MatriMoney...how do you want it??

We are looking at two ways to get MatriMoney to the members?



Again I want to know what you prefer, and which your CU is more likely to grab onto. There are two ideas behind MatriMoney and what it can/should look like.



The first: Is the traditional CU implementation of MatriMoney. The CU will pick it up, they will use the established brand name and maybe even some consistent collateral, but how it will be handled will be based solely on the discretion of the CU. Have a look at North Island CU and Mountain America CU, they have both established some excellent MatriMoney wedding registry programs. Both are prime examples of an example implementation of MatriMoney at a CU. It certainly serves the purpose of the member, and that is the ultimate goal.

But here is a little bit bigger idea. Lets say that a a CUSO or some other CU oriented organization wanted to pick up and develop MatriMoney into a very in depth online registry. The members can establish goals, they will receive common collateral, and this will allow for online deposits to the account via Credit/Debit Card, ACH, and auto-drafts. So potentially Aunt Suzie in Germany who can't fly in for the wedding, can go online and deposit a gift without leaving home. You are thinking, well that is cool, but where is the CU involved?? The idea is that any and all CUs that want to participate will be able to "link up" with the MatriMoney website. The CU will actually be the account custodian, not the website, the website just provide a detailed online tool, to gather deposits for the account. So the individuals would be required to be members of a participating CUs to use the product. This would allow members who go to their CU to get the account and individuals that just heard about it and want to get it, can join a CU locally that they qualify for. (New member acquisition)

So that wasn't exactly easy to put in type, but I think you should be able to grasp the concept. In respect to what we are doing, we will continue to find and help CUs implement MatriMoney on a CU level, but we are also exploring the idea of finding a partner to develop the project to meet a much larger potential.

So I want your thoughts!!! As a CU rep, do you think that your CU would be more likely to take this develop and implement it themselves? OR Would they choose the other path, that is likely quicker, with less required development and join in on the much larger scale? What fits your CU best? What do you think is the potential for MatriMoney?

I look forward to your feedback it will be very useful moving forward. Thanks!!!

Chance at Large Prize or a Garunteed Small Prize

Which do you and/or your CU prefer for a Prize-Linked Savings account??

As we continue to develop the Prize-Linked Savings (PLS) concept, we are looking at two different avenues for the prize. I want to know which is better in your opinion, which appeals to you more, and if you represent a CU, which will most appeal to your membership?

***Not sure what a PLS is? Let me give you the basis of the PLS in one 3 short sentences. PLS is the idea that members are more likely to save money if they are given a chance to win a prizes and/or a large cash prize. For every (insert $ amt. here) they deposit to their PLS they get an entry into the drawing for the prizes for that month, quarter, and year. Okay now back to my question...

The first (traditional) construct of the product, is to have monthly prizes of vary value that range from several at $20, $50, $100, and even one at $1000. Of course in many cases, prizes such as iPods, TVs, etc., fill in for cash prizes. Then there is a larger quarterly prize, and an annual prize of $10k to $15k, depending on the CU. This prize is guaranteed and will be given away to one lucky member.

The second construct is a chance at a much larger prize. Say for each entry the member has a 1 in 1 million chance at winning $100k at the end of the year. This prize is not only non-guaranteed but the chance of someone/anyone winning it is very small. In addition to this large non-guaranteed prize they will also be able to similar monthly prizes as in the traditional construct.

So the main difference is that the CU can either give a member $10k or they can underwrite a chance to win $100k. So which do you prefer, if there will be smaller prizes won, would you rather play and be guaranteed that someone would get the $10k, or would you rather play and know that you have a chance to win $100k, an amount that most likely will not be given to anyone.

Which do you prefer? Which is a better fit for your CU? Which would your membership prefer? Thanks for the insight.

P.S. Your opinion could have an impact on how this product develops in the future.

Bring on the Implementation

So I finally make it up to Madison, WI, the center of CU world and otherwise known as "Mad City." The very first thing on my list of to-dos over the next 2 days is walk on the frozen lake. In Oklahoma, lakes dry up in the summer, they don't freeze in the winter. But being the dare devil that I am and seeing all the crazy ice-fisher guys out in their little tents, I brave the cold and ice and find myself on the frozen lake, alone and cold.

