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Student Credit Union

Credit Union :Alternatives
Assets :$63,850,000
Address :125 N. Fulton St | Ithaca, NY 14850
Start Date :1990

Rates, Fees, and Terms :

User Qualifications :

Elementary, middle or high school students at one of Alternative’s 9 student credit union branches

Rates, Fees, and Terms :

* Membership is $2 and a $1 deposit is required. For students whose parent or guardian is already a member of Alternatives, the $2 membership fee is waived. * Student savings accounts receive a higher interest rate than regular savings accounts

Vendors/Systems Used :

No special technology needed for elementary school branches. The credit union picks up deposits from the schools and tellers manually enter the transactions. At the CU’s live branches, a laptop and modem are connected to the CU to process transactions in real time.

Target Market :

Any student attending the Ithaca City School District with a specific focus on students who qualify for free or reduced lunches.

Marketing Strategy :

  • Word-of-mouth
  • PTAs
  • Assemblies
  • Flyers sent home from school

Program Results/Statistics :

There are 1,465 student accounts under the age of 19. Over 100 former student accounts are still active. Since the first elementary school branch was started four years ago, none of the 500 students from the six elementary school programs have graduated yet.

Member Benefits :

  • Student savings accounts receive a higher interest rate than regular savings accounts
  • Student members may open checking accounts that have no minimum balance or monthly fees; if under 18, a co-signer is necessary
  • A Visa debit card is available to those students with a checking account
  • Personal loans up to $500 are available to help build a good credit history; if under 18, a co-signer is necessary
  • Matched savings accounts, called Individual Development Accounts, can be used to fund education if the students’ family income qualifies

Additional Information :

Alternatives FCU started its student credit union program for middle and high school students, but found elementary schools to be the most successful. Each school model is different. In some, teachers and 5th graders volunteer to take deposits in the morning before school starts, but school PTAs have been the biggest boosters of the program, according to Joe Cummins, Community Development Educator. Parents come in early one day a week to take deposits with the students. “These parents see the value when their kids wake up excited because it is Savings Day,” says Cummins. The students who volunteer gain hands-on financial experience. Parents have expressed surprise to learn how interested their young children are in managing money, not just spending it. Even better is that 25% of the elementary students have two savings accounts which they use for long-term or short-term savings. “You know the program is having an impact when a 9 year-old tells you they’re saving for college,” notes Cummins.

The student credit unions were not set up to be money making programs. The credit union relies on volunteers to manage each site. The emphasis is on the importance of developing a savings habit – even if a small amount – so that by the time these children are teenagers they will have been saving most of their lives. The overall mission of the program is financial education – by doing. “Teenagers who volunteer as student tellers also learn valuable employment skills and some end up working at the credit union after school,” says Cummins, “which sure beats bagging groceries.”

The school coordinator’s job is to train and organize the volunteers, process new accounts, manage the flow of deposits to the credit union, respond to parent concerns, and create flyers and incentives to help support the branches. “As with any volunteer-based program, it’s important to have good volunteers, listen to them and support them,” concludes Cummins. “The parent and teacher volunteers are instrumental in keeping the relationship between the school and credit union strong.”