SAN ANTONIO -
Ask Christine Lopez, a member of San Antonio CU, and Charles "Chip" Lutz, a senior investment representative with the CU.
A 27-year veteran of Southwest Airlines, Lopez wanted to be free from worries about her retirement.
"I wanted to invest my 401(k) and profit sharing. I wanted a diversified financial portfolio to support my retirement. I want to leave an inheritance to my children. I wanted my money to work for me," Lopez told the Credit Union Journal. Why did she turn to Lutz? He was highly recommended by a friend, she said, but "ultimately, his background with SACU finalized my decision."
"Members come to me initially because they trust their credit union and our employees. That 'Credit Union Connection' or 'Trust Factor' is genuine and we prize it above everything else," Lutz said. "We do what is in the member's best interest, and sometimes that means referring them back for a share certificate or a savings account if there is a short-term liquidity need, or a need to build an emergency account before investing."
Going On A 'Fact-Finding Mission'
To help members like Lopez achieve their goals, Lutz said he starts off with "a fact-finding mission. I need to first ascertain where a member is currently, financially speaking, and then where they want to be. Before an advisor can recommend a solution or chart a financial course of action to take we need to first know where a member is currently in their financial lives. Income analysis, debt analysis, and other investment vehicles held elsewhere are of paramount importance to know right from the beginning," he said.
Follow-up that keeps the member informed is key. "They even provide a monthly newsletter with good information," Lopez related. "And you can also sit with a financial-adviser that will explain everything in detail."
"Part of our challenge has been making members aware that we can help them with their investment needs as well as traditional banking and lending needs," said Lutz. "When members find out we are a full-service 'investment solution' they are always pleased and eager to set up an appointment to review assets they have with us and investments held elsewhere that we may be able to help them better position."
The other challenge is taking a subject that is somewhat esoteric to most members and making them feel comfortable and knowledgeable.
Explained In 'Layman Terms'
"It was explained to me in layman terms that I understood, and it made a lot of sense. My knowledge as to what to invest in is limited," Lopez noted. "But Chip advised me to diversify and not have all my investments just in one stock or bond. He provided me with options: detail stocks and growth fund information. He assisted me to make good, sound decisions."
The proof?
"I'm enjoying retirement. I started art classes, travel, have gone on cruises and I'm just enjoying life," Lopez said. "I don't have to worry about looking for a job to make ends meet."
Having access to the right tools is equally important to Lutz as well. The program is managed by Gateway Services Group, LLC, a CUSO dedicated to providing investment program management and insurance services to credit unions. "Being with GSG has made a tremendous difference in my approach as an adviser and how our investment center is structured and managed," he said.
"We now have a systematic approach for ongoing communication with our clients. We send out handwritten thank you notes, service letters, educational newsletters and we establish annual face to face reviews and host annual client appreciation events."
All of that is a given for a CU operated program, said Judy Sandberg, VP of Strategic Direction for GSG, who is also a director and interim COO for the National Association of Credit Union Services Organizations (NACUSO). "It's the basis of earning and retaining the trust members have in credit unions and, through them, CUSOs."
Beyond that, GSG also conducts weekly, monthly, and annual educational/sales meetings that allow reps at their client CUs to better identify and share best practices among other advisers. "GSG is often first to introduce advanced tools that allow us to efficiently research products and produce professional financial plans," said Lutz.
Looking at member/clients in need of lifestyle financial choices is different from taking a 'transaction-based' approach, said Lutz. "In order for credit union investment programs and their reps to continue to overcome a perceived 'credibility gap', the breadth, depth and quality of the services they provide must constantly be advanced," he said.
"Statistics indicate that those reps who take a planning approach to delivering investment services are generally perceived as higher quality," Lutz told the Credit Union Journal. "In addition, those who embrace a planning approach generally have higher Assets Under Management-to-client and manage a larger percentage of their clients' total assets than those reps who focus more on a transactional approach."
Lopez crystallizes the emotion by saying, "Chip gives me good sound investment information, and it's not a sales pitch. It goes back to trust, honesty and the pride he has for what he does for a living."
Support From CUSO Financial
In a complex financial world, having a sophisticated broker/dealer is also a necessity, said Lutz. SACU's broker/dealer is CUSO Financial Services LP, San Diego.
"CFS supports its reps in taking a planning approach to working with members/clients," he said. "CFS is a technology leader and recognizes that reps were slow to adopt a planning approach given the labor-intensive process of completing a plan using a 'disk-based' or 'desk top'-based planning tool. As a result, CFS committed substantial resources to building a web-based, integrated version of Financial Profiles, 'Forecaster' planning tool that gives reps 24/7 access to the tool and does the 'heavy lifting' in terms of downloading client demographic and asset data directly from CFS's trading system."
Lutz believes it's the human assets combined with smart management and optimal use of technology that have made SACU's program so successful.