I will say that the trip did get a bit warmer, I got to meet dozens of great credit union people. I had the pleasure of touring the Credit Union Center, CUES, and even a little of downtown. I have two thoughts that stuck out more than anything from my tours:

First: The Credit Union Movement changes lives. I used to think it just consumed them for people like myself, but it really does change lives. While touring the World Council, I was able to see what all we do for people who are truly impoverished. If you are not already supporting the World Council in some way, I challenge you to do so. The Credit Union Movement makes differences in the lives of hundreds of thousands of people. I hope one day 40 years from now I can look back and know that I was a part of something so huge.

Second: Credit unions can make a difference and they can change. What credit unions have done in the past is amazing, what we are doing the present is awesome. But if we want to do more then just exist in the future, but really expand to provide great and fair services to people all over. We need to not just talk about change, and admire change, but we must make change happen. The world is changing at a sprint, credit unions can't take baby steps and think that they will keep up. I challenge you to not just talk about change but embrace it and keep the Credit Union Movement moving forward.

I want to say thanks to Maureen for setting up such an action packed 2 days in Madison. I got to meet alot of great people that I look forward to working with in the future. I believe that we as a movement can make a difference in millions of lives that don't know what a credit union is yet. "People helping People" is what we were founded on, and it is what we will continue to do.

How do we make a difference, how do we make change happen? You guessed it, IMPLEMENTATION. That's where you come in...

Deal or No Deal

I have no doubt that all of you have heard of this new game show by now. It is like "Who wants to be a Millionaire?" without the tough questions, just tough yes or no decisions. All you do is play a game of luck and chance, with the ability to make an educated decision. My wife loves the show, I do to a point. I find it very intriqueing to see the process that someone goes through to make the decision of when to sell their case, as most of them do. Even during the current "Million dollar Mission" where half of the board has $1,000,000 in the cases. The person has a 50/50 chance of getting a million. yet nobody wins the million, even those that have it in their case, sell it becuase they would rather be garunteed several hundred thousand then they would take the risk of getting next to nothing if they pick the wrong case.

Why do we also settle on less instead of take the chance to lose it all? Here is a few suggestions.

The always popular proverb "A bird in the hand is worth two in the bush;" is ingrained into our minds and grabs hold of us. Wonder why this is, well the proverb has lasted about 2500 years, and has variations in almost a dozen languages. It is found in one of Aesop's fables, a hawk seizes a nightingale, who pleads for its life, arguing that it is too tiny a morsel to satisfy a hawk. The hawk replies, "I would be foolish to release the bird that I have in my hand to pursue another bird that is not even in sight."

(I recently learned of its origin in the book that I am reading. Made to Stick by Chip and Dan Heath. I am not much of a reader but this book has captured me.)

Question: Would you trade $100,000 for a 1 in 5 chance at winning $1,000,000.??

Answer: I would bet that almost all of you would rather take the garunteeed $100k instead of a 20% chance at a million. I would.

Life is risky in so many ways, but when an individual is provided a garuntee, it holds much more value than a good chance at something much bigger.

So now we know why NBC hasn't given away their million dollars yet. How does this relate to the Credit Union movement? Well I think it is interesting to see how individuals will take risks with their money, but when it comes down to the end and the ultimate risk is there, they almost always settle for the safe answer. Credit Unions can provide the best of both worlds. We can be the safe alternative to other riskier asset accumulation methods, but we can use an individuals willingness to take risks to help them save money. That is the idea behind products like a Prize-Based Savings account. We appeal to the risky side while providing nothing but a safe place to store their money.

By the way. My wife and Mom want me to submit an application to be on the show, I think it might be a good idea, the only problem, is that I might be the first person, that refuses to deal money with a banker. I am more of a Credit Union guy. And they don't want to buy my box back, they want to help me get to that million dollars.

Prize Based Savings

It's not Gambling because there is nothing to lose

The Filene i3 group has an innovative idea that Credit Unions can encourage non-traditional savers to do just that SAVE. Well we are going to appeal to motives that usually cost someone money, not teach them to save it. The idea of a Prize Based Savings appeals to people who gamble or play the lottery, but it has absolutely nothing do with that.

