Credit Unions buck the savings trend

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Credit Unions buck the savings trend

AUCKLAND, TUESDAY 7 MARCH 2006 – While New Zealanders are currently spending more than they earn, Credit Union members’ savings have increased by 40% between December 2000 and December 2005 to an average of $2,548 for each of its 170, 000 members.

Credit Unions in New Zealand have been teaching the benefits of saving for over 50 years and their members have grown their average savings at a rate of 8.67% each year over the past 5 years.

Doug McLaren, Chief Executive of the New Zealand Association of Credit Unions says, “While statistics report that New Zealanders are not getting to grips with the need to save, our members are bucking the trend by not only saving, but also growing their level of savings every year.”

“Attitudes to debt have changed in the past twenty years and student loans have helped to make young New Zealanders comfortable with debt. Many people will spend their working lives living on credit while paying only the minimum payments. They will be working twice for their money and never know the control that comes with being financially independent,” says Doug.

While New Zealanders, regardless of income level, struggle to understand the importance of saving, Credit Unions through education and products teach their members to plan and save towards a goal.

Doug says New Zealand has neglected financial education for too long. Easy credit, undisclosed fees, and a lack of understanding about finance are setting some New Zealanders up for a life of interest repayments and debt.

“Our members, many of whom have modest incomes, have learnt to save – sometimes the hard way. But the lessons we teach are; it is never too late to start saving, even small amounts make a difference, and you don’t have to be wealthy to save,” says Doug.

“We are proud that our members are leading the country in positive savings habits.”

As well as providing banking and insurance products at low or no fees, Credit Unions inform their members about the real cost of credit and teach them to use it wisely because incomes may drop, the job market may tighten, or the value of the homes may plunge. If no money is put aside to cope with hard times, those times get a lot harder.

New Zealand Association of Credit Unions

The Association was established in 1961 as the Credit Union League and later changed its name in 1989. It acts as the main trade association for Credit Unions in New Zealand and provides a range of products and services to its Member Credit Unions. Its 40 Member Credit Unions operate in more than 95 locations nationwide serving over 169,000 New Zealanders. The Association is a member of the World Council of Credit Unions and an affiliate of the Credit Union Services Corporation of Australia Ltd. The New Zealand Association of Credit Unions is a registered financial cooperative and is not a registered bank.

ENDS

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