in the past two years. That compares with 20% of the Silent Generation and 37% of Baby Boomers surveyed.
"The current customer experience model at banks caters to the Silent Generation and the Boomers, who more frequently bank in person at branches," said Thad Peterson, division vice president, sector strategy and solutions of Maritz's financial services sector. "But younger generation customers are much more mobile and rely more heavily on online interactions," he said.
Financial institutions' "most unstable relationships exist with younger customers, because younger people often haven't settled into a stable financial pattern yet," he said. Institutions hoping to build long-term relationships with Gen Y and Gen X need to think about three basic steps, Peterson said:
That means credit unions and banks will be working harder to attract and keep these groups.
Maritz, a marketing services company based in St. Louis, surveyed 1,008 people and found that 53% of those in Gen X (30-42 years old) and 61% of Gen Y (18-29 years old) had either changed their PFI or considered doing so in the past two years. That compares with 20% of the Silent Generation and 37% of Baby Boomers surveyed.
"The current customer experience model at banks caters to the Silent Generation and the Boomers, who more frequently bank in person at branches," said Thad Peterson, division vice president, sector strategy and solutions of Maritz's financial services sector. "But younger generation customers are much more mobile and rely more heavily on online interactions," he said.
Financial institutions' "most unstable relationships exist with younger customers, because younger people often haven't settled into a stable financial pattern yet," he said. Institutions hoping to build long-term relationships with Gen Y and Gen X need to think about three basic steps, Peterson said:
- Attracting Gen Y and Gen X as customers/members in the first place. Locational convenience has been the primary tool for attracting new members/customers. That's still the case with the younger generations, but their definition of "locational convenience" is changing. Now it includes online and mobile transactions, and they expect anytime anywhere banking. Banks (and credit unions) need a strategy to attract and retain prospective customers who rarely step into a banking office, he said.
- Identifying and offering products that give young people "roots" at the bank or credit union. Example: provide incentives for online bill paying services and debit rewards programs.
- Treating the younger generations the way they want to be treated. Ensure that their member/customer experience is appropriate for Gen X and Gen Y, and consistent at all major banking touch points.
The survey indicates that young people can be more impatient, less tolerant and harder to please than their cohorts in the older generations. It also found that younger customers are more likely than older customers to find fault or have problems with their primary financial institutions. For example:
- 37% of Gen Y and 36% of Gen X believe they would get better customer service at a different bank;
- 22% of Gen Y and 21% of Gen X reported being upset in the past year about high fees, compared with 14% of Boomer and 6% of Silent Generation respondents; and
- 18% of Gen Y and 17% of Gen X reported being upset about a lack of ATM locations, compared with 11% of Boomers and 3% of the Silent Generation.
So how does a credit union reach Gen X and Y members? Businesses are beginning to reach out via social media such as Facebook, but Peterson warns against relying too heavily on social media to initially reach these groups.
"Using Facebook to attract new customers is like standing in a corner passing out business cards at a cocktail party," Peterson says. "If you don't have a genuine relationship with them, all you are going to accomplish is to diminish the value of your brand to that individual."
He suggests that financial institutions:
- Be the source or their primary debit card--Gen X and Y comprise the debit card generation;
- Highly "incent" them to migrate to online banking with a significant reward for paying bills online;
- Make sure front-line employees are treating Gen X and Y the way they want to be treated and can solve problems on the spot--a key to securing lifelong patrons; and
- Stay in tune with how younger customers want to connect--online banking, bill pay and mobile banking are three touchpoints that must be state-of-the-art and part of the overall customer experience.
courtesy of cuna.org
NBC News: Consider a CU in search for bank
NEW YORK (7/22/08)--Consumers should not rule out credit unions when looking for a place to bank, according to a financial editor appearing on the NBC News show "Sunday Today."
Stephanie Auwerter, editor of Smartmoney.com, discussed the economy, the failure of IndyMac Bank in California, and banking issues during the show.
When Auwerter was asked if consumers are better off with bigger banks as opposed to smaller banks, she responded:
"When you're looking for a bank, don't discount the small guys and your local credit union. You might find that the fees are lower and their interest rates are higher. They may be willing to work a little harder to get your dollars."
courtesy of cuna.org
Stephanie Auwerter, editor of Smartmoney.com, discussed the economy, the failure of IndyMac Bank in California, and banking issues during the show.
When Auwerter was asked if consumers are better off with bigger banks as opposed to smaller banks, she responded:
"When you're looking for a bank, don't discount the small guys and your local credit union. You might find that the fees are lower and their interest rates are higher. They may be willing to work a little harder to get your dollars."
courtesy of cuna.org
More leagues join CUNA to reassure members of soundness
MADISON, Wis. (7/22/08)--Several more credit union leagues have joined the Credit Union National Association (CUNA) and credit unions in reassuring credit union members that their deposits are safe.
The Indiana Credit Union League has released a statement with information about credit unions' safety, including facts about Indiana credit unions. John McKenzie, league president, also sent letters to credit union CEOs with background on the safety and soundness issue, Kay Neidlinger, vice president of league communications, told News Now.
The Credit Union Associations of Colorado and Wyoming sent memos to its credit unions about the issue. It is offering two free webinar sessions on National Credit Union Administration Share Insurance Thursday and on July 30. The hour-long sessions will provide information on share insurance rules and teach attendees how to calculate coverage on member accounts.
The association also sent a media alert with background information on the states' credit unions and their capital. Overall, Colorado and Wyoming credit unions are well-capitalized which means they are able to weather problems caused by the current economic crisis, the association said.
Sample newsletter articles and talking points also were produced and sent to local media, the association said.
CUNA President/CEO Dan Mica Monday sent out an update with information on how it is spreading the word on credit unions' safety and soundness. CUNA has contacted national media outlets, such as CNN, USA Today and Fox Business Network and sent letters to members of Congress. It also sent out talking points and resources for credit unions to use when reassuring their members and communicating with local media.
CUNA's NewsWatch also is putting together a special edition highlighting the safety and soundness of credit unions.
courtesy of cuna.org
The Indiana Credit Union League has released a statement with information about credit unions' safety, including facts about Indiana credit unions. John McKenzie, league president, also sent letters to credit union CEOs with background on the safety and soundness issue, Kay Neidlinger, vice president of league communications, told News Now.
The Credit Union Associations of Colorado and Wyoming sent memos to its credit unions about the issue. It is offering two free webinar sessions on National Credit Union Administration Share Insurance Thursday and on July 30. The hour-long sessions will provide information on share insurance rules and teach attendees how to calculate coverage on member accounts.
The association also sent a media alert with background information on the states' credit unions and their capital. Overall, Colorado and Wyoming credit unions are well-capitalized which means they are able to weather problems caused by the current economic crisis, the association said.
Sample newsletter articles and talking points also were produced and sent to local media, the association said.
CUNA President/CEO Dan Mica Monday sent out an update with information on how it is spreading the word on credit unions' safety and soundness. CUNA has contacted national media outlets, such as CNN, USA Today and Fox Business Network and sent letters to members of Congress. It also sent out talking points and resources for credit unions to use when reassuring their members and communicating with local media.
CUNA's NewsWatch also is putting together a special edition highlighting the safety and soundness of credit unions.
courtesy of cuna.org
Monday, July 21, 2008
Your credit union accounts are safe, insured
MADISON, Wis. (7/21/08)—Credit unions remain a safe harbor for your savings and other accounts, despite economic woes, including the recent IndyMac bank failure. Thanks to federal insurance—members' shares are backed by the full faith and credit of the U.S. Treasury (CUNA Center for Personal Finance).
There's no better time to be a credit union member. Virtually all credit unions are insured by the National Credit Union Share Insurance Fund (NCUSIF), which insures savings of at least up to $100,000 per account. Certain retirement accounts such as IRAs and Keoghs benefit from additional coverage of up to $250,000. For the fewer than 170 credit unions with private deposit insurance, their equity ratio typically is even higher than the federal fund, and state regulators oversee these privately insured credit unions.
NCUSIF's equity-to-insured deposits are estimated at a strong 1.24% as of June 30 and projected to increase to 1.28% by year-end, according to the National Credit Union Association (NCUA).
Credit unions are nationally recognized for having steered clear of the subprime mortgage mess by lending responsibly and holding more of their mortgage loans—roughly 70%—in their portfolios instead of selling them on the secondary market to beleaguered Fannie Mae and Freddie Mac. Also, credit unions have a better capital-to-asset ratio—11.1% compared with 10% for banks.
What does share insurance coverage mean for you?
If you have more than one single-ownership account in the same credit union, all those account balances are added together and insured in the aggregate, to the maximum of $100,000.
If you have a joint account at the same credit union, that account is insured separately from your individual account up to the $100,000 level, provided each of you has personally signed an account signature card and each of you has a right of withdrawal on the same basis. Each individual's interests in all jointly held accounts are added together and insured up to $100,000;
If you have accounts at more than one insured credit union, you have coverage up to the full insurable amount in each credit union. If your credit union has one or more branches, the main office and all branch offices are considered as one credit union;
If you have a revocable trust account, such as payable-on-death, living trust, or testamentary account, insurance coverage for each account is up to $100,000 per owner for each qualified beneficiary; and
While IRAs and Keogh accounts are insured separately from nonretirement funds, with each type insured up to $250,000, funds in traditional IRAs and Roth IRAs are added together and insured in the aggregate up to $250,000. Coverdell Education Savings Accounts are treated as irrevocable trust accounts and added in with your other irrevocable trust account funds and insured separately up to $100,000.
Bottom line: Depending on how your accounts are established, funds in a federally insured credit union can be insured to a level much higher than $100,000. For more information about the specifics of your insurance coverage, visit with the professionals at the credit union.
For more information, read, "Credit Union ... Bank ... What's the Difference?" in Home & Family Resource Center.
courtesy of cuna.org
There's no better time to be a credit union member. Virtually all credit unions are insured by the National Credit Union Share Insurance Fund (NCUSIF), which insures savings of at least up to $100,000 per account. Certain retirement accounts such as IRAs and Keoghs benefit from additional coverage of up to $250,000. For the fewer than 170 credit unions with private deposit insurance, their equity ratio typically is even higher than the federal fund, and state regulators oversee these privately insured credit unions.
NCUSIF's equity-to-insured deposits are estimated at a strong 1.24% as of June 30 and projected to increase to 1.28% by year-end, according to the National Credit Union Association (NCUA).
Credit unions are nationally recognized for having steered clear of the subprime mortgage mess by lending responsibly and holding more of their mortgage loans—roughly 70%—in their portfolios instead of selling them on the secondary market to beleaguered Fannie Mae and Freddie Mac. Also, credit unions have a better capital-to-asset ratio—11.1% compared with 10% for banks.
What does share insurance coverage mean for you?
If you have more than one single-ownership account in the same credit union, all those account balances are added together and insured in the aggregate, to the maximum of $100,000.
