Over the last few weeks reports of the economic crisis and poor financial outlook are all over the news. I have seen several media segments in which money management “experts” are advising people to keep a portion of their money in “cash” as a safety net.
By this they don't mean actual cash, they mean cash equivalent accounts – insured deposit accounts that are liquid or immediately accessible – like credit union share savings, checking, and money market accounts. But they don’t actually say this on the air and I worry that they are sending the wrong message.
People who work in the financial industry understand what a “cash“ account means, but we should not assume that all of our members and the public watching those money management segments also understand this. I have heard from a credit union employee that members are coming in wanting to withdrawal large amounts of cash from their accounts in a misguided attempt to keep their money safe.
Front line staff need to be sure to understand and communicate that money held in these credit union “cash “ accounts are safe and liquid, they are insured by the National Credit Union Share Insurance Fund (NCUSIF). The NCUSIF is a federal fund that insures member’s deposits in a credit union up to at least the $100,000 federal limit.
When the media does talk about insured accounts, they most often mention the FDIC and fail to mention that credit union accounts are also insured. Like the FDIC, the NCUSIF is backed by the full faith and credit of the U.S. government.
Sometimes financial education involves very basic information communicated in person and through signage, website and statement messages. For more information to share with staff and members, visit NCUA at http://www.ncua.gov/ShareInsurance/index.htm
Keywords: economy, Financial education, share insurance