No Childish Rate For Kids' CD Promotion at Gateway Metro FCU

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ST. LOUIS, Mo.-Children of Gateway Metro FCU members can receive the kind of CD rate their parents can only long for: 10%.

The $180-million credit union has been offering a 10% Youth CD since 2008 and has 202 accounts for over $170,000. The goal is to reward children of parents who consider the CU their primary financial institution and to help youth learn the value of saving.

"We wanted to get everyone's attention with this rate, blow it out of the water," said David Barton, who recently retired after running Gateway Metro for 17 years. He was succeeded as CEO by Larry Pixley. "You see banks and other credit unions go after high school and college students. We think we can get them younger than that."

The Youth CD is available for young adults between the ages of 10 and 17, who can add to the CD as they get older, having up to $1,000 in the account. At the age of 16, youth must take a financial literacy course, and on their 18th birthday the CD matures and is moved into a standard CD with a term set by the member.

Barton said the CD is one of the reasons the credit union's average member age has dropped from 45 to 43. GMFCU is also the only credit union in Missouri with branches in elementary schools, noted Barton.

The Youth CD is only available to members whose parents have checking and direct deposit. In 2005, the CU instituted relationship pricing to encourage more members to make GMFCU their primary financial institution.

Barton agreed that paying such a high rate on the Youth CD was done to draw attention, especially since the $1,000 maximum deposit raises no ALM concerns.

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