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Credit Unions Provide Free Counsel in a Time of Need

Credit Unions Provide Free Counsel in a Time of Need By Cyndi Cohen
Published February 23, 2012
Credit Unions Online
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While venturing on the sea of life, most credit union members have faced or will face some rough waters in terms of finances. Especially in today’s volatile environment, the economic ebb and flow is uncertain.

According to Moneyzine.com, in 2011 Americans were juggling about $796 billion in credit card debt alone. The following statistics tell the story in detail:

  • Average credit card debt per household with credit card debt was $6500 by the end of 2011;
  • 80% of Americans owned a credit card;
  • 4.5 % of cardholders were 60+ days behind on payments;
  • The average consumer was carrying 4 credit cards;
  • At the end of 2010, there were approximately 1 out of every 160 Americans were filing bankruptcy
  • Over 2 million Americans sought some form of credit/debt counseling and out of that group the average totals debt was $43,000.

While a small current in your finances may be easily navigated on your own, a tidal wave may require a life jacket or at the very least, a buoy. Rest assured knowing that you can rely on your credit union for the knowledge and guidance to help get your vessel back on track and return to smooth sailing! Many credit unions offer financial counseling services to members who are in financial difficulty, or who just want someone to help them set up a budget or review their credit report.

Budgetary Counseling: A Valuable Credit Union Perk

Maybe you are experiencing some hard times due to job loss or income reduction, and as a result are late on monthly payments or unable to pay your bills at all. Perhaps you are going through a personal issue such as separation or divorce and have fallen behind on your credit card payments. You may simply need the help of a professional to develop a budget and savings plan or to counsel you on home buying basics. Free, confidential budgetary counseling from a trusted resource like your credit union could be just the tool you need to keep your head above water.

At TruMark Financial Credit Union (Trevose, PA), budgetary counseling is designed to be proactive. They counsel members to reveal where all the dollars go, helping to open their eyes to the see the big picture and assisting them with current hardships as well as future financial problems. According to John Monari, VP of Collections, his credit union uses a budget worksheet while also advising members that assistance is available through 3rd party agencies and how to obtain credit reports.

At TruMark Financial all members requesting a loan modification go through a budgetary session as well as members who make multiple requests for higher interest rate products. Additionally, a member can request a face to face meeting with their counselor.

Monari says that assisting members through hardships has seen some real positive responses and, in general, counseling sessions have added strength to their brand. “Our primary goal is to objectively assist members make sense of their personal finances - going over their financial responsibilities in a structured fashion often allows for a fresh perspective and in this manner we can suggest opportunities or identify previously unseen challenges.”

Monari feels that credit unions and budgetary counseling are a fantastic match. “Membership is best served with an objective review of financial strengths and weaknesses…identifying opportunities to assist members meet future goals is a true win-win,” contends Monari.

Credit Unions Bring BALANCE to Members’ Lives

Veridian Credit Union (Waterloo, IA) offers the BALANCE Financial Fitness program to its members. According to Angie Weekley, Manager of Community Inclusion, the BALANCE Financial Fitness program is a financial education and counseling service designed to assist members with every aspect of managing their finances. This program assists with almost any financial goal, including how to develop a budget, tracking spending, buying a home, getting out of debt, or researching ways to improve your credit.

Veridian members seem to be making good use of the program. In 2011, BALANCE representatives received 258 calls to assist members with financial matters such as debt management and credit report assistance. Members can also use online modules to learn about a variety of financial topics. The online modules were accessed 2,540 times last year.

Weekley says that members have been very pleased with the program. “The goal of the program is to provide our members with tools to create a successful financial future - it teaches members how to set goals to pay off debt, purchase a home, plan for retirement, and more,” she explains.

Redwood Credit Union (Santa Rosa, CA) also offers its Members free access to confidential credit counseling, as well as budgeting help and other financial assistance through BALANCE Financial Fitness. More than 2,000 Members contacted BALANCE in 2011, and more than 100 scheduled appointments for financial counseling specific to their needs.

RCU’s staff listens and asks open-ended questions to determine each members’ unique needs, and identify goals. Based on the member’s needs, the credit union offers personal assistance with credit report review and recommendations, setting financial goals, budgeting worksheets, a “fritter finder” to help members identify unnecessary spending, creating an emergency fund, reviewing current debt and refinancing where possible to lower interest rates, and financial planning (for retirement, college, etc.).

Additionally, Redwood offers a variety of tools and resources to help members manage their money for short and long-term financial peace of mind. These include online tools and resources members can use to improve their financial lives, free credit counseling, and personalized financial assistance from our staff.

According to Robin McKenzie, RCU's Senior Vice President of Marketing & Commuications, in 2011, RCU hosted an Amazing Savers contest to showcase the ways her credit union can help people improve their finances. 5 Member teams competed to transform their finances for a chance at winning $10,000. Each team worked closely with a financial coach from RCU on budgeting, financial planning, setting up an emergency fund, credit report review and clean-up and more. All 5 teams improved their credit scores and refinanced debt to improve cash flow. All the tools and resources used by the Amazing Savers contestants are available online on their website.

Annually, the credit union also hosts two teen Financial Literacy Academies for high school juniors and seniors that cover a wide range of money management topics including budgeting, goal-setting, principles of credit, investing, insurance and more. These courses are designed to help teens learn strong money management skills that will benefit them throughout their lives.

Through the credit union’s website, members have access to a wide array of podcasts and educational articles on topics such as financial planning, the psychology of spending, buying your first home, financial first aid and more. “We are also planning to expand our selection of helpful money management tools and resources when we present our new and improved website this coming spring,” explains McKenzie.

RCU regularly communicates that members can obtain their free credit report annually at www.annualcreditreport.com, and strongly recommends that people review their credit reports to ensure that the information is correct and up-to-date. “We are happy to help members review their credit reports and support with recommendations on how they can improve their credit scores,” says McKenzie.

McKenzie says that Redwood’s overall goal is to help their members achieve financial wellness and feels that members appreciate that they provide them with the tools and resources to take charge of their budgets and goals and improve their financial lives.

“We believe that a strong budget is the foundation for financial success—both for consumers and for small businesses—so we are focused on helping our members learn budgeting and money management skills to help them achieve a better financial life,” contends McKenzie.

So if you have been floating along, looking for that financial rescue boat, look no further than your credit union’s budgetary counseling program. If you are not a credit union member but would like to be part of a financial institution that is there to help guide and support you through good and bad times alike, find a local credit union and join today.

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