21 April 2011

Credit Union members increase savings supporting national trend

A South Island credit union supports predictions New Zealanders are getting better at saving, citing a 30% increase in deposits during March into one of its main savings schemes, compared with the same time period last year.
NZCU South’s CEO, Andrew Leys describes the increase in savings in its Christmas Saver scheme as highlighting a real change in attitudes towards saving.

“It’s great to see that our members are recognising the benefit in starting their savings for Christmas early, rather than relying on credit cards to get them through and ending up in debt,” says Andrew Leys.

Christmas accounts help over 28,000 credit union members all over the country maintain regular savings habits every year.

Although earthquake damage has temporarily closed the NZCU South branch at The Palms , NZCU South is expanding the number of its branches in Christchurch, with a second branch opening at the Hornby Mall in