If you have a joint account at the same credit union, that account is insured separately from your individual account up to the $100,000 level, provided each of you has personally signed an account signature card and each of you has a right of withdrawal on the same basis. Each individual's interests in all jointly held accounts are added together and insured up to $100,000;
If you have accounts at more than one insured credit union, you have coverage up to the full insurable amount in each credit union. If your credit union has one or more branches, the main office and all branch offices are considered as one credit union;
If you have a revocable trust account, such as payable-on-death, living trust, or testamentary account, insurance coverage for each account is up to $100,000 per owner for each qualified beneficiary; and
While IRAs and Keogh accounts are insured separately from nonretirement funds, with each type insured up to $250,000, funds in traditional IRAs and Roth IRAs are added together and insured in the aggregate up to $250,000. Coverdell Education Savings Accounts are treated as irrevocable trust accounts and added in with your other irrevocable trust account funds and insured separately up to $100,000.
Bottom line: Depending on how your accounts are established, funds in a federally insured credit union can be insured to a level much higher than $100,000. For more information about the specifics of your insurance coverage, visit with the professionals at the credit union.
For more information, read, "Credit Union ... Bank ... What's the Difference?" in Home & Family Resource Center.
courtesy of cuna.org
USA Today: CUs a good place for consumer savings
MADISON, Wis. (7/21/08)--With ongoing economic turmoil and problems with some financial institutions, many people are wondering where the best place is to put their savings.
USA TODAY personal finance columnist John Waggoner, mentioned credit unions as a viable option Friday in his column.
Waggoner spoke with Bill Hampel, chief economist at the Credit Union National Association (CUNA), before he wrote the column, "Where can you stash your cash," which dealt with options for consumers trying to safely save in difficult financial times.
Often, credit unions will pay higher yields because they are non-profit organizations that don't pay federal taxes, Waggoner noted.
Credit unions' deposits also are federally insured, he added.
In other news, Hampel appeared on FOX News Friday. "Credit unions are very safe and sound," he told the news outlet. "Depositors have nothing to worry about."
Loss rates at credit unions also are very low, he added. "You can count on one hand the number of credit unions that will likely fail," he said.
courtesy of cuna.org
USA TODAY personal finance columnist John Waggoner, mentioned credit unions as a viable option Friday in his column.
Waggoner spoke with Bill Hampel, chief economist at the Credit Union National Association (CUNA), before he wrote the column, "Where can you stash your cash," which dealt with options for consumers trying to safely save in difficult financial times.
Often, credit unions will pay higher yields because they are non-profit organizations that don't pay federal taxes, Waggoner noted.
Credit unions' deposits also are federally insured, he added.
In other news, Hampel appeared on FOX News Friday. "Credit unions are very safe and sound," he told the news outlet. "Depositors have nothing to worry about."
Loss rates at credit unions also are very low, he added. "You can count on one hand the number of credit unions that will likely fail," he said.
courtesy of cuna.org
Friday, July 18, 2008
CU members can bank through Blackberrys
BASKING RIDGE, N.J. (7/18/08)--Credit union members with Blackberrys under a Verizon Wireless contract can now participate in mobile banking.
America First CU, Ogden, Utah, and BECU, Seattle, are two credit unions that offer the service for Blackberry users.
Members can get account balances and transaction history, transfer funds, view and pay bills, and view the last five transactions completed on their mobile devices, Verizon said in a press release Thursday.
courtesy of cuna.org
America First CU, Ogden, Utah, and BECU, Seattle, are two credit unions that offer the service for Blackberry users.
Members can get account balances and transaction history, transfer funds, view and pay bills, and view the last five transactions completed on their mobile devices, Verizon said in a press release Thursday.
courtesy of cuna.org
CU robbery suspects arrested after seven-hour standoff
WEST VALLEY CITY, Utah (7/18/08)--Men suspected of robbing a West Valley City branch of Salt Lake City-based Premier Services CU were arrested by police Tuesday after a seven-hour standoff at a home in the area, according to media reports.
Two men, one carrying a handgun, entered Premier Services CU Tuesday afternoon at 2:45 p.m. and ordered the branch's three employees to the floor. They emptied the cash register and left, Dennis Murray, Premier Services CU CEO, told News Now.
No employees were injured during the robbery, but they were shaken, Murray said.
Murray confirmed that the credit union's employees saw two men, but noted that a witness outside of the credit union said she saw a third individual in a car that the robbers used to escape. He later learned from media reports that police arrested six individuals at a standoff, he said.
John Bizzle, 20, Corey Morrison, 18, and George Dumas, 58, were arrested for the Premier Services CU robbery and are being held in a local jail, according to the Salt Lake Tribune (July 16).
Three others, whose names have not yet been released, also were arrested at the standoff. The robbery at Premier Services CU took place about one hour before the standoff, West Valley Police Capt. Steve Sandquist told the Tribune.
The credit union has not yet stated the amount of money stolen in the incident.
courtesy of cuna.org
Two men, one carrying a handgun, entered Premier Services CU Tuesday afternoon at 2:45 p.m. and ordered the branch's three employees to the floor. They emptied the cash register and left, Dennis Murray, Premier Services CU CEO, told News Now.
No employees were injured during the robbery, but they were shaken, Murray said.
Murray confirmed that the credit union's employees saw two men, but noted that a witness outside of the credit union said she saw a third individual in a car that the robbers used to escape. He later learned from media reports that police arrested six individuals at a standoff, he said.
John Bizzle, 20, Corey Morrison, 18, and George Dumas, 58, were arrested for the Premier Services CU robbery and are being held in a local jail, according to the Salt Lake Tribune (July 16).
Three others, whose names have not yet been released, also were arrested at the standoff. The robbery at Premier Services CU took place about one hour before the standoff, West Valley Police Capt. Steve Sandquist told the Tribune.
The credit union has not yet stated the amount of money stolen in the incident.
courtesy of cuna.org
California CUs flooded by former IndyMac clients
LOS ANGELES (7/18/08)--California credit unions have seen a flood of IndyMac customers after the troubled thrift was taken over by federal regulators last week, reports the San Gabriel Valley Tribune (7/18/08).
E-Central CU and Wescom CU in Pasadena both told the newspaper that former IndyMac customers' inquiries have focused on safety, security and deposit insurance.
Wescom spokesman Joe Schaeffer said consumers seem to be looking for "some level of comfort and reassurance." Many new members have parked their funds in money markets because it's safe and liquid.
Pasadena-based IndyMac Bancorp Inc., suffered a severe downward slide in recent months as a result of a meltdown in the nation's housing and mortgage markets.
E-Central President/CEO Mike Theodore said he believed the mortgage lender's demise "was greed related."
"That's the difference between a for-profit company and a not-for-profit company," he told the newspaper, which pointed out that credit unions are non-profit institutions owned and operated entirely by their members.
Meanwhile, other California newspapers reported the state's more than 500 credit unions "remain safe and sound and continue to demonstrate positive growth."
California Credit Union League Analyst Daniel Penrod told the Fontana Herald News "while other financial institutions are experiencing financial difficulties and restricting services, California credit unions are well capitalized and in a great position to continue serving consumers."
He reiterated that credit union deposits are insured by the "National Credit Union Administration, an agency of the federal government, up to $100,000 per account with additional coverage of up to $250,000 for certain retirement accounts, and also by private insurers," said Penrod.
"Not one cent of taxpayer funds has ever been used to bail out a credit union," he said.
courtesy of cuna.org
E-Central CU and Wescom CU in Pasadena both told the newspaper that former IndyMac customers' inquiries have focused on safety, security and deposit insurance.
Wescom spokesman Joe Schaeffer said consumers seem to be looking for "some level of comfort and reassurance." Many new members have parked their funds in money markets because it's safe and liquid.
Pasadena-based IndyMac Bancorp Inc., suffered a severe downward slide in recent months as a result of a meltdown in the nation's housing and mortgage markets.
E-Central President/CEO Mike Theodore said he believed the mortgage lender's demise "was greed related."
"That's the difference between a for-profit company and a not-for-profit company," he told the newspaper, which pointed out that credit unions are non-profit institutions owned and operated entirely by their members.
Meanwhile, other California newspapers reported the state's more than 500 credit unions "remain safe and sound and continue to demonstrate positive growth."
California Credit Union League Analyst Daniel Penrod told the Fontana Herald News "while other financial institutions are experiencing financial difficulties and restricting services, California credit unions are well capitalized and in a great position to continue serving consumers."
He reiterated that credit union deposits are insured by the "National Credit Union Administration, an agency of the federal government, up to $100,000 per account with additional coverage of up to $250,000 for certain retirement accounts, and also by private insurers," said Penrod.
"Not one cent of taxpayer funds has ever been used to bail out a credit union," he said.
courtesy of cuna.org
Hampel to Bloomberg: Consumer spending will go negative
WASHINGTON (7/18/08)--As the continuing U.S. housing crisis is leading more Americans to save rather than spend, consumer spending will soon head into negative territory, Bill Hampel, chief economist at the Credit Union National Association, told Blooomberg Wednesday.
Spending will decline because homeowners can no longer borrow cash by using rising real estate value as collateral, the article said.
Also, lenders will issue 53% less purchase-mortgages in 2008 compared with 2006, which will impede home sales and slow down a housing recovery, Guy Cecala, publisher of industry newsletter Inside Mortgage Finance, told Bloomberg .
U.S. consumers borrowed $837.5 billion in 2006, according to a report by former Federal Reserve Chairman Alan Greenspan and Senior Fed Economist James Kennedy, Bloomberg reported.
While rising 7.5% since the beginning of last year, consumer spending will drop into negative territory after Americans use up their tax rebate checks this summer, Hampel told Bloomberg.
courtesy of cuna.org
Spending will decline because homeowners can no longer borrow cash by using rising real estate value as collateral, the article said.
Also, lenders will issue 53% less purchase-mortgages in 2008 compared with 2006, which will impede home sales and slow down a housing recovery, Guy Cecala, publisher of industry newsletter Inside Mortgage Finance, told Bloomberg .
U.S. consumers borrowed $837.5 billion in 2006, according to a report by former Federal Reserve Chairman Alan Greenspan and Senior Fed Economist James Kennedy, Bloomberg reported.
While rising 7.5% since the beginning of last year, consumer spending will drop into negative territory after Americans use up their tax rebate checks this summer, Hampel told Bloomberg.
courtesy of cuna.org
Thursday, July 17, 2008
Leagues, CUNA reassure members their money is safe
MADISON, Wis. (7/17/08)--Credit union leagues nationwide are reassuring members their money is safe after media reports regarding the IndyMac bank failure triggered concerns among consumers about the security of their deposits.
The Credit Union National Association (CUNA) also distributed a list of talking points for leagues to share with local media about the safety and soundness of credit unions. That factsheet is prominently posted on cuna.org and the consumer website, creditunion.coop.
Several leagues, including the Missouri Credit Union Association (MCUA), have been contacted by credit unions receiving calls from worried members. MCUA also corrected erroneous information about credit union deposits that aired on a local radio station, said Peggy Nalls, senior vice president of public and legislative affairs.