A 2005 survey commissioned by the Consumer Federation of America (CFA) and the Financial Planning Association® (FPA) discovered that nearly 40% of low-income earners think it is more practical for them to accumulate significant savings by winning the lottery than by actually following a systematic plan for saving. Seriously if this isn’t an opportunity then I don’t know what is.

The Prize Based Savings can be developed many different ways, but the basics of it, is for every (insert amount of $) deposit a member makes they will get an entry for a monthly, quarterly, and/or yearly prize. This will encourage them to save because they have a much better chance to win at this than they do to win the lottery. But the key is that it teaches them to save money. Something that they likely were unable to do before.

There are a few different versions currently on the market: FORUM CU’s Weekly 5 Club, Neighborhood CU’s Prize Savings Account, and Centra CU’s Super Savings. All of which are tweeked differently to work best for their memberships.

As Credit Unions our job is to provide the best products and services to our members at the lowest cost. We do a great job. People all over the world find it impossible to save, as a Credit Union we need to do what we can to encourage and teach our members to save so that they are prepared for life’s challenges. This is a way that CU’s can do just that.

MatriMoney

A way for an engaged couple to ask for cash…without asking for cash.

What is this idea, MatriMoney? Simply put, it is a wedding gift registry for deposits hosted by a Credit Union. The idea is that a CU would offer a place for an engaged couple to establish a registry that would allow individuals that prefer to give money as gifts, a place to do so. The CU would give the couple a package that has cards with instruction on how to deposit. And on couples statements a list with the names of the depositers beside the deposits so that it becomes an easy and convenient list to make thank you cards with. (Nobody thinks about this until afterwards.)

In today’s world, couples are getting married much later in life. In most cases they have already established a household each or sometimes together. So why would they need a toaster? Instead of getting an iron, they would like to save up for the down payment on a house, or pay for their honeymoon, or furnish a new house. MatriMoney provides a convenient vehicle for couples to ask for cash without asking for cash.

The benefit to the CU is that MatriMoney gives them a service that will build or establish a relationship with both individuals. It will also open the door for cross-sell oppurtunities for other products and services. The newlyweds will be in the middle of combining lives, accounts, income, and the CU is right there offering cool and unique products that they can’t get elsewhere, why would they choose to put their accounts anywhere else. Most often the CU will have already established a relationship with one person in the new family, now they have established a relationship with both, and you have helped them work towards meeting one of their very first joint financial goals. What better way to start a relationship?

MatriMoney was piloted at North Island CU, go check out what they can offer to soon-to-be newlyweds.

It's not i2 it's i3

Completing the circle of i3... Ideas, Innovation, and Implementation.

Those are the three i's that the Filene i3 group is based on. But how successful has the i3 team been in meeting those objectives. Take a look at any number of their projects and you can see that they have been very successful at the first two. The i3 group hits extraordinary highs when it comes to creating new innovative ideas that can help Credit Unions expand their services to meet the changing member needs. But it seems there are challenges when it comes to implementation? Phil Smith an i3er from Minnesota coined the title phrase this afternoon, he is absolutely right, it is the Filene i3 group, not i2.

What good is having innovative ideas if those ideas to don't get back to the membership? Filene has been working towards providing the ideas and tools necessary for CUs to implement. Now Filene is stepping up their game. Maureen and I will be putting together proof of concepts for each that make it easier for CUs to take an idea and implement it. Anyone who has worked in the innovation process should know that not all ideas make it to the front-line, but as a CU we need to make sure that we implement as many as we can. Filene and CUs nationwide find themselves in similar circumstances, a whole bunch of a great ideas, without the ability to implement them all. We need to take the best and one by one make them available to the members.

As a Credit Union it should be your mission to make sure that you have the best products and services available to your members, to do this you need to be implementing, because innovation without implementation does nothing for your members.

Savings Revolution

Let's Start a Revolution...

Anytime the word “revolution” is used I immediately think of the destruction and rebuilding of a government. If you look at revolutions in history you see government systems being removed and rebuilt. Take American history for example, the American Revolution caused the destruction of British rule over the colonies and building of a democratic government. So what does this have to do with saving money? The destruction of a savings environment has been happening for a few decades, the reasons that individuals fail to save are numerous: the rising cost of living, value of the dollar, and the need to have more toys then the neighbor. All are reasons that people would rather turn to borrowing than saving. Members ability and motivation to save has eroded overtime.

