Posts From November, 2014

Credit Unions and Small Business: Their Underdog Story 

By: Austin Rigby
November 25, 2014 Categories: bank alternatives

Near the steps of the Philadelphia Museum of Art stands an iconic symbol, a statue, for Americans. This statue represents a man who would get hit over and over; sometimes he would fall, but ALWAYS he would get up and keep on fighting. That man was Rocky.

Rocky is just one of the many underdog stories we love here in America. We want the little guy to win. We want him to overcome the big forces that seem to have all the money and resources to do whatever they want. The little guy has to be thrifty, cunning, and come up with a unique plan so he can win in the end. The underdog’s secret and x-factor is heart. They simply want it more!

The underdog is ingrained into our blood as Americans. Just look back at how we started as a nation. To win our independence, America had to go up against the number one power in the world. England was such a powerful country, that it was said, “the Sun never sets on the British Empire”. Looking at the resources the Americans had in comparison to the British, we should have had no shot in winning our independence. What was the secret to our success? It was our x-factor, we wanted it more!

It seems like today’s underdog attention focus is on sports and movies, and we seem to forget about the real-life, day-to-day underdog battles that are happening all around us; those of the small business. Within the last few decades, the buying and consumption of objects are unique. No longer are we going to markets and vendors to buy our food, instead we go to places such as, Acme, Shoprite, or a Costco. If we need household supplies, we go to Target or Wal-Mart. All of our spending takes place at “Big Box” stores. Small businesses may not have all the fancy commercials or advertising that large businesses have, but they do have quality products.

Small businesses are usually run by owners, which means that they are extremely invested into the day-to-day events of their business. When I go to the grocery store, I feel like I am experiencing the McDonalization process. I just go through the check out line as fast as possible with very little communication with the clerk working there. To add onto this, many stores are removing human clerks and replacing them with “self check out.” That’s the beauty of small businesses, they have people to interact with you. Lets not forget the importance of human-to-human contact. These business owners know the product, which they are selling inside and out, so it is easier to help customers by answering questions and solving problems. Other than the human touch, small business is extremely helpful to America’s economy. Forbes Magazine had some interesting statistics about small business. “There are almost 28 million small businesses in the US.” “Over 50% of the working population works in a small business.” “Small businesses have generated over 65% of the net new jobs since 1995”. You see, small business doesn’t just offer quality products with people who know what they are talking about, but they also provide a ton of jobs for the American economy. These small businesses could range anywhere from Mom and Pop pizza shops to jewelry stores.

One example of these small businesses, which offers many jobs to Americans, is credit unions. According to the Credit Union National Association’s (CUNA) mid-year report of 2014, the nation’s credit unions employ about 270,000 people.

The origins of credit unions date back to Germany within the 19th century. Herman Schulze-Delitzsch worked with his community to organize a mill and bakery, which would sell bread and reduce prices. Many years later in Quebec, Canada, Alphonse Desjardins organized La Caisse Populaire de Levis to help the citizens have affordable credit because everyone was being charged ridiculous prices for loans. Desjardins would a few years later open the first credit union within the United States of America, the St. Mary’s Cooperative Credit Association. Credit unions’ purpose is to help the little guy, the underdog, be able to acquire goods and services at reasonable prices. Credit unions’ purpose isn’t to get the Board of Directors or shareholders rich, it is to help all the members succeed financially.

A more modern example of this is First Financial Federal Credit Union (FFFCU), based in Wall, N.J. FFFCU was started by a group of Asbury Park schoolteachers during the Great Depression. This small group of people worked together to support each other and grow. Many years later, in 2003, the credit union expanded to support all who live, work, worship, or attend school within Monmouth or Ocean Counties.

Just this week research has come out from American Customer Satisfaction Index, proclaiming that credit unions have the highest customer satisfaction score of all financial institutions. To quote CUNA on this, “ACSI…ranks credit unions substantially better than traditional banks on every component including expectations, quality, value, loyalty and having lower complaint rates. This is the seventh consecutive year that credit unions have ranked above banks.” You see, the little guy, the underdog can out-perform the bigger business of the world! Credit unions outperform banks, because they care more about their financial cliental, their member-owners. Credit unions work harder to help their members, because they have that x-factor, they have heart!

