It’s Time to Develop a Comprehensive Savings Program

Christian Mullins
May 11, 2009 | COMMENTS

With the world in a recession, savings has become the new spending. Personal finance is no longer counted amongst politics and religion as casual subjects better left untouched. People that had previously discussed vacations or their latest big item buy now talk about how much they lost when the stock market crashed. It's at the forefront of everyone's thoughts, from rich to poor, and we all share a strange comfort in knowing that everyone around us is in the same boat.  There aren't any quick fixes, but most people are beginning to understand the need for a solid savings foundation beyond the stock market.

The problem credit unions face in fully realizing the potential long term gains of this current mindset is that very few spenders successfully transform into savers. The spender-members know they should save, and it is within the ability for most of them to do so even in a recession, but as credit unions we have largely failed in developing a set of mechanisms for these members to successfully save over the long term. As soon as the economy rebounds, savings built through the fear of the unknown will ebb or even decline for many of these spender-members.

Financial seminars, youth savings accounts and a myriad of certificate offerings are a start but they're only pieces of what should be a comprehensive and easily identifiable savings program.  Every credit union should have a plan in place to assist any member that wants to increase their savings from $A to $B, and the credit union's involvement should extend beyond handing out savings pamphlets or budget charts.

A fully developed long term savings plan requires time, thought, and planning, and it's unlikely to significantly ‘bump up' your deposits, but that's where any downside ends. It's a public relations marketing tool, both in direct and word of mouth advertising and, more importantly, it will improve the lives of a few members that have tried, and failed, to save with your credit union's current products and services.

Reprinted with permission from CU Potential, a blog written by Christian Mullins, a 14-year-veteran of the credit union industry.