Credit Unions Well Ahead of Banks in Consumer Trust

Posted by SIU Credit Union on Jan 28th, 2010 | View Comments

WASHINGTON (1/28/10)–Credit unions have a higher approval rating on trust than banks, according to the latest Chicago Booth/Kellogg School Financial Trust Index (The Wall Street Journal Jan. 28).

Credit unions had a 58% approval rating, compared with a 31% approval rating of national banks and 53% of local banks. Banks in which the government has a stake were trusted the least, with a 21% approval rating, the report said.

The study was based on phone surveys to consumers in the U.S. Data was collected in late December by the University of Chicago and Northwestern University in Evanston, Ill.

“The Trust Index reveals that what has made credit unions successful–service to members, transparency in operation, a real feeling of ‘ownership’ in the institution–are values that are honored by the American public,” said Credit Union National Association President/CEO Dan Mica. “The fact is, credit unions did not start the fire leading to the financial meltdown–but they can play a significant role in helping Americans recover from it.”

Paola Sapienza, one of the study’s authors, noted that trust in credit unions and community banks is much higher than in national banks, “consistent with academic evidence that local [institutions] have more transparency, fewer hidden fees and better customer service compared to national banks.”

Certified Financial Planner™ Now Available at SIU Credit Union

Posted by Chris Sievers on Jan 19th, 2010 | View Comments

Jeff Rose, Certified Financial Planner™ for SIU Credit Union

SIU Credit Union members now have access to a Certified Financial Planner™ to help them navigate their financial future with the creation of SIU CU Investment Services department.

Jeff Rose, a Certified Financial Planner™ with Alliance Planning Investment Group in Carbondale, will offer financial planning and investment services to credit union members. He will hold office hours on Tuesday from 9 a.m. to 1 p.m. or by appointment at the SIU Credit Union Giant City Road location.

“We are thrilled to be working with someone of Jeff’s caliber,” said Dennis Schaefer, President and CEO of SIU Credit Union. “By adding this service, our members will have access to one of only a handful of Certified Financial Planners™ in Southern Illinois. We are continuously looking for ways to improve the financial lives of our members and we believe adding a financial planner achieves that.

Rose can help members create a financial road map to retirement.

 “I’m very excited about the opportunity,” Rose said. “Now more than ever, people need to be prepared for their financial future.”

 Rose will assist members with investment choices, stocks and bond purchases and help with retirement planning. Rose can also help with asset management, college savings plans, life insurance and small business retirement plans.

 To schedule an appointment with Rose, call 618-549-8632 or e-mail him at jeff.rose@siucu.org For more information on Jeff Rose, visit http://www.allianceinvestmentplanning.com/meet-our-team/jeff-rose.html, http://www.goodfinancialcents.com/.

 SIU Credit Union is a not-for-profit financial institution. With over 25,000 members and thousands of free ATM locations worldwide, SIU Credit Union is the largest credit union in Southern Illinois. Membership is open to anyone living or working in 11 Southern Illinois counties. For more information, or to find a location, visit www.siucu.org.

 Securities and life insurance offered through LPL Financial, Member FINRA/SIPC The LPL Financial registered representative associated with this site only discuss and/or transact securities business with residents of the following states: AZ,CA,CO,IL,IN,FL,KY,MO,NJ,NM,NV,PA,WA,WI,WV,VA.

CU members can help victims of Haiti earthquake.

Posted by Chris Sievers on Jan 15th, 2010 | View Comments

The Credit Union National Association (CUNA) and others in the credit union movement have begun rallying around the relief efforts to help Haiti’s 175 credit unions, their employees and volunteers, and their members impacted by Tuesday’s deadly earthquake.

As of Thursday afternoon, about 24 hours after the Worldwide Foundation for Credit Unions and the National Credit Union Foundation (NCUF) activated their sites for collecting donations, more than $83,570 combined had been contributed from the credit union movement.

Haiti’s 175 credit unions serve more than 400,000 members, according to WOCCU.

According to the International Red Cross, up to three million people have been affected, and the death toll is feared to be in the thousands. Many victims are sleeping in the streets.

All donations made via CUAid.coop will be forwarded to credit union organizations in affected areas through NCUF, which is a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code.

For more information or to donate, visit  CUAid.coop and click on “Donate Now.”

What You Need to Know Before Deciding Whether or Not to Opt In

Posted by SIU Credit Union on Jan 12th, 2010 | View Comments

You’ve probably heard in the news recently about the new overdraft protection opt-in requirement for account holders at banks and credit unions.  Undoubtedly, you have been urged by some commentator on the national news network of your choice about the importance of not opting in.  Before you jump on this bandwagon, read this article.

First, here’s a brief summary of how overdraft protection works…  Let’s say John Smith has $100 in his account.  If a $150 item – whether it is a check, ACH debit (electronic payment), ATM withdrawal, or debit card purchase – tries to clear John’s account, there isn’t enough money, therefore the transaction is denied.  If John was enrolled in a program where he had overdraft protection, the $150 item would be paid, and John would be charged a fee for this service (the fee would most likely be much higher from a bank than a credit union…cheap shot, I know…just kidding, banker friends).

Ok, so now that you know the basics, let’s compare overdraft protection as it exists now with overdraft protection as it will exist during the second half of 2010.