Credit unions, pizza shops, jewelry stores, and all other small businesses have a special day to celebrate how they stick it to the “Big Box” stores by providing quality goods to their communities. Saturday November 29, 2014 is the fourth annual Small Business Saturday. Small Business Saturday is a national event to give back to the small businesses of America. All over the USA, small businesses will be working together to help customers see how they are such an essential component of the community. These businesses provide to our communities through job creation, sponsorships, and quality products. So, go find those small businesses that are participating in Small Business Saturday within your community and visit them with your families. If you would like more information just go to their Facebook page!

So, go visit your neighborhood small business! Go say hi to your local credit union employees! Go and witness these everyday underdog stories prevail right in front of your eyes!

Gratitude and Credit Unions. Can they Coexist? 

By: Austin Rigby
November 20, 2014

I LOVE THANKSGIVING! Let me paint a picture for you…The morning starts off with my dad, sisters, and I driving into town for the annual Turkey Bowl. After touchdowns, missed tackles, and injury close calls, we drive home and kerplop on the couch. While we try to be lazy and watch football, my mom tries to rouse us kids to help with the Thanksgiving meal. Eventually this tug-of-war ends, when the meal begins. There is nothing like sitting down to a meal with your parents, sisters, crazy uncles, loving aunts, cousins, and neighbors. Then there is the feast. It is filled with turkey, stuffing, hot rolls, mashed potatoes, sweet potatoes, cranberry salad, and did I mention the mashed potatoes? FYI, I LOVE MASHED POTATOES! After dinner, we end up trickling back in front of the TV to watch the next football game. Then, to the displeasure of our bodies, we return to the kitchen for pie. I think I could survive on a diet of just mashed potatoes and pie! Games, football, sleeping, and picking at food continues for the rest of the evening. There is nothing like Thanksgiving!

But there is one part that I look forward to the most about Thanksgiving. More than football. More than sleep. Even more than pie and mashed potatoes. It is the gratitude shared. As we are sitting there ready to dig into the feast, my dad expresses some of the things for which he is grateful. Then slowly, one-by-one, we go around sharing with our loved ones the things that matter most to us. While we are waiting to feed our faces, we take a few moments to feed our souls. Now we aren’t perfect, someone always tries to “sample” some of the food while we share what we are thankful for, but this can’t outdo the effect on us, how this brings us closer together as a family.

Gratitude is a gift, especially when we share it with loved ones. As G.K. Chesterton said, “I would maintain that thanks are the highest form of thought; and that gratitude is happiness doubled by wonder.” So for this Thanksgiving, I want to share with you some of the things that I am grateful for. I am grateful for car heaters (mine is nonexistent), getting my college degree, my family, smiles, raspberry pie, and credit unions. There I said it: credit unions. It might seem kind of self-promoting if I am talking about how I’m grateful for credit unions on a credit union Web site, but let me explain.

When I was a kid, I came home from school one day and saw boxes sitting on the dining room table. My parents came into the room and went on to declare that my dad had decided to walk away from his job…“but don’t worry,” they said. “He will have a new one in the max of six months.” My new worries vanished, and my sisters and I decided to carry on with life. Time passed, and soon we hit the six-month mark and still my dad had no job. Then we hit the 10-month, then a year, then a year and a half, and THEN two years. I couldn’t believe it; my parents promised that Dad would have a job by now. A few weeks latter, I came home from school to hear some good news: my dad had a job interview with a credit union. When he told us kids this, I wondered what in the world is a credit union? To our delight, my dad got the job and blessings have followed. One blessing is that with a job, my dad could buy food for us to eat, clothes to wear, and supplies to go to school. Secondly, because my dad worked at a credit union, I have had an opportunity to see how they worked, first-hand. You may have heard that credit unions value their financial participants. If you are a part of a credit union, you become a member, and instantly part of a big family. At the credit union my dad works at, I have seen countless people coming in and developing friendships with the tellers, loan officers, and administrative staff. Credit unions have that family feel, which mirrors what I love about my own family. I am grateful that credit unions have helped my family and given them a financial institution that treats them like family.