What can be done about this? For a revolution to take place there has to be rebuilding. The Filene i3 innovators put their brains together and created the idea of a “Savings Revolution.” The Savings Revolution is the idea that through social media and credit-union collaboration, people can change their financial lifestyles to save money and reduce debt.

The family that comes closest to or exceeds its financial targets is named winner and is given a substantial prize usually around $10k. The revolution occurs by other individuals and families seeing the changes that the participating family is making in the challenge and they participate at home, by using online resources or resources at their CU to make changes to their financial lifestyle. Ultimately this will combine savings with reality TV and it will lead to a revolution of how thousands of CU members, and non-members save money.

But will it work?? That is a great question, it is early in its development. GECU of El Paso implemented it in 2007 and they had a lot of success, their deposits and accounts went up, but most importantly they helped countless members change their saving habits. In 2008, there are 4 CUs looking to implement the Savings Challenge.

This is just an introduction to the idea; there will be a lot more about the Savings Revolution in the near future. Teaching members to save should be at the forefront of the Credit Union Movement, how better to do that then through a REVOLUTION!!

Who am I?

Who am I:
Good question. Well in my profile it says my name is Kent Sugg. That is true. It also says my profession is banking. Well close, my profession is actually Credit Unioning, and since that wasn’t an option, nor is it a word, I chose banking. I should explain. My business card says that I am a Manager, Member Services at Tinker Federal Credit Union. Most days I carry the title well. But for the next 6 months, it is just my title. Who I actually am is the side-kick to the Director of Innovation Projects for the Filene Research Institute. Okay, I know what you’re thinking, you’re thinking, well side-kicks aren’t very important. Well now you know why I kept my title as Manager, Member Services.

Why I am writing this:
For the next 6 months, I will be working on the implementation of a few of the Filene Research Institute’s i3 Innovation projects. Maureen Maddox and I (she is the one with the important title, it’s an experience thing) will be working our tails off from different parts of the country to create and execute implementation strategies for these lucky products. The purpose of this blog is for me to document my experiences with the Sabbatical.

What will I write about:
The vast majority of this blog will be focused on the progress of the three Filene i3 projects: Savings Revolution, Prize-Based Savings, and MatriMoney. It will have tons of information that doesn’t go out in Press Releases about the experiences of Credit Unions in regards to innovation and even more importantly the implementation of all those great ideas. In addition to product information I will talk about my Radical Sabbatical Experience and even a few thoughts on the Credit Union movement.

My Credit Union Experience:
TFCU is the only place I have ever had a savings or checking account. I have worked for TFCU for 5 years. I was previously a teller, Member Service Officer, Teller Supervisor, and most recently a Manager. I have worked on several projects including the GenNext project at TFCU, which will be mentioned in future posts I am sure. I will also be mentioning Southwest CUNA Management School some, as I progress through my Three-Year Strategic Planning Project. Perhaps the biggest honor of my Credit Union career is being elected President of the Class of 2009 at SCMS.

My family history in one paragraph:
I am blessed to be the father of an amazing one-year old boy, Kaven, who has me trained well. I am also proud to report that his favorite word is “dada” and his favorite food Macaroni and Cheese. I met my wife, Thea (pronounced Tia) at TFCU 5 years ago, she wouldn’t go out with me because I was only 19, but we married a year later, so that worked out. She is currently a teller supervisor and aspires to be a stay-at-home mom. My dad is the manager of a glass business, he kicked me out of that line of work at 15, (Thanks Dad!!) so at 18, I went into my mom’s line of work. She is currently the HR Director at a Credit Union in Oklahoma City. She worked for TFCU for several years, and is probably the reason I got hired in the first place. She also did consulting for 5 years with numerous Credit Unions and State Leagues.

Other Disclosures:
So now you know who I am, and what I will talk about. I will go ahead and apologize for my poor grammar and inevitable typos. I welcome all feedback and look forward to getting your opinions on my opinion. Remember even though I will discuss mostly my Research Sabbatical and other subjects as related to the Credit Union movement, the opinions expressed in it are mine and don’t always reflect the opinions of the Filene Research Institute or Tinker Federal Credit Union.