Issue link: http://www.insightdigital.biz/i/140775
insight on BANKING & By Tom Groe nfeldt CREDIT UNIONs Smart saving Credit unions find creative ways to help clients grow their money C ommunity First Credit Union in Appleton figures it has saved members $17 million so far this year. That's the difference between what members were paying in interest for mortgages, credit cards and car loans to outside financial firms compared to the rates their local credit union offered, added up for the duration of the loans. "When we refinance a loan and bring it to Community First, we calculate the difference," Amanda Secor, senior vice president of marketing, explains. The sums come from the total savings over the lifetime of the loans. The goal is $100 million in savings over three years. The last couple of years haven't been easy for credit unions as they worked through the economic downturn. But now, credit union membership is bouncing back. "Another 13,300 people became credit union members in the first quarter," says Kim Santos, director of the state's Office of Credit Unions. "Total membership for all Wisconsin credit unions is closing in on 2.3 million people." Positive signs for credit unions statewide The Wisconsin Department of Financial Institutions (DFI) says that the state's credit unions grew income by 7.6 percent in the first quarter of 2013 compared to 2012, while total assets grew to $24.1 billion, an increase 32 | Insight • J u l y 2 013 of 3.3 percent over year-end 2012. "First-quarter credit union performance continued the very positive trend of 2012," DFI Secretary Peter Bildsten says. "Assets and net income are up. Loan quality continues to improve. Net worth remains strong at over 10 percent. These indicators are positive signs for the credit union industry and the Wisconsin economy." One of the ways credit unions are keeping members interested is by implementing plans and programs to help them save as much money as they can. "We see members who may be paying 5 to 8 percent, some in the teens on car loans. A lot of people, even though the rates are low, haven't refinanced their home," says Secor of Community First. "Going down 1 to 3 percent on your home loan can make a huge difference in your monthly payments. Our members can save 2 to 3 percent on a mortgage; it can make a real difference." Refinancing a car loan is very simple, she adds. Members apply and once they are approved, the old loan is paid off and the new one, at a lower rate, is opened with the credit union. "For one member it might be an auto loan. Or another member comes in with an auto loan and we take a look and realize we can save them money on their mortgage." Just because existing payments fall within a member's budget doesn't mean the rates can't be improved, Secor adds. Members might be paying 24 percent on credit cards that the credit union can offer at 8.9 percent. "How much does that save you? It lets you pay down your principal faster," Secor says. Advisers at the credit union can show members how to direct their savings into an account for a down payment, or a cushion account or a vacation savings account once they reduce their interest rates. Mike Mehlberg, lending and collections supervisor for Capital Credit Union in Neenah and Oshkosh, says that while his credit union doesn't offer a program of financial advice, he likes to meet with members and go over their entire financial portoflio to see what Capital can do to make their lives easier. Everyone is treated as unique, he adds. w w w. i n s i g h t o n b u s i n e s s . c o m