Henry David Thoreau said, “I am grateful for what I am and have. 
My thanksgiving is perpetual... O how I laugh when I think of my vague indefinite riches. 
No run on my bank can drain it for my wealth is not possession but enjoyment.” This Thanksgiving season I invite you to think about the things for which you are grateful. We learn from Mr. Thoreau that gratitude is one account you can’t over-take from. As you think about the things for which you are grateful, write them down, and share them with those you love or with us here at Banking You Can Trust. Looking at the things for which you are grateful will give you an opportunity to reflect on the good things in life before attacking the problems. G. B. Stern said, “Silent gratitude isn’t much use to anyone.” So, share.

Actually, the Research Shows! 

By: Austin Rigby
November 18, 2014

American Customer Satisfaction Index Ranks Credit Unions as No. 1 in Financial Services

When I was in college, I had a sociology professor who told us students about his experiences whenever he interacted with colleges, neighbors, and friends. He was surprised to hear people proclaim “facts” about different subjects, when these “facts” were based off of their opinions or misguided “common sense.” Whenever my professor heard such an outlandish remark, he would reply “actually, the research shows,” and then go on from there with legitimate research to support such claims. Many times after my professor got done rebuking the audience with actual research, they would be stunned and walk away.

While many people have different opinions when it comes to comparing banks with credit unions, lets follow my professor’s advice and “actually see what the research shows.” The American Customer Satisfaction Index (ACSI) released this month included findings about customer satisfaction amongst different financial institutions. To quote the Credit Union National Association, “ACSI is the only national cross-industry measure of customer satisfaction in the United States. The Index measures the satisfaction of U.S. household consumers with the quality of products and services offered by both foreign and domestic firms with significant share in U.S. markets.”

And in this research, credit unions ranked first in customer satisfaction with a score of 85 out of 100, while the average bank score was at 76.

So what measures was ACSI using in their research? Some aspects were expectations, quality, value, loyalty, and lower complaint rates. Guess who had better scores on each component? Yes you got it; it was credit unions!

Claes Fornell, ACSI Chairman and founder had this to say: “A growing number of consumers are finding that the best way to avoid bank fees may be to avoid banks altogether. Credit union membership growth broke records in 2014, and their customers are far more satisfied. The structure of credit unions means they can charge lower and fewer fees, but they still manage to provide superior service in nearly every area, from tellers to websites. Banks can’t easily give up the revenue that fees generate, but clearly the pressure is on to improve service.” Is this opinion? No! It’s fact!

The research from ACSI continues to support credit unions. ACSI found credit unions were first in five categories within financial institutions. They were first in the availability of products and services, the ease of making account changes, interest rate competitiveness, in understanding account information, and in courtesy and helpful staff.

Still don’t believe the research? Well, two independent sources measured consumer trust between credit unions and banks. In August, the Chicago Booth and Kellogg School Financial Trust found that credit unions received a trustworthy score of 60% in comparison with banks who had a score of 30%. Just last month, a Harris poll found that credit unions have more trust than banks. Trust in credit unions is even staying steady, while banks’ trust is declining.

Why are customers finding credit unions to be more useful in their financial needs? The research shows a couple of reasons. One reason is because at credit unions, people aren’t seen as customers but as members. By being a member, people have their own voice about the direction the financial institution goes. Also every member of a credit union has an equal share of ownership. This means the members of the board have an equal percent of ownership as the new guy who just opened an account.

The second reason why customers members are finding credit unions more useful is that they have higher expectations out of their financial institution. The members want it better, so the staff members at the credit unions do all they can to provide this. The past two years, member expectations have increased with a byproduct of increased satisfaction scores for credit unions.

Third, people are far more loyal to credit unions than banks. In the ACSI survey it was found that people would continue to do business with credit unions is higher (nearly 20%) than all other measured financial institutions.

So take your newly acquired knowledge and whenever someone brings up how banks are better than credit unions, you can proudly proclaim, “Actually, the research shows!”

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