The latest economic news is making Americans poorer. In fact, recent reports indicate that two-thirds of Americans live paycheck to paycheck. Moreover, it is not only those who live close to the poverty line who are in difficulty. Fortune.com referred to a
published by LendingCLub which revealed that more than a third of paycheck consumers in the United States earn at least $250,000. Certainly, inflation affects how Americans of all income levels manage their budgets.
The reality is that many North Dakota and South Dakota consumers, including credit union members, are struggling today. Who can they turn to when their financial situation runs into trouble? Should they keep swimming and hope for the best? Or should they seek advice on how to stay afloat – and perhaps even safely reach the shores of financial well-being?
Nearly two years ago, the National Credit Union Foundation began leading credit unions across the country toward a mission it dubbed ”
.” What does that mean? Financial wellness for all is about motivating and helping people make smart financial decisions. Financial well-being is central to the mission of credit unions within their communities and deeply embedded in their structure; they want to help members achieve their financial dreams.
Credit unions also have a long history of helping consumers through difficult times. Since their founding days in the United States in the early 1900s, credit unions have flourished under the motto “Not for profit, not for charity, but for service”. During the recent pandemic, credit unions have done so much to help consumers and small businesses that they have become known as “financial first responders” by many trades.
What exactly can a local credit union offer to help its members feel financially secure about their future? Let’s start with the average savings a family realizes just by being a member. According to the most recent 2021 Member Benefits Annual Report released by the Credit Union National Association, credit unions provided $12,557,606,745 in direct financial benefits to 127,848,853 members nationwide in the 12 months ending in December 2021. These benefits are equivalent to $98 per member or $206 per member household. In the Dakotas, these savings are even greater: North Dakota credit union members save an average of $118 per year, or $249 per household; South Dakota members save $144 per year, or $302 per household.
While that’s a good start, credit unions offer so much more. Many have certified credit union financial advisors on staff and offer advice at no cost to members. These trained individuals are professionally prepared to help members who are experiencing financial difficulties. The Dakota Credit Union Foundation recently authorized a grant expense for local credit unions looking to add a financial education component or CCUFC to their staff.
Additionally, many credit unions will offer “Skip-A-Payment” programs for a nominal fee (often the fee is donated to charity) so that members can meet unexpected expenses and not damage their credit scores with missed payments. Other options for members in good standing can include loan modifications, budget assistance, not to mention lower interest rates on loans and lower fees on many services.
More importantly, whether a consumer is working with a local credit union, a small community bank, or even a large financial institution, it’s essential to be proactive with your financial situation. If you are swimming against a strong financial current and need assistance, contact your financial service provider(s) as soon as possible to discuss your particular situation. They may offer a financial “lifeline,” but at the very least, just like a lighthouse guides the ship, they should be able to steer you to safer waters.
Jeff Olson is President and CEO of the Dakota Credit Union Association.
This letter does not necessarily reflect the opinion of the Forum Editorial Board or the owners of the Forum.