MADISON, Wis. — The phenomenon of members putting off retirement due to the recession is creating a golden opportunity for credit unions to position themselves as the trusted adviser to help them navigate their way back to retirement.
John Vardallas, CEO/founder of TheAmericanBoomeR, here, said that delaying retirement is crossing all businesses and industries, as millions of baby boomers have lost much of their nest eggs and cannot afford to retire and are facing the same issues. "Folks will have to be engaged in some form of employment to stay viable and support their lifestyles as we go," he said.
According to Vardallas, this results in a golden opportunity for credit unions to position themselves as the financial institution of choice to help members with their retirement needs.
"Helping Boomers manage their retirement accounts, long term health care, reverse mortgages, credit scores, deal with job losses, is where credit unions can be heroic during this time of need for consumers," Vardallas said.
From would-be retirees themselves, there is a lot of nervousness, Vardallas said. "My No. 1 advice I give is first, take a step back and look at the situation, and now strategize for the future," he said. "Maintain yourself. This is the same thing I tell credit unions. Maintain your members. Focus on the members you already have. It is much cheaper to retain current members than it is to attract new members."
Safe, Secure With Money to Lend
To help keep these members, Vardallas said credit unions need to tell their story. "We didn't get involved in toxic loans. We didn't take a lot risks. We're safe, secure and have money to lend," he said. "We need to tell our story more, rebrand ourselves. We're the best-kept secret in the financial service industry. We can help current members with counseling and education, help people deal. It's a very interesting time. The whole retirement issue will affect Boomers in general. We're seeing it across all industries. A lot of folks are jumping to take more out of their retirement to live their life. Helping them with their retirement planning is huge. Offer retirement planning services. The point is, it's time for the credit union to look and see how they can be heroic. Membership should have its privileges." There will need to be products and services to help these people, Vardallas said. "Banks aren't doing that."
This leads to a great opportunity for credit unions, he stressed. "Flaunt who we are," he said. "Market. Branding. Have members be advocates in the community. We're going back to basics. We're member-owned. We need to re-establish ourselves to tell out story more. Credit unions needs to get out there, tell our story more, and be there for these members. If we are the ones helping now, we will flourish in the future. People remember who was there in their time of need."
Charles Shanley, executive search director with JMFA Executive Search Group in Baytown, Texas, agrees, saying that credit unions should be offering special products and services for members in this situation. "If they're not doing that, they need to," he said. "There's a huge number of opportunities to serve this group. We're also seeing an increase in services such as free financial counseling. That's a great program."
Diane Wozniak, HR manager for Tampa Bay FCU in Fla., and member of the executive committee for CUNA's HR/TD Council, said that the CU has not changed its marketing efforts or product offering in this regard yet, but added that it "could definitely be an opportunity to determine needs for our members."