NOW:

Currently, financial institutions can offer this service to their members as a privilege, without making them sign anything in addition to the normal paperwork required at account opening.  Many of you who are reading this, whether you know it or not, have overdraft protection of some sort with your bank or credit union.  At SIU Credit Union, if your account has been opened for 30 days or more, and you are a member in good standing, you have Privilege Pay.  If you try to make a purchase with your debit card, and you don’t have enough available funds in your account, we will allow the transaction to go through and will subsequently charge a $27 fee for the service.

JULY 2010:

Recent amendments to Regulation E, the regulation which carries out the requirements of the Electronic Funds Transfer Act, will significantly change existing overdraft protection programs.  The amendments apply only to ATM withdrawals and one-time debit transactions and will prevent a bank or credit union from charging a fee when the protection is used unless the consumer affirmatively agrees to enroll in the program.  So, unless consumers opt in, they will not be able to make ATM withdrawals or debit purchases if there are insufficient funds in the account.

Many consumer groups are urging the public not to opt in.  At first glance, this looks like the best option…consumers can avoid fees and shouldn’t spend more than what they have.  However, this narrow view fails to look at the whole picture.  So, before you curse the existence of overdraft protection, consider the following.  What happens when our John Smith from above is in line at the grocery store, buying groceries to feed his family, and his transaction is denied?  Not only is John embarrassed because his next door neighbor is two spots behind him in line, but he has no way to provide food for his family.  Or maybe John has paid all of his bills for the month, has plenty of food in the house, has $1.50 left in his account before payday, and his child gets sick.  John goes to the drug store to pick up the prescription, swipes his debit card, and it is denied.  These are real-life situations that could have been prevented if John had overdraft protection.  Many opponents would respond with the fact that John could write a check in either scenario, since checks aren’t affected by the new amendments.  John could in deed write a check, and assuming his bank or credit union offered him overdraft protection, the check would be paid and John would pay the appropriate fee.  However, John would also pay a returned check fee to the grocery store or drug store. I’m sure if John were given the options of (1) using his debit card and paying a $27 overdraft protection fee to buy the medicine or (2) paying a $27 overdraft protection fee plus a returned check fee to the drug store to buy the medicine, John would choose option (1).  But in a few short months, John won’t have this option unless he chooses to opt in to overdraft protection.

I am in no way suggesting that individuals should opt in so they can carelessly use their debit cards without knowing how much money is actually in their account. Nor am I saying that you should opt in just in case you want that designer purse prior to payday.  Spend wisely.  But also prepare for the unexpected.  Have the service available for yourself for those times when you may have no other option.

– Amy Ragan, JD
Compliance Officer / Internal Auditor
SIU Credit Union

In Protest of Big Banks, The “Move Your Money” Campaign Picks Up Steam

Posted by Joshua English on Jan 8th, 2010 | View Comments

“Move Your Money” is a budding movement that has the capacity to cause a major power shift in the financial industry.  It’s main purpose is to convince people to take their money out of the “too big to fail” banks and move it into the more community-oriented banks and credit unions.

A financial institution’s foundation relies on the core deposits (checking & savings accounts) of businesses and everyday people.  What they want, in essence, is a run on big banks.  A bank run occurs when a large number of people withdraw their deposits.  When this happens the likelihood of default increases, which then encourages even more withdrawals.  This can put a bank in dire circumstances and in extreme cases, bankruptcy.

Because this movement has just begun (late December 2009), it’s to early to tell whether or not people are actually going to move their money.  After all, changing banks can be tedious (which is why SIU Credit Union has a Switch Kit).  But even with this, “Move Your Money” success stories are already being documented.

There is also a tool on the Move Your Money website that lets people search for credit unions and small community banks in their area.  About a week ago, Arianna Huffington went on CNN to promote the “Move Your Money” campaign and in the following 48 hours, 80,000 people used the feature to find a local bank.  Since then this search tool has gotten around 45,000 page views a day.  There is also an edgy YouTube video that in one week, has amassed over 300,000 views:

MoveYourMoney.info uses an IRA database to help people find banks in their area.  Credit Unions don’t disclose financial information in the same ways banks do, therefore SIU Credit Union won’t be found using this search feature.  If you are interested in moving your money, visit us at www.siucu.org for more information, or just stop by one of our four branches and apply to become a member.

IRA Accounts: A Great Retirement Option

Posted by SIU Credit Union on Jan 6th, 2010 | View Comments

 Are you thinking about retirement?  It is never too early to begin planning for your retirement.  Recent statistics show that most individuals will need to rely on their personal savings for up to 60% of their retirement income (www.ssa.gov).  This can be an overwhelming statistic when you begin to think about it.   

An IRA account is a great way to save for those retirement years.  You may make contributions to an IRA in addition to the contributions that you make to a 401K program at your place of employment.  The SIU Credit Union offers Traditional, Roth, and SEP IRA accounts.  You may choose to invest in an IRA share account or an IRA certificate of deposit.  This allows you the flexibility you need when it comes time to access your funds.  All IRA accounts are insured for $250,000 through the National Credit Union Administration.

 If you currently have an IRA at another institution, or would like to start one, please contact me at 618-457-3957.  I would love to help you ensure that your road to retirement is smooth.

 Erica Pankey, SIU Credit Union IRA Specialist