"A radio station in St. Louis ran an interview Wednesday morning with a book author who said he didn't know if credit union accounts are insured," Nalls told News Now. "Amy McLard [vice president of public/legislative affairs] contacted the station and followed up with an e-mail to set them straight."
The Louisiana Credit Union League hosted a seminar July 10 in Baton Rouge led by National Credit Union Administration (NCUA) Insurance Analyst Deborah Spearing, according to Lacey Hyer, league public relations specialist.
"Not one penny of insured savings has ever been lost by a member of a federally insured credit union," Spearing told attendees. "In these uncertain economic times, credit union members are looking for a safe, sound place to invest their hard-earned money. And the credit union is just that place."
Leagues also are putting together materials to distribute to credit unions and members and publishing stories in their newsletters to get the word out.
The Maine Credit Union League created an insert and news article for credit unions to distribute to members called "Is My Money Safe--For Credit Union Members, the Answer is Yes!"
The Credit Union Association of Colorado and Wyoming put together a mini-communications kit for credit unions including talking points for staff, sample letters for members to be posted on websites, sample newsletter articles, how to link to the National Credit Union Administration Share Insurance estimator and background information for press releases.
The Pennsylvania Credit Union Association published an article in Life is a Highway Wednesday and sent a release noting credit union savings rates. "In 2008, savings in credit unions have grown nearly 7%. Research estimates that Pennsylvania credit unions provided $387 million in direct financial benefits to the state's 3,388,545 members during the 12 months ending December 2007," the league said. "These benefits are equivalent to $114 per member or $217 per member household."
The Delaware Credit Union League plans to conduct "a survey to see how many credit unions received comments or questions from their members on this matter," Alice Smith, league communications and governmental affairs director, told News Now.
The California and Nevada Credit Union Leagues are encouraging credit unions to post messages on their websites and in newsletters. The leagues also encouraged credit unions to hold meetings with staff to make sure they are fully advised about safety and soundness issues, said Henry Kertman, league vice president of public affairs.
The Credit Union Association of New York also sent information to its credit unions. "Credit unions always have and will continue to lend responsibly, which is why they have been able to steer clear of the subprime crisis that is negatively impacting other financial institutions," said William J.Mellin, president/CEO of the Association. "It's also why New York's credit unions, which count over 4.2 million members and have more than $40 billion in assets, have gone virtually unmentioned in the adverse financial headlines that have proliferated the news."
Georgia Credit Union Affiliates released information about how state credit unions are helping those in times of crisis. In response to the recent IndyMac collapse, CSRA FCU, Augusta, is helping its members by allowing them to restructure their accounts with balances over $100,000, free of any early withdrawal fees, according to the league.
CSRA CEO Charm McCall said the offer demonstrates to members that the credit union wants to ease any concerns members might have about their money.
"Our members know that their deposits are insured up to $100,000 by the National Credit Union Share Insurance Fund (NCUSIF). We want to reassure our members that their money is safe at CSRA," McCall said. "If a member is more comfortable to restructure their certificates and shares with us, we can walk them through the process."
The Credit Union Association of Oregon also sent a release to credit unions. "Oregon credit unions, which count over 1.4 million members and hold nearly 27% of our state's financial market share, are going largely unmentioned in the adverse financial headlines," the association said. One hundred percent of Oregon credit unions are insured under NCUSIF, it added.
The North Carolina Credit Union League noted the issue in Weekly Update, and provided some resources for credit unions. "The bottom line," said John Radebaugh, league president, "is that credit unions are strong and well-positioned to serve their 3 million members in NC. They entered into this economic situation with strong balance sheets, and they will still be in very strong shape when things improve."
Wisconsin credit unions remain largely unaffected by the nation's mortgage crisis and economic downturn, the Wisconsin Credit Union League said in a press release Tuesday. Credit unions have remained strong because their community-based member-ownership puts members' interests first, according to Brett Thompson, Wisconsin league president/CEO.
At the end of first-quarter 2008, Wisconsin credit unions' delinquencies remained at 1.20%, a decrease from the year-end 2007 rate of 1.29%. Net charge offs, or loans that are unrecoverable, are at .33%.
"These figures show that credit unions have been making loans in their members' best interest," Thompson said. "Credit unions understand that members' ability to repay loans in a timely manner affects the stability of the cooperative, and as we've seen, our state's financial co-ops remain strong."
courtesy of cuna.org
The Credit Union National Association (CUNA) also distributed a list of talking points for leagues to share with local media about the safety and soundness of credit unions. That factsheet is prominently posted on cuna.org and the consumer website, creditunion.coop.
Several leagues, including the Missouri Credit Union Association (MCUA), have been contacted by credit unions receiving calls from worried members. MCUA also corrected erroneous information about credit union deposits that aired on a local radio station, said Peggy Nalls, senior vice president of public and legislative affairs.
"A radio station in St. Louis ran an interview Wednesday morning with a book author who said he didn't know if credit union accounts are insured," Nalls told News Now. "Amy McLard [vice president of public/legislative affairs] contacted the station and followed up with an e-mail to set them straight."
The Louisiana Credit Union League hosted a seminar July 10 in Baton Rouge led by National Credit Union Administration (NCUA) Insurance Analyst Deborah Spearing, according to Lacey Hyer, league public relations specialist.
"Not one penny of insured savings has ever been lost by a member of a federally insured credit union," Spearing told attendees. "In these uncertain economic times, credit union members are looking for a safe, sound place to invest their hard-earned money. And the credit union is just that place."
Leagues also are putting together materials to distribute to credit unions and members and publishing stories in their newsletters to get the word out.
The Maine Credit Union League created an insert and news article for credit unions to distribute to members called "Is My Money Safe--For Credit Union Members, the Answer is Yes!"
The Credit Union Association of Colorado and Wyoming put together a mini-communications kit for credit unions including talking points for staff, sample letters for members to be posted on websites, sample newsletter articles, how to link to the National Credit Union Administration Share Insurance estimator and background information for press releases.
The Pennsylvania Credit Union Association published an article in Life is a Highway Wednesday and sent a release noting credit union savings rates. "In 2008, savings in credit unions have grown nearly 7%. Research estimates that Pennsylvania credit unions provided $387 million in direct financial benefits to the state's 3,388,545 members during the 12 months ending December 2007," the league said. "These benefits are equivalent to $114 per member or $217 per member household."
The Delaware Credit Union League plans to conduct "a survey to see how many credit unions received comments or questions from their members on this matter," Alice Smith, league communications and governmental affairs director, told News Now.
The California and Nevada Credit Union Leagues are encouraging credit unions to post messages on their websites and in newsletters. The leagues also encouraged credit unions to hold meetings with staff to make sure they are fully advised about safety and soundness issues, said Henry Kertman, league vice president of public affairs.
The Credit Union Association of New York also sent information to its credit unions. "Credit unions always have and will continue to lend responsibly, which is why they have been able to steer clear of the subprime crisis that is negatively impacting other financial institutions," said William J.Mellin, president/CEO of the Association. "It's also why New York's credit unions, which count over 4.2 million members and have more than $40 billion in assets, have gone virtually unmentioned in the adverse financial headlines that have proliferated the news."
Georgia Credit Union Affiliates released information about how state credit unions are helping those in times of crisis. In response to the recent IndyMac collapse, CSRA FCU, Augusta, is helping its members by allowing them to restructure their accounts with balances over $100,000, free of any early withdrawal fees, according to the league.
CSRA CEO Charm McCall said the offer demonstrates to members that the credit union wants to ease any concerns members might have about their money.
"Our members know that their deposits are insured up to $100,000 by the National Credit Union Share Insurance Fund (NCUSIF). We want to reassure our members that their money is safe at CSRA," McCall said. "If a member is more comfortable to restructure their certificates and shares with us, we can walk them through the process."
The Credit Union Association of Oregon also sent a release to credit unions. "Oregon credit unions, which count over 1.4 million members and hold nearly 27% of our state's financial market share, are going largely unmentioned in the adverse financial headlines," the association said. One hundred percent of Oregon credit unions are insured under NCUSIF, it added.
The North Carolina Credit Union League noted the issue in Weekly Update, and provided some resources for credit unions. "The bottom line," said John Radebaugh, league president, "is that credit unions are strong and well-positioned to serve their 3 million members in NC. They entered into this economic situation with strong balance sheets, and they will still be in very strong shape when things improve."
Wisconsin credit unions remain largely unaffected by the nation's mortgage crisis and economic downturn, the Wisconsin Credit Union League said in a press release Tuesday. Credit unions have remained strong because their community-based member-ownership puts members' interests first, according to Brett Thompson, Wisconsin league president/CEO.
At the end of first-quarter 2008, Wisconsin credit unions' delinquencies remained at 1.20%, a decrease from the year-end 2007 rate of 1.29%. Net charge offs, or loans that are unrecoverable, are at .33%.
"These figures show that credit unions have been making loans in their members' best interest," Thompson said. "Credit unions understand that members' ability to repay loans in a timely manner affects the stability of the cooperative, and as we've seen, our state's financial co-ops remain strong."
courtesy of cuna.org
Wednesday, July 16, 2008
Avoid decimal point blues when paying bills online
WASHINGTON (7/16/08)--An easy way to "go green" with finances is to pay bills online. But you quickly can wipe out the benefits of online bill payment if you accidentally ditch the decimal point, add zeros when you don't have to, or neglect to take adequate precautions with your private information (AARP Magazine July/August 2008).
Online bill-pay clearly is safer than receiving paper statements and sending paper checks via snail mail--crooks can heist account numbers from mailed credit card bills, steal Social Security numbers from unsecured documents, or run off with incoming mail from unlocked mailboxes. Or, your payment could be misdirected or lost altogether.
Good advice: Don't type "00" to indicate "no cents." If you accidentally misplace the decimal point when entering the amount, and have used the 00s, you may unwittingly authorize a payment 100 times the intended amount. You need only enter the whole dollars, for example, $68, not $68.00. Some software automatically will fill in the cents columns for you.
If you use online banking to pay your bills, be aware of some simple do's and don'ts:
Online bill-pay clearly is safer than receiving paper statements and sending paper checks via snail mail--crooks can heist account numbers from mailed credit card bills, steal Social Security numbers from unsecured documents, or run off with incoming mail from unlocked mailboxes. Or, your payment could be misdirected or lost altogether.
Good advice: Don't type "00" to indicate "no cents." If you accidentally misplace the decimal point when entering the amount, and have used the 00s, you may unwittingly authorize a payment 100 times the intended amount. You need only enter the whole dollars, for example, $68, not $68.00. Some software automatically will fill in the cents columns for you.
If you use online banking to pay your bills, be aware of some simple do's and don'ts:
- Do install a firewall. Visit download.com for software reviews and downloads.
- Do use caution with automated payments. AARP recommends using automated payments only for mortgage payments or savings plans--typically those with consistent payment amounts over time.
- Do check your budget often. Will you have sufficient funds in your account by the payment date?
- Do a double-take. Log back in later and make sure the payments were sent and processed correctly.
- Don't click "Send" too quickly. Is the decimal point in the right place? Did you type the amount correctly?
- Don't forget to log out. Avoid public computers for any type of financial activity, and never use the "Remember my password" option--even at home.
- Don't hand over personal information. If you're asked for personal information in an e-mail message or over the phone, that's a red flag. Hit delete or hang up.
And remember, your credit union would never call to ask you this type of information; it already has the information on file.
courtesy of cuna.org
Pa. CUs share ideas on coping with high gas prices
HARRSIBURG, Pa. (7/16/08)--The Pennsylvania Credit Union Association (PCUA) recently solicited ideas from credit unions and employees on gas-saving policies and other transportation cost-cutting efforts.
Rising energy costs can cause stress on employees, and even impact worker productivity, PCUA said. By listening to employees, providing education on managing finances, being creative and thinking non-traditionally, employers can be leaders in helping employees (Life is a Highway July 15).
Some examples of what Pennsylvania credit unions are doing to ease the gas pinch:
Rising energy costs can cause stress on employees, and even impact worker productivity, PCUA said. By listening to employees, providing education on managing finances, being creative and thinking non-traditionally, employers can be leaders in helping employees (Life is a Highway July 15).
Some examples of what Pennsylvania credit unions are doing to ease the gas pinch:
- Employees of AT&T Employees Pittsburgh, Pa. FCU are compensated $2 for each day they work. They are reimbursed on a monthly basis. The new benefit was implemented Jan. 1 and will be ongoing.
- Incol CU, Old Forge, has adjusted its monthly staff meeting schedule. Rather than asking all employees to drive to the main office for the meeting, information packets are sent out to branch employees in advance. The meetings are then conducted via conference call--which also has reduced expenses for the credit union, because food was provided for the in-person meetings.
- Timberland FCU in DuBois and Clearfield purchases large quantities of fuel cards for area gas stations. The credit union gets a 5% discount. These cards, in turn, are sold to employees at the discount. The credit union also received permission to resell the cards to members as a fundraiser. A $50 gas card is being sold for $48.50, and $1 goes to charity for each card sold.
- Employees at Viriva Community CU, Philadelphia, have worked to better coordinate trips between the credit union's five branches. Teresa Hilinski, Viriva marketing manager, says staff from various departments used to make their own trips to branches. Now, items are gathered from departments and sent with the next person making a trip. The credit union is enforcing carpooling among employees when staff meetings are held at one location.
PCUA also is considering options for staff. Management appointed a six-person task force to research and provide recommendations on what could be done to help employees. The committee has submitted a report to management for consideration.
courtesy of cuna.org
Study: CUs should market to Gen X, Y through e-mail
BOSTON (7/16/08)--Credit unions looking to market to members of Generations X and Y may want to reference a recent study indicating that e-mail is one of the most effective ways to reach them.
Aite Group surveyed a group of 500 consumers to see in which channels--e-mail, online, at the ATM, or on their cell phones--they would most like to receive marketing offers.
While nearly six in 10 consumers said they are open to receiving offers from at least one of four common marketing channels, four in 10 said they would like to receive special offers and coupons through e-mail, Aite said.
Gen X demonstrated the strongest interest--53%--in e-mail marketing, followed by Gen Y at 47%.
Baby boomers are less interested, and senior citizens demonstrate the least interest in being contacted through e-mail for marketing purposes.
"While a surprisingly high number of consumers are open to receiving marketing offers, financial services marketers must take certain measures to capitalize on the opportunity," said Ron Shevlin, senior analyst with Aite Group and report author. "They must develop channel preference models, integrate marketing technologies and improve consumer trust in e-mail."
courtesy of cuna.org
Aite Group surveyed a group of 500 consumers to see in which channels--e-mail, online, at the ATM, or on their cell phones--they would most like to receive marketing offers.
While nearly six in 10 consumers said they are open to receiving offers from at least one of four common marketing channels, four in 10 said they would like to receive special offers and coupons through e-mail, Aite said.
Gen X demonstrated the strongest interest--53%--in e-mail marketing, followed by Gen Y at 47%.
Baby boomers are less interested, and senior citizens demonstrate the least interest in being contacted through e-mail for marketing purposes.
"While a surprisingly high number of consumers are open to receiving marketing offers, financial services marketers must take certain measures to capitalize on the opportunity," said Ron Shevlin, senior analyst with Aite Group and report author. "They must develop channel preference models, integrate marketing technologies and improve consumer trust in e-mail."
courtesy of cuna.org
Point Loma CU helps migrant children learn
OCEANSIDE, Calif. (7/16/08)--Point Loma CU (PLCU) is assisting the San Diego County Office of Education's Migrant Education Program, which is designed to help migrant children's academic achievement.
The Migrant Education Program helps local schools offer unified education programs, incorporating early childhood education, parenting, adult literacy and basic financial education. Participating schools can customize program elements to their area's specific needs.
"We are proud to support the migrant education program because we help members achieve financial stability by bringing families together," said Nora Parker, PLCU's Oceanside branch manager.
PLCU will inform migrant families about the financial services available to them, with a focus on alternatives to the payday lenders and check-cashing services many migrants feel are their only options. In addition, the credit union will conduct free financial education seminars, in English and Spanish, for students and their parents.
PLCU also offers international money transfer services at a substantially lower cost than commercial services.
"The migrant community is a vital instrument to the county's agricultural economy, and we want to do what we can to help them improve their lives," said Parker. "It's part of our philosophy of 'people helping people.'
PLCU is a $470 million asset, San Diego-based credit union with more than 59,000 members and 15 branches.
courtesy of cuna.org
The Migrant Education Program helps local schools offer unified education programs, incorporating early childhood education, parenting, adult literacy and basic financial education. Participating schools can customize program elements to their area's specific needs.
"We are proud to support the migrant education program because we help members achieve financial stability by bringing families together," said Nora Parker, PLCU's Oceanside branch manager.
PLCU will inform migrant families about the financial services available to them, with a focus on alternatives to the payday lenders and check-cashing services many migrants feel are their only options. In addition, the credit union will conduct free financial education seminars, in English and Spanish, for students and their parents.
PLCU also offers international money transfer services at a substantially lower cost than commercial services.
"The migrant community is a vital instrument to the county's agricultural economy, and we want to do what we can to help them improve their lives," said Parker. "It's part of our philosophy of 'people helping people.'
PLCU is a $470 million asset, San Diego-based credit union with more than 59,000 members and 15 branches.
courtesy of cuna.org
Monday, July 14, 2008
Discard your electronics without compromising your ID
MADISON, Wis. (7/14/08)--When discarding computerized electronics, such as PDAs (personal digital assistants), cell phones, and computers, you may be setting yourself up as an identity theft victim by improperly erasing--or not erasing at all--your personal information from the device, says the Credit Union National Association's center for personal finance.
Deleting data via the computer's recycling bin erases only the record of the file, not the data the file points to. With the right tools, the "deleted" data still is retrievable.
Similarly, erasing data on cell phones or PDAs by resetting them--or using the "clear" option on the interface--leaves private information stored in flash memory and available for thieves, according to the website of Massachusetts Institute of Technology's Information Services and Technology (IS&T), Cambridge, Mass.
Identity theft is a steadily growing crime and can cost victims endless hours and dollars trying to salvage their credit and clear their name. However, you can protect yourself. IS&T suggests several ways to wipe out personal data when selling or recycling old equipment.
For mobile devices:
Deleting data via the computer's recycling bin erases only the record of the file, not the data the file points to. With the right tools, the "deleted" data still is retrievable.
Similarly, erasing data on cell phones or PDAs by resetting them--or using the "clear" option on the interface--leaves private information stored in flash memory and available for thieves, according to the website of Massachusetts Institute of Technology's Information Services and Technology (IS&T), Cambridge, Mass.
Identity theft is a steadily growing crime and can cost victims endless hours and dollars trying to salvage their credit and clear their name. However, you can protect yourself. IS&T suggests several ways to wipe out personal data when selling or recycling old equipment.
For mobile devices:
- Reset the device. Consult the user's manual or manufacturer's website for advice, or visit Wireless Recycling at recellular.com/recycling/data_eraser/ for other helpful information;
If your phone has a SIM card, remove it. These portable memory chips carry potentially harmful personal information; and - Follow manufacturer's guidelines for properly erasing private data from USB drives or iPods.
For computers:
- Be sure to completely erase the hard drive (so it's "wiped")--either hire someone or do it yourself; and
- For do-it-yourselfers, check out Software Options at web.mit.edu/ist/topics/security/media_sanitizing.html#4 for tools that meet government security standards, and then permanently erase all data from your hard drive.
Companies such as Green Disk safely recycle and dispose of a variety of electronic devices--cell phones, computers, PDAs, CDs, and much more.
Finally, consider physically destroying an item if you're not sure about the safety of your personal information.
courtesy of cuna.org
Survey tells CU how its members are cutting back
WINSTON-SALEM, N.C. (7/14/08)--Members of a North Carolina credit union are cutting back on driving and using online banking more as a result of high gas prices, according to a member survey.
Truliant FCU conducted a two-question survey of 850 of it members to find out how high gas prices are affecting their use of online banking and their general spending habits (Weekly Update July 11).
The first question was; "Considering high gas prices, do you feel online banking and Easy pay (Truliant's bill pay service) will allow you to cut bank on your driving?"
More than two-thirds of respondents said yes. Responses in three categories were:
You bet, every dollar counts (68.8%);
Not really, I still need to make those trips anyway (27.9%); and
Depends how high gas prices go (3.3%).
The second question was: "We are interested in hearing about changes you are making to deal with high gas prices. Check all that apply."
The majority changed their driving habits, spent less and used online banking and bill payment. Responses were:
Cut back on driving (79%);
Drive more conservatively to save gasoline (66.7%);
Spend less money on the essentials (41.9%);
Use online banking and Easy Pay more often (43.5%);
Cut back on summer vacation plans (41%);
Carpool (13%);
Walk or ride my bicycle (10.7%);
Sell my gas guzzler and buying a fuel-efficient vehicle (9.5%);
Use public transportation (5.3%); and
No changes because it's not a problem for me (4.8%).
Some of the more than 400 suggestions made by survey participants were:
Cut out all non-essentials;
No longer drive to the local park to walk for exercise; instead walk in the neighborhood and surrounding neighborhood, and reduce dining out expenses;
Bring lunch to work most days instead of driving out to eat; and
Plan better. Rather than going out and coming home several times a day, try to do as many errands as possible in one trip.
courtesy of cuna.org
Truliant FCU conducted a two-question survey of 850 of it members to find out how high gas prices are affecting their use of online banking and their general spending habits (Weekly Update July 11).
The first question was; "Considering high gas prices, do you feel online banking and Easy pay (Truliant's bill pay service) will allow you to cut bank on your driving?"
More than two-thirds of respondents said yes. Responses in three categories were:
You bet, every dollar counts (68.8%);
Not really, I still need to make those trips anyway (27.9%); and
Depends how high gas prices go (3.3%).
The second question was: "We are interested in hearing about changes you are making to deal with high gas prices. Check all that apply."
The majority changed their driving habits, spent less and used online banking and bill payment. Responses were:
Cut back on driving (79%);
Drive more conservatively to save gasoline (66.7%);
Spend less money on the essentials (41.9%);
Use online banking and Easy Pay more often (43.5%);
Cut back on summer vacation plans (41%);
Carpool (13%);
Walk or ride my bicycle (10.7%);
Sell my gas guzzler and buying a fuel-efficient vehicle (9.5%);
Use public transportation (5.3%); and
No changes because it's not a problem for me (4.8%).
Some of the more than 400 suggestions made by survey participants were:
Cut out all non-essentials;
No longer drive to the local park to walk for exercise; instead walk in the neighborhood and surrounding neighborhood, and reduce dining out expenses;
Bring lunch to work most days instead of driving out to eat; and
Plan better. Rather than going out and coming home several times a day, try to do as many errands as possible in one trip.
courtesy of cuna.org
CUs still can work with troubled Fannie, Freddie
MADISON, Wis. (7/14/08)--Credit unions still should be able to work with Fannie Mae and Freddie Mac, despite the tumble the shares of the two government-sponsored enterprises (GSEs) took last week, says Bill Hampel, chief economist of the Credit Union National Association (CUNA).
"The big declines last week have been in the value that equity investors have in Freddie Mac and Fannie Mae," explained Hampel. "The debt of the two GSEs, which they use to finance mortgage purchases, has not been losing value. If a federal bailout becomes necessary, it would likely protect the creditors of the GSEs but not the equity holders."
Hampel told News Now that "because of the importance of the GSEs to mortgage finance, it is very unlikely that the federal government would create significant changes in their current roles in the short run. This means that credit unions should still be able to deal with Freddie and Fannie as they have been.
"However," Hampel cautioned, "over the longer term, it is likely that support of the housing finance sector by the federal government and its agencies will be more expensive than it has been in the past."
The drop in the shares of Fannie Mae and Freddie Mac again Friday came amid worries that the government will need to take over the mortgage-finance firms (The New York Times July 11).
Freddie stock fell 45% to $4.42 a share, while Fannie's shares dropped 39% to $8.06 a share.
Freddie's stock lost almost 70% of its value during the week, while Fannie's stock dropped 55%.
Federal officials struggled to reassure investors. "Today our primary focus is supporting Fannie Mae and Freddie Mac in their current form as they carry out their important mission," said Treasury Secretary Henry Paulson on Friday.
"We appreciate Congress' important efforts to complete legislation that will help promote confidence in these companies. We are maintaining a dialogue with regulators and with the companies. OFHEO (Office of Federal Housing Enterprise Oversight) will continue to work with the companies as they take the steps necessary to allow them to continue to perform their important public mission," added Paulson.
Paulson's statement suggests that the administration plans to keep Fannie and Freddie as shareholder-owned firms, rather than placing them under government control, said analysts (Bloomberg News July 11). The two GSEs own or guarantee nearly half the nation's $12 trillion in home loans outstanding, including that of many credit unions.
courtesy of cuna.org
"The big declines last week have been in the value that equity investors have in Freddie Mac and Fannie Mae," explained Hampel. "The debt of the two GSEs, which they use to finance mortgage purchases, has not been losing value. If a federal bailout becomes necessary, it would likely protect the creditors of the GSEs but not the equity holders."
Hampel told News Now that "because of the importance of the GSEs to mortgage finance, it is very unlikely that the federal government would create significant changes in their current roles in the short run. This means that credit unions should still be able to deal with Freddie and Fannie as they have been.
"However," Hampel cautioned, "over the longer term, it is likely that support of the housing finance sector by the federal government and its agencies will be more expensive than it has been in the past."
The drop in the shares of Fannie Mae and Freddie Mac again Friday came amid worries that the government will need to take over the mortgage-finance firms (The New York Times July 11).
Freddie stock fell 45% to $4.42 a share, while Fannie's shares dropped 39% to $8.06 a share.
Freddie's stock lost almost 70% of its value during the week, while Fannie's stock dropped 55%.
Federal officials struggled to reassure investors. "Today our primary focus is supporting Fannie Mae and Freddie Mac in their current form as they carry out their important mission," said Treasury Secretary Henry Paulson on Friday.
"We appreciate Congress' important efforts to complete legislation that will help promote confidence in these companies. We are maintaining a dialogue with regulators and with the companies. OFHEO (Office of Federal Housing Enterprise Oversight) will continue to work with the companies as they take the steps necessary to allow them to continue to perform their important public mission," added Paulson.
Paulson's statement suggests that the administration plans to keep Fannie and Freddie as shareholder-owned firms, rather than placing them under government control, said analysts (Bloomberg News July 11). The two GSEs own or guarantee nearly half the nation's $12 trillion in home loans outstanding, including that of many credit unions.
courtesy of cuna.org
Friday, July 11, 2008
Discarding electronics may be hazardous to your ID
WASHINGTON (7/11/08)--If you carelessly dispose of your personal digital assistant (PDA), cell phone, or computer, you could be handing over personal information to the new "owners" of your discarded or recycled equipment, according to one of the guests on Sunday's H&FF Radio show.
Home & Family Finance airs Sundays at 3 p.m. EDT on the Radio America Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 90 million members, and is presented by CO-OP Network.
The Credit Union National Association (CUNA) and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.
Home & Family Finance Radio welcomes XEPE AM 1700 in San Diego, which is now airing the show each Sunday at 3 p.m. PT, beginning June 29.
Sunday's show, which you also can hear later via the Internet, features Paul Berry, Washington, D.C., journalist and broadcaster, discussing these topics with special guests:
Home & Family Finance airs Sundays at 3 p.m. EDT on the Radio America Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 90 million members, and is presented by CO-OP Network.
The Credit Union National Association (CUNA) and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.
Home & Family Finance Radio welcomes XEPE AM 1700 in San Diego, which is now airing the show each Sunday at 3 p.m. PT, beginning June 29.
Sunday's show, which you also can hear later via the Internet, features Paul Berry, Washington, D.C., journalist and broadcaster, discussing these topics with special guests:
- "Gadgets That Help You Use and Conserve Water Wisely," with Stacy Bass, utilities department public relations officer, and manager of education and outreach programs, Mesa, Ariz.;
- "Saving for College," with Jason Alderman, director, issues management, Visa USA, San Francisco, Calif.;
- "The Secrets of Money: A Guide for Everyone on Practical Financial Literacy," with Braun Mincher, entrepreneur and author, Fort Collins, Colo.;
- "Identity Theft and Safely Discarding Your Personal Electronic Equipment," with Jim Stickley, founder, chief technical officer, and vice president of engineering, TraceSecurity, San Diego, Calif.; and
- Host Paul Berry Answers Your Questions: Simple ways to save gas, ladder certificates of deposit, and select a credit counselor.
Home & Family Finance is a resource center for personal finance information at CUNA. The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; Visa; and Western Corporate FCU and its member credit unions. For more information, read "Identity Theft: Getting Back to Square One" in Home & Family Resource Center.
courtesy of cuna.org
CUs helping flood-ravaged Iowa members
ST. LOUIS, Mo. (7/11/08)--The Iowa Credit Union Foundation is still accepting applications for aid to help those affected by flooding in Iowa, according to Marybeth Foster, executive director of the foundation.
"At this point we have raised about $377,000 and would like to raise another $245,000 to meet the needs we've seen through the applications," she told News Now. "The grants are each $500. The money is transferred from the foundation to the credit union to the member."
Credit unions in Missouri are helping Iowa credit union members affected by flooding with a $4,500 donation.
Vantage CU, Bridgeton, Mo., sent an initial donation of $1,000 to the Iowa Credit Union Foundation and challenged other Missouri credit unions to contribute (CourierNet July 9).
"I know our bottom lines are tight, but an opportunity to show what we are made of doesn't present itself in this manner very often," said Hubert Hoosman, Vantage president/CEO. "Our Iowa neighbors need us."
Other credit unions donating to the effort are:
Anheuser-Busch Employees CU, St. Louis;
Century CU, St. Louis;
Mazuma CU, Kansas City;
Mid Missouri CU, Ft. Leonard Wood; and
United Consumers CU, Independence.
CommonWealth One FCU, Alexandria, Va., also donated $500 to the National Credit Union Foundation to help credit unions in Iowa.
News Now has reported that credit unions in other states have helped Iowa also.
courtesy of cuna.org
"At this point we have raised about $377,000 and would like to raise another $245,000 to meet the needs we've seen through the applications," she told News Now. "The grants are each $500. The money is transferred from the foundation to the credit union to the member."
Credit unions in Missouri are helping Iowa credit union members affected by flooding with a $4,500 donation.
Vantage CU, Bridgeton, Mo., sent an initial donation of $1,000 to the Iowa Credit Union Foundation and challenged other Missouri credit unions to contribute (CourierNet July 9).
"I know our bottom lines are tight, but an opportunity to show what we are made of doesn't present itself in this manner very often," said Hubert Hoosman, Vantage president/CEO. "Our Iowa neighbors need us."
Other credit unions donating to the effort are:
Anheuser-Busch Employees CU, St. Louis;
Century CU, St. Louis;
Mazuma CU, Kansas City;
Mid Missouri CU, Ft. Leonard Wood; and
United Consumers CU, Independence.
CommonWealth One FCU, Alexandria, Va., also donated $500 to the National Credit Union Foundation to help credit unions in Iowa.
News Now has reported that credit unions in other states have helped Iowa also.
courtesy of cuna.org
Trend for CUs is toward customized investments
PLANO, Texas (7/11/08)--Credit unions increasingly are looking for customized investment instruments with higher yields to meet their needs in today's investments market, according to Southwest Corporate.
With the economic slump, credit unions are shying away from off-the-shelf, one-size-fits-all investment opportunities.
"Certainly, structured certificates have a place in the portfolios of many credit unions," said Zane Wilson, vice president of Southwest Corporate Investment Services. "However, more and more find they need flexibility and specific terms to meet their individual needs."
More than half the structured certificate investments the corporate has created for its member credit unions in 2008 were customized certificates, specially designed investments known as "reverse inquiries."
Southwest Corporate helped credit unions place more than $415 million in investments by creating 38 structured certificates during the first half of the year. Twenty of those were customized.
The corporate noted that the growth in the customized certificates began four years ago. Investment information provided by the corporate has increased credit unions' awareness and understanding of customization, the corporate said.
When investing, "credit unions should be aware that the highest rate is not always the best alternative," Wilson said. "While rates are certainly important, other factors such as option risk and cash flow play a role in shaping strategic investing."
For example, credit unions currently can find five-year investment opportunities but short-term vehicles are more elusive, he noted.
"Southwest Corporate is tending to short-term as well as the long-term investments," Wilson said. "With a struggling economy, credit unions should not hesitate to invest in 12- to 24-month durations.
"However, with the steeper yield, if credit unions find their loan/asset ratio declining, they may have more capacity to consider longer-term certificates," he added.
Cynthia Shi, vice president of portfolio management for Southwest Corporate, noted it creates and offers certificates "based on expectations and trends of where rates are going and what is in the best interest of credit unions."
"From an investment standpoint, the first half of 2008 was tough," Wilson said. "Rates went down, then up, then down. Looking forward, (we believe) the housing slump and inflationary expectations will cast a strong shadow on an already sluggish economy.
"The Fed will likely be 'on hold' for some time in regards to overnight rates, and credit unions can expect higher term rates over the long term, given the prevailing inflation expectations," he added. "With these conditions, credit unions can venture out in that one-two year range vs. staying in overnight cash."
courtesy of cuna.org
With the economic slump, credit unions are shying away from off-the-shelf, one-size-fits-all investment opportunities.
"Certainly, structured certificates have a place in the portfolios of many credit unions," said Zane Wilson, vice president of Southwest Corporate Investment Services. "However, more and more find they need flexibility and specific terms to meet their individual needs."
More than half the structured certificate investments the corporate has created for its member credit unions in 2008 were customized certificates, specially designed investments known as "reverse inquiries."
Southwest Corporate helped credit unions place more than $415 million in investments by creating 38 structured certificates during the first half of the year. Twenty of those were customized.
The corporate noted that the growth in the customized certificates began four years ago. Investment information provided by the corporate has increased credit unions' awareness and understanding of customization, the corporate said.
When investing, "credit unions should be aware that the highest rate is not always the best alternative," Wilson said. "While rates are certainly important, other factors such as option risk and cash flow play a role in shaping strategic investing."
For example, credit unions currently can find five-year investment opportunities but short-term vehicles are more elusive, he noted.
"Southwest Corporate is tending to short-term as well as the long-term investments," Wilson said. "With a struggling economy, credit unions should not hesitate to invest in 12- to 24-month durations.
"However, with the steeper yield, if credit unions find their loan/asset ratio declining, they may have more capacity to consider longer-term certificates," he added.
Cynthia Shi, vice president of portfolio management for Southwest Corporate, noted it creates and offers certificates "based on expectations and trends of where rates are going and what is in the best interest of credit unions."
"From an investment standpoint, the first half of 2008 was tough," Wilson said. "Rates went down, then up, then down. Looking forward, (we believe) the housing slump and inflationary expectations will cast a strong shadow on an already sluggish economy.
"The Fed will likely be 'on hold' for some time in regards to overnight rates, and credit unions can expect higher term rates over the long term, given the prevailing inflation expectations," he added. "With these conditions, credit unions can venture out in that one-two year range vs. staying in overnight cash."
courtesy of cuna.org
Wednesday, July 9, 2008
Simple steps can avoid costly moving scams
NORTH PALM BEACH, Fla. (7/9/08)--Moving company scams are on the rise, with more than $1.2 million in federal fines issued by the Federal Motor Carrier Safety Association (FMCSA) in 2007. Knowing how to protect yourself before a big move could save you thousands of dollars and a lot of added stress (Bankrate.com June 27).
Common scams involve movers demanding more money before they'll deliver your possessions to your new home--after you've already paid more than the estimate they gave you.
Many variations on the moving scam theme exist, but you can take a few simple steps to help protect yourself before, during, and after a move.
Common scams involve movers demanding more money before they'll deliver your possessions to your new home--after you've already paid more than the estimate they gave you.
Many variations on the moving scam theme exist, but you can take a few simple steps to help protect yourself before, during, and after a move.
- Get recommendations. The best way to find a reputable mover is to ask friends, family, or your real estate agent.
- Do your research. Check with the Better Business Bureau to see if any complaints have been filed against the company. MovingScam.com keeps a list of more than 350 blacklisted movers. And make sure the moving company is registered with FMCSA at protectyourmove.gov.
- Get at least three on-site estimates. A telltale sign of a scam is when movers don't offer an on-site inspection. Get a written estimate signed by the mover after the estimator has seen what you want moved. Each estimate should clearly describe all charges for services the mover provides.
- Ask about the claims process. Even good movers can scratch your furniture or drop a fragile box, so it's important the mover has a clear claims process so you can recover from the damage.
- Make sure your contract covers everything. A reputable mover won't hide charges--like a driver's fee or extra fees for pads and packing--in the contract.
- Look at the moving trucks. Are they well-kept and clean? Will a company-owned truck--rather than a rental--arrive on moving day? Rented vehicles can be a red flag for rogue movers, according to FMCSA.
On the big day, make sure you're around when the movers arrive so you can answer questions and give directions. If something goes wrong, file a complaint at protectyourmove.gov or call 888-DOT-SAFT (888-368-7328) Monday through Friday between 9 a.m. and 9 p.m. EST.
For more information, listen to "No Hassles Moving Company Guide" in Home & Family Resource Center.
courtesy of cuna.org
Washington CUs kick off viral marketing campaign
FEDERAL WAY, Wash. (7/9/08)--The Washington Credit Union League has kicked off a viral marketing campaign, "Change is Beautiful," featuring webisodes with a well-known actor.
Carl Weathers, who has appeared in "Rocky," "Predator" and "Happy Gilmore," plays a philosopher who travels from spot to spot, dropping Confucius-like affirmations on unsuspecting humans (Focus Newsletter June 16).
The webisodes with Weathers are available at changeisbeautiful.net. The site allows people to sign up and receive a weekly message from Weathers, the league said.
Since April 14, commercials from the campaign have appeared on channels in Washington during programs such as "American Idol," "Ghost Whisperer," "Survivor," "Law and Order," and "Biggest Loser."
The current commercial features a 20-something woman driving with three others through a four-way intersection.
The Cooperative Advertising Committee and Big Bang advertising agency developed "Change is Beautiful". The effort is supplemented by discovercreditunions.com.
This year's campaign is similar to last year's, but the viral portion is new. Bill Grant, Big Bang representative, said the viral content has more entertainment value.
"The single most important insight about this campaign is that young bank customers are an apathetic lot," Grant. "Engaging them creatively will help result in them rewarding us with a little more active thought about an alternative banking experience."
The Credit Unions of Washington Cooperative Advertising Committee funded the campaign through commitments from credit unions.
"The more support this effort gets, the better off all of the credit unions in Washington will be," said Kristina Walters, committee treasurer and vice president of marketing and business development for Washington State Employees CU, Olympia.
courtesy of cuna.org
Carl Weathers, who has appeared in "Rocky," "Predator" and "Happy Gilmore," plays a philosopher who travels from spot to spot, dropping Confucius-like affirmations on unsuspecting humans (Focus Newsletter June 16).
The webisodes with Weathers are available at changeisbeautiful.net. The site allows people to sign up and receive a weekly message from Weathers, the league said.
Since April 14, commercials from the campaign have appeared on channels in Washington during programs such as "American Idol," "Ghost Whisperer," "Survivor," "Law and Order," and "Biggest Loser."
The current commercial features a 20-something woman driving with three others through a four-way intersection.
The Cooperative Advertising Committee and Big Bang advertising agency developed "Change is Beautiful". The effort is supplemented by discovercreditunions.com.
This year's campaign is similar to last year's, but the viral portion is new. Bill Grant, Big Bang representative, said the viral content has more entertainment value.
"The single most important insight about this campaign is that young bank customers are an apathetic lot," Grant. "Engaging them creatively will help result in them rewarding us with a little more active thought about an alternative banking experience."
The Credit Unions of Washington Cooperative Advertising Committee funded the campaign through commitments from credit unions.
"The more support this effort gets, the better off all of the credit unions in Washington will be," said Kristina Walters, committee treasurer and vice president of marketing and business development for Washington State Employees CU, Olympia.
courtesy of cuna.org
Tuesday, July 8, 2008
Filene report offers new concept in debt relief
MADISON, Wis. (7/8/08)--Credit unions seeking information about debt relief for their members can reference a new report from the Filene Research Institute on Responsible Debt Relief (RDR).
Robert D. Manning, director, center for consumer financial services at the Rochester Institute of Technology, has released "Responsible Debt Relief: An Algorithmic Assessment of Household Debt Capacity and Repayment Capability."
The key to a successful RDR system is the objective and statistically precise estimate of consumer debt capacity and debt repayment capability, according to Manning.
His Responsible Choice program, based on an algorithm that estimates household debt capacity and repayment capability, classifies individual consumers into tested debt management programs.
"The RDR algorithm improves the efficiency of the overall system of consumer debt management programs by guiding consumers to the plans that best match their financial situation," said George Hofheimer, Filene chief research officer.
RDR applies to households that do not qualify for an accredited Consumer Credit Counseling Service. Many of those households often enroll in nefarious debt settlement programs or file for consumer bankruptcy, Filene said.
Household debt has grown to more than $13 trillion in 2008, from less than $4 trillion in 1990. Current home mortgage debt is $10.5 trillion, compared with $2.5 trillion during the same time period. Credit card debt also has quadrupled to $950 billion.
courtesy of cuna.org
Robert D. Manning, director, center for consumer financial services at the Rochester Institute of Technology, has released "Responsible Debt Relief: An Algorithmic Assessment of Household Debt Capacity and Repayment Capability."
The key to a successful RDR system is the objective and statistically precise estimate of consumer debt capacity and debt repayment capability, according to Manning.
His Responsible Choice program, based on an algorithm that estimates household debt capacity and repayment capability, classifies individual consumers into tested debt management programs.
"The RDR algorithm improves the efficiency of the overall system of consumer debt management programs by guiding consumers to the plans that best match their financial situation," said George Hofheimer, Filene chief research officer.
RDR applies to households that do not qualify for an accredited Consumer Credit Counseling Service. Many of those households often enroll in nefarious debt settlement programs or file for consumer bankruptcy, Filene said.
Household debt has grown to more than $13 trillion in 2008, from less than $4 trillion in 1990. Current home mortgage debt is $10.5 trillion, compared with $2.5 trillion during the same time period. Credit card debt also has quadrupled to $950 billion.
courtesy of cuna.org
New online courses benefit small biz owners
WASHINGTON (7/7/08)—To aid small business owners with the basics of finance and borrowing, the U.S. Small Business Administration (SBA) launched two new online resources last month on loan guaranty programs and loan package preparation (U.S. Small Business Administration June 26).
Independent businesses with fewer than 500 workers have created 60% to 80% of new jobs annually over the past decade and represent 99.7% of all employer firms, according to the Small Business Administration (SBA). The significance of small business on the economy is evident in these statistics, and the SBA and similar outlets provide resources to assist them with their endeavors.
The two new self-paced tutorials, Finance Primer: Guide to SBA's Loan Guaranty Programs and How to Prepare a Loan Package, appear on the administration's Web site and are available free to anyone registering at sba.gov/services/training/newcourses/index.html.
The finance primer course identifies the most frequently used sources of capital by small businesses, reviews basic finance philosophy, and illustrates SBA's loan guaranty programs.
The loan package course covers how to prepare a loan package for a lender, how a lender will assess a loan request, and how entrepreneurs can avoid common financial mistakes such as securing the wrong type of financing or underestimating the cost of borrowing money.
Both tutorials provide information about supplemental resources for small business owners and help entrepreneurs develop economic independence and become more financially savvy.
Course participants completing the 30-minute online training receive completion certificates from the SBA. Go to sba.gov for additional resources for small businesses.
For more information, read, "Small Business: Analyze the Numbers," in Plan It: Retire Ready Toolkit.
courtesy of cuna.org
Independent businesses with fewer than 500 workers have created 60% to 80% of new jobs annually over the past decade and represent 99.7% of all employer firms, according to the Small Business Administration (SBA). The significance of small business on the economy is evident in these statistics, and the SBA and similar outlets provide resources to assist them with their endeavors.
The two new self-paced tutorials, Finance Primer: Guide to SBA's Loan Guaranty Programs and How to Prepare a Loan Package, appear on the administration's Web site and are available free to anyone registering at sba.gov/services/training/newcourses/index.html.
The finance primer course identifies the most frequently used sources of capital by small businesses, reviews basic finance philosophy, and illustrates SBA's loan guaranty programs.
The loan package course covers how to prepare a loan package for a lender, how a lender will assess a loan request, and how entrepreneurs can avoid common financial mistakes such as securing the wrong type of financing or underestimating the cost of borrowing money.
Both tutorials provide information about supplemental resources for small business owners and help entrepreneurs develop economic independence and become more financially savvy.
Course participants completing the 30-minute online training receive completion certificates from the SBA. Go to sba.gov for additional resources for small businesses.
For more information, read, "Small Business: Analyze the Numbers," in Plan It: Retire Ready Toolkit.
courtesy of cuna.org
Davidson: CUs need to combat aggressive thieves
NEW YORK (7/7/08)--Credit unions need to keep up with aggressive thieves who are recycling types of fraud and expanding them into different payment areas.
So says Ann Davidson, risk manager at CUNA Mutual Group, speaking Wednesday at the America's Credit Union Conference & Expo last week. The event, presented by the Credit Union National Association, closed on Wednesday.
"When the economy is not so good, the temptation is there," Davidson said.
The newest targets for fraud are electronic paychecks, via automated clearing house (ACH), and mobile payments via the .mobi Internet extension, she said. Today members can make payments through cash, check, credit and debit card, and online billing, via ACH, and through cell phones and personal digital assistants.
"How do you manage the member's fraud risk when that member uses six payment systems? Credit unions want to become the member's primary financial institution (PFI), so you can manage fraud from a cross-channel protection point of view," Davidson said.
"Thieves are having educational sessions, identifying who has the weakest link. They come in and will keep coming in until you plug the hole," she told credit unions.
She noted the dangers of "silo fraud monitoring," with each type of transaction monitored separately. "All those types of transactions get posted to the member's account. You are seeing those transactions somewhere along the line."
Technology makes fraud easier, but it can help to manage fraud also. On March 20, 2009, credit unions will be required to have their systems ACH-compliant.
Some best practices to help minimize the effects of fraud include:
Use the fraud management system to identify and block suspect transactions;
Deactivate the mobile device in the event of theft or loss, like credit unions do with card fraud;
Use encryption of locally stored data; and
Implement personal identification number authorization and lockout.
Use the same methods in new risk areas, such as mobile devices:
Make them compliant with the Federal Financial Institutions Examination Council;
Secure registration of mobile devices;
Require Secure Socket Layer connection;
Validate and confirm security layers are working effectively; and
Talk to your peers.
Also note that member business lending (MBL) presents "a huge risk, associated with ACH. It's not wrong, but you need to manage it," Davidson said.
How does a credit union get connected to manage all these types of fraud? Through enterprise cross-channel management, she said.
Centralize your fraud risk management, layer loss control solutions across all transactions; do this in real-time; and centralize compliance and regulatory requirements, Davidson advised.
courtesy of cuna.org
So says Ann Davidson, risk manager at CUNA Mutual Group, speaking Wednesday at the America's Credit Union Conference & Expo last week. The event, presented by the Credit Union National Association, closed on Wednesday.
"When the economy is not so good, the temptation is there," Davidson said.
The newest targets for fraud are electronic paychecks, via automated clearing house (ACH), and mobile payments via the .mobi Internet extension, she said. Today members can make payments through cash, check, credit and debit card, and online billing, via ACH, and through cell phones and personal digital assistants.
"How do you manage the member's fraud risk when that member uses six payment systems? Credit unions want to become the member's primary financial institution (PFI), so you can manage fraud from a cross-channel protection point of view," Davidson said.
"Thieves are having educational sessions, identifying who has the weakest link. They come in and will keep coming in until you plug the hole," she told credit unions.
She noted the dangers of "silo fraud monitoring," with each type of transaction monitored separately. "All those types of transactions get posted to the member's account. You are seeing those transactions somewhere along the line."
Technology makes fraud easier, but it can help to manage fraud also. On March 20, 2009, credit unions will be required to have their systems ACH-compliant.
Some best practices to help minimize the effects of fraud include:
Use the fraud management system to identify and block suspect transactions;
Deactivate the mobile device in the event of theft or loss, like credit unions do with card fraud;
Use encryption of locally stored data; and
Implement personal identification number authorization and lockout.
Use the same methods in new risk areas, such as mobile devices:
Make them compliant with the Federal Financial Institutions Examination Council;
Secure registration of mobile devices;
Require Secure Socket Layer connection;
Validate and confirm security layers are working effectively; and
Talk to your peers.
Also note that member business lending (MBL) presents "a huge risk, associated with ACH. It's not wrong, but you need to manage it," Davidson said.
How does a credit union get connected to manage all these types of fraud? Through enterprise cross-channel management, she said.
Centralize your fraud risk management, layer loss control solutions across all transactions; do this in real-time; and centralize compliance and regulatory requirements, Davidson advised.
courtesy of cuna.org
Thursday, July 3, 2008
Heath: CUs are an idea that hasn't stuck
NEW YORK CITY (7/3/08)--Credit unions are a good idea that hasn't stuck, according to Dan Heath, idea collector, who keynoted the closing general session on "Ideas That Stick" during the America's Credit Union Conference & Expo.
The conference, presented by the Credit Union National Association in New York City, ended Wednesday.
Heath said he is "a huge credit union fan. I've been a member of Amplify CU in Austin, Texas, for 20 years. I've carried two mortgages, two car loans, and a savings account and share certificate there."
He told credit unions: "I support what you do, and in my judgment, you have an extreme, grotesque advantage over banks. But you're an idea that hasn't stuck."
Ideas that stick are understood, are remembered and change something, he said. They are:
Simple;
Unexpected;
Concrete;
Credible;
Emotional; and
Told in stories.
Ideas are not created equal, he said. Small talk doesn't stick. To make credit unions' ideas stick, there are ways to get people to believe: 1. Live it; 2. Hear the story; and 3. Hear the description--which is the least effective method.
courtesy of cuna.org
The conference, presented by the Credit Union National Association in New York City, ended Wednesday.
Heath said he is "a huge credit union fan. I've been a member of Amplify CU in Austin, Texas, for 20 years. I've carried two mortgages, two car loans, and a savings account and share certificate there."
He told credit unions: "I support what you do, and in my judgment, you have an extreme, grotesque advantage over banks. But you're an idea that hasn't stuck."
Ideas that stick are understood, are remembered and change something, he said. They are:
Simple;
Unexpected;
Concrete;
Credible;
Emotional; and
Told in stories.
Ideas are not created equal, he said. Small talk doesn't stick. To make credit unions' ideas stick, there are ways to get people to believe: 1. Live it; 2. Hear the story; and 3. Hear the description--which is the least effective method.
courtesy of cuna.org
How many members know why CUs help?
NEW YORK (7/3/08)--In New York City, "the epicenter of the events that led to the crisis that put us where we are financially today," Credit Union National Association Chairman (CUNA) Tom Dorety told credit unions attending the America's Credit Union Conference & Expo to use the economy to help point out the good that credit unions do.
"We need more member involvement in appreciating credit unions cooperative structure and services to strengthen ties to garner support for their cooperative structure and gaining recognition and support with local leaders, and we need to improve our connectivity with young people," Dorety said.
Dorety, CEO of Suncoast Schools FCU in Tampa, Fla., spoke during the closing general session Wednesday.
Banks are "putting people out of jobs and cutting services, but they're making their investors happy," he said. "Credit unions overwhelming do the opposite--we're making loans, helping with mortgages," and they can use a strong network to make intelligent decisions that are in the best long-term interest" for members, he added.
Many stories highlighting credit unions' good work have appeared in national, state and local media. "But how many people know why we help?" Dorety asked.
He noted that strategy follows structure. "Our actions are the direct result of who our audience is. Of course we're helping members. Why wouldn't we?"
But it's getting harder, with the overall competition credit unions face. Being better than a bank sets "a weak standard," and "acceptance of the previous standard often means we have none of our own," he said.
Roughly 5%--the estimates run from 1% to 10%--of members "really get [what credit unions are about]. But what if that doubled? What if four million who understand who we are became eight million people who understand who we are?" he asked.
Instead of debating terms such as "membership," "joining" and "belonging," credit unions ought to be discussing at the state, national and local level strategic plans on how to better leverage their actions.
"Use the economy to our advantage. Small businesses are begging for more affordable credit. How can anyone be opposed to increasing the member business lending cap and providing better tools to measure safety and soundness in our current economic environment?" Dorety asked.
He also noted that the Credit Union, Bank and Thrift Regulatory Relief Act (CUBTRRA, H.R. 6312), "was the result of remarkable effort by many people, state leagues and particularly staff at CUNA."
"All of us agree we need more enhancements on credit union charters, we need to convince Congress to act on the member business lending cap, and the prompt corrective action risk-based cap," he added.hat credit unions do.
courtesy of cuna.org
"We need more member involvement in appreciating credit unions cooperative structure and services to strengthen ties to garner support for their cooperative structure and gaining recognition and support with local leaders, and we need to improve our connectivity with young people," Dorety said.
Dorety, CEO of Suncoast Schools FCU in Tampa, Fla., spoke during the closing general session Wednesday.
Banks are "putting people out of jobs and cutting services, but they're making their investors happy," he said. "Credit unions overwhelming do the opposite--we're making loans, helping with mortgages," and they can use a strong network to make intelligent decisions that are in the best long-term interest" for members, he added.
Many stories highlighting credit unions' good work have appeared in national, state and local media. "But how many people know why we help?" Dorety asked.
He noted that strategy follows structure. "Our actions are the direct result of who our audience is. Of course we're helping members. Why wouldn't we?"
But it's getting harder, with the overall competition credit unions face. Being better than a bank sets "a weak standard," and "acceptance of the previous standard often means we have none of our own," he said.
Roughly 5%--the estimates run from 1% to 10%--of members "really get [what credit unions are about]. But what if that doubled? What if four million who understand who we are became eight million people who understand who we are?" he asked.
Instead of debating terms such as "membership," "joining" and "belonging," credit unions ought to be discussing at the state, national and local level strategic plans on how to better leverage their actions.
"Use the economy to our advantage. Small businesses are begging for more affordable credit. How can anyone be opposed to increasing the member business lending cap and providing better tools to measure safety and soundness in our current economic environment?" Dorety asked.
He also noted that the Credit Union, Bank and Thrift Regulatory Relief Act (CUBTRRA, H.R. 6312), "was the result of remarkable effort by many people, state leagues and particularly staff at CUNA."
"All of us agree we need more enhancements on credit union charters, we need to convince Congress to act on the member business lending cap, and the prompt corrective action risk-based cap," he added.hat credit unions do.
courtesy of cuna.org
Wednesday, July 2, 2008
It pays to negotiate
YONKERS, N.Y. (7/2/08)--It's not uncommon to drive a few extra blocks to save a few cents on gas, but most American consumers still aren't going the extra mile to save hundreds of dollars by negotiating on big purchases (ShopSmartMag.org June/July 2008).
Negotiating is a little more work, but it can be well worth the extra effort. A Consumer Reports National Research Center survey showed the majority of consumers who negotiated prices on appliances, electronics, or furniture got at least one discount in the past three years. Yet 40% of survey respondents admitted they rarely even attempt to negotiate (ConsumerReports.org).
How do negotiating shoppers land a bargain? They come to the store prepared, they aren't afraid to ask questions, and they know that the first price they see doesn't always have to be the final price.
Try these negotiating tips, even if you're an inexperienced bargainer:
Negotiating is a little more work, but it can be well worth the extra effort. A Consumer Reports National Research Center survey showed the majority of consumers who negotiated prices on appliances, electronics, or furniture got at least one discount in the past three years. Yet 40% of survey respondents admitted they rarely even attempt to negotiate (ConsumerReports.org).
How do negotiating shoppers land a bargain? They come to the store prepared, they aren't afraid to ask questions, and they know that the first price they see doesn't always have to be the final price.
Try these negotiating tips, even if you're an inexperienced bargainer:
- Do your research. The Internet makes it easy to find the going price for just about anything--a new dinner table, a laptop, or the latest digital camera. Check out shopzilla.com or pricegrabber.com before you head to the store. If you find a competitor's price in a newspaper ad, bring a copy of the ad with you to the store.
- Always ask. If you're remodeling your kitchen, ask about a volume discount if you buy more than two appliances. Before you hand over your money, ask if there's an impending sale.
- Try for a break on extras. If the salesperson insists the price can't be lowered, ask for a deal on extras like delivery, installation, or a warranty.
- Bring cash. If you can offer payment on the spot, the salesperson will be more likely to cut you a deal.
- Take your time. Unless you need that refrigerator today, it's probably best to return to the store more than once. You don't have to be in a hurry to make a big purchase; a good salesperson will understand that and will want to be there when you're ready to close the deal.
For more information, use, "Calculator: What It's Worth to Cut Back My Spending," in Home & Family Resource Center.
courtesy of cuna.org
Firefighter's story: From darkness to light
NEW YORK (7/1/08)--"We will never forget. We will never give up."
With those words, Richard Picciotto, retired fire chief of the New York Fire Department, summed up his harrowing survival of the terrorist attacks of Sept. 11, 2001, at America's Credit Union Conference & Exp, which began Monday in New York City.
Picciotto has strong credit union ties. He has been a member of Municipal CU for 30 years, he announced and his cousin is employed by a credit union in Miami, Fla.
Picciotto was on a rescue mission in the World Trade Center's North Tower when it collapsed. The South Tower disintegrated in 10 seconds; the North Tower, in eight seconds. "That sounds like a short time," he said, "but it's an eternity.
"We were tossed around like rag dolls, free-falling in the blackness," he continued. "I knew I was going to die. My life flashed before me, and I said a quick prayer: 'Please God, make it quick.'"
Picciotto and 13 other survivors—11 firefighters, one Port Authority officer, and one civilian—landed on the third floor in a void, or air pocket, buried in talcum-powder-like dust. After hours of spotty radio communication with rescuers, he glimpsed a light gray patch amid the blackness. It was a crevice in the rubble, from which Picciotto emerged--a solitary figure atop the once-proud tower's remains.
Picciotto credits tremendous support—both emotional and financial—for helping him get through the experience. He urged conference attendees to establish priorities in their lives--family and friends. "Stop to smell the roses, and appreciate what you have."
Other observations:
With those words, Richard Picciotto, retired fire chief of the New York Fire Department, summed up his harrowing survival of the terrorist attacks of Sept. 11, 2001, at America's Credit Union Conference & Exp, which began Monday in New York City.
Picciotto has strong credit union ties. He has been a member of Municipal CU for 30 years, he announced and his cousin is employed by a credit union in Miami, Fla.
Picciotto was on a rescue mission in the World Trade Center's North Tower when it collapsed. The South Tower disintegrated in 10 seconds; the North Tower, in eight seconds. "That sounds like a short time," he said, "but it's an eternity.
"We were tossed around like rag dolls, free-falling in the blackness," he continued. "I knew I was going to die. My life flashed before me, and I said a quick prayer: 'Please God, make it quick.'"
Picciotto and 13 other survivors—11 firefighters, one Port Authority officer, and one civilian—landed on the third floor in a void, or air pocket, buried in talcum-powder-like dust. After hours of spotty radio communication with rescuers, he glimpsed a light gray patch amid the blackness. It was a crevice in the rubble, from which Picciotto emerged--a solitary figure atop the once-proud tower's remains.
Picciotto credits tremendous support—both emotional and financial—for helping him get through the experience. He urged conference attendees to establish priorities in their lives--family and friends. "Stop to smell the roses, and appreciate what you have."
Other observations:
- Following Sept. 11, "the feeling of unity was great." That's disappeared, he claims, and he blames politicians for that. "Politicians tend to divide us, to target our minor differences" versus our commonalities.
- Youth—often tagged the "me generation"--were affected deeply by Sept. 11. Many enlisted in the armed forces as a result. "Whatever your [political] beliefs, the troops are there to fight for us no matter what, and we need to support them."
Above all, Picciotto is grateful God didn't listen to his request for a quick ending. "Sometimes," he observed, "unanswered prayers are the best kind."
America's Credit Union Conference & Expo, which is presented by the Credit Union National Association, ends Wednesday.
courtesy of cuna.org
Mortgages lead loan growth for CUs in May
MADISON, Wis. (7/1/08)--Credit union loans outstanding increased 1% in May, and 2.8% so far this year, with fixed-rate first mortgages leading loan growth, rising 2.6%, according to the Credit Union National Association (CUNA) monthly sample of credit unions.
The 2.8% rise in loans outstanding year-to-date 2008, compares with a 1.6% rise for the comparable five-month period last year.
"Credit union real estate lending is the main factor driving the surge in loan balances," Steve Rick, CUNA senior economist, told News Now. "The exodus of lenders and the tightening of lending standards by other real estate lenders is providing credit unions an excellent opportunity to increase market share."
Credit union fixed-rate first mortgage loan balances rose 10.4% in the first five months of 2008, compared with 6% for the 2007 similar period, he added.
"With the mortgage securitization market still froze up, portfolio lenders such as credit unions are increasing their market share in the real estate space," Rick said. "We can expect this scenario to continue to play out as long as home prices continue to fall across the U.S."
Following the rise in fixed-rate mortgages were home equity (1.8%), credit card (1.2%), and used auto loans (1%). Unsecured personal loans, adjustable rate mortgages, and new auto loans declined 0.7%, 0.5% and 0.3%, respectively.
May is the fifth consecutive month in which used-auto loans as a percentage of total loans increased. During the same period, new-auto loans as a percentage of loans have decreased.
Click for larger viewCredit union savings balances increased 1.9% in May, and 6.7% year-to-date. With payday falling on the last Friday of the month, share drafts led savings growth, increasing 7.9% in May. "For the year, we expect credit union savings balances to grow over 10% because of the tax rebates, slowing economy, falling home prices, and further deleveraging of household balance sheets," Rick said.
Money market accounts (2.9%), regular shares (2.5%), and individual retirement accounts increased, while one-year certificates declined 0.47%.
With savings growth outpacing loan growth, the loan-to-savings ratio decreased to 80.4% in May from 81.1% in April. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--increased to 19.5% in May from 18.9% in April.
Regarding asset quality, credit union 60-plus-day delinquencies remained at 1% in May, a 0.3% increase from May 2007.
The movement's overall capital-to-asset ratio remains at 11.1%. The total dollar amount of capital is $90 billion.
The fast deposit growth increased credit union balance sheets and lowered the credit union average capital-to-asset ratio to 10.9% from its recent high of 11.5% last October.
"This drop is to be expected during an economic slowdown," Rick explained. "Capital is meant to be an economic stabilizer, rising during an economic boom and reduced during an economic slowdown, protecting credit union members from the vicissitudes of the economy."
courtesy of cuna.org
The 2.8% rise in loans outstanding year-to-date 2008, compares with a 1.6% rise for the comparable five-month period last year.
"Credit union real estate lending is the main factor driving the surge in loan balances," Steve Rick, CUNA senior economist, told News Now. "The exodus of lenders and the tightening of lending standards by other real estate lenders is providing credit unions an excellent opportunity to increase market share."
Credit union fixed-rate first mortgage loan balances rose 10.4% in the first five months of 2008, compared with 6% for the 2007 similar period, he added.
"With the mortgage securitization market still froze up, portfolio lenders such as credit unions are increasing their market share in the real estate space," Rick said. "We can expect this scenario to continue to play out as long as home prices continue to fall across the U.S."
Following the rise in fixed-rate mortgages were home equity (1.8%), credit card (1.2%), and used auto loans (1%). Unsecured personal loans, adjustable rate mortgages, and new auto loans declined 0.7%, 0.5% and 0.3%, respectively.
May is the fifth consecutive month in which used-auto loans as a percentage of total loans increased. During the same period, new-auto loans as a percentage of loans have decreased.
Click for larger viewCredit union savings balances increased 1.9% in May, and 6.7% year-to-date. With payday falling on the last Friday of the month, share drafts led savings growth, increasing 7.9% in May. "For the year, we expect credit union savings balances to grow over 10% because of the tax rebates, slowing economy, falling home prices, and further deleveraging of household balance sheets," Rick said.
Money market accounts (2.9%), regular shares (2.5%), and individual retirement accounts increased, while one-year certificates declined 0.47%.
With savings growth outpacing loan growth, the loan-to-savings ratio decreased to 80.4% in May from 81.1% in April. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--increased to 19.5% in May from 18.9% in April.
Regarding asset quality, credit union 60-plus-day delinquencies remained at 1% in May, a 0.3% increase from May 2007.
The movement's overall capital-to-asset ratio remains at 11.1%. The total dollar amount of capital is $90 billion.
The fast deposit growth increased credit union balance sheets and lowered the credit union average capital-to-asset ratio to 10.9% from its recent high of 11.5% last October.
"This drop is to be expected during an economic slowdown," Rick explained. "Capital is meant to be an economic stabilizer, rising during an economic boom and reduced during an economic slowdown, protecting credit union members from the vicissitudes of the economy."
courtesy of cuna.org
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