Trusted News for Credit Union Leaders

Credit Union Times

JUNE 12, 2019 | VOL. 30 | NO. 19 | CUTIMES.COM

Must Reads

INVESTMENTS

‘Pensionize’ 401(k)s and IRAs In a world of defined contributions, American workers have three challenges – inadequate savings, leakage (or loans/early withdrawals) tied to their retirement accounts and the need for retirement income. Plus, just half of all DC plans offer a way for investors to transform balances into periodic retirement income, with only one in five offering guaranteed lifetime payouts.

This situation prompted Steve Vernon of the Stanford Center on Longevity, Wade Pfau of The American College of Financial Services and researcher Joe Tomlinson to explore and devise solutions to “pensionize” retirement plans. Their work, first published last year and then updated this year, finds that only one-third of workers contact financial advisors, and most lack the necessary skills to convert savings into retirement income and typically have short planning horizons.

But research from the Stanford Center on Longevity (SCL) and Society of Actuaries (SOA) has found a “straightforward retirement strategy,” according to the three authors. “Choosing a specific solution that will help workers generate retirement income requires them to make informed tradeoffs between potentially competing goals,” they explained, such as “maximizing lifetime income; providing access to savings (liquidity); planning for bequests;

HUMAN RESOURCES

Easing Financial Stress
When it comes to wellness, the
message is really quite clear: Al-
ways get to the root of the prob-
lem, instead of simply treating
the symptoms. That same ad
vice c n apply to ben fits advi-
sors and employers looking to
provide benefits that help em-
ployees improve their financial
wellness. This is especially rel-
evant when trying to help em-
ployees who are coping with
stress. Consider the following:
Many Americans are struggling
with unhealthy levels of stress
and it’s taking its toll:
• According to the American
Psychological Association’s
12th Annual Stress in Amer-
ica survey, almost half of the
respondents reported laying
awake at night due to stress.

• About half of the general population stresses over financial concerns, while more than two-thirds of millennials report having moder ate to high levels of anxiety about savings and income, according to a Northwestern Mutual survey.

These young employees, who comprise the largest and fastest growing generation in the U.S.

workforce, commonly struggle ith heavy student debt bur den, a lack of financial planning knowledge and fear of costly risks.

A study conducted by PWC found that employees who are stressed abou their fi ances are nearly five Y16

FOCUSREPORT:
CULTURE &
EMPLOYEE
ENGAGEMENT

The war for talent is real, and to stand out in a tight labor market, CUs must foster positive work environments. In this Focus Report, experts share ways to develop a workplace culture that your employees won’t want to leave. Y6

Priming Talent for Success Elevate your employees’ careers. Y10

Training for

Results

Fine-tune your
CU’s sales
program. Y8
t is insufficient for credit
unions to only serve people
who walk into a branch –
they must find ways to ex-
tend their perimeter, and literally
reach out to current and future
members.
Recognizing that financial in-
stitutions must become more
mobile, the U.K.-based Finastra is
bringing banking services outside
the branch with the launch of Fu-
sion Digital Front Office, a tablet-
based platform that enables credit
unions to take services directly to
their members.
“We were looking
to provide [financial
institutions] with an
innovative solution
that aligns with the
transformation that
we are seeing in
the market. Giving
them the ability to
really drive more engagement and
more interaction was really the im-
petus behind creating this product,”
Allan Brown, vice president/gen-
eral manager, digital, community
markets for Finastra, said.
Fusion Digital Front Office’s
cloud-based, mobile-first de-
sign utilizes tablets to untether
financial institutions’ ability to
service accountholders, open
new accounts and provide per-
sonal, relationship-building
opportunities.
Finastra Platform Extends CUs’ Reach

ROY URRICO rurrico@cutimes.com

Y17

FINTECH

Brown

Why Bank
Deals Are
on the Rise
PETER STROZNIAK
pstrozniak@cutimes.com

oon after the $1.9 bil-
lion Addition Financial
Credit Union in Lake
Miller did not
mind answering
their questions
about his bank
purchase experi-
ence, and that may
be a reason why
there have been
more credit union
bank acquisitions in Florida than
in any other state. In fact, Miller
said he won’t be surprised if other
Florida credit unions announce
bank purchases this year.

Credit union bank acquisitions are a national industry trend that is gaining traction because experts agree it’s actually easier to buy a bank than to merge with another credit union, and the ROI is typically five years or less. And at least one expert believes a new trend of bank acquisitions of credit unions may emerge, following a Texas bank’s purchase of a credit union, albeit a tiny one, earlier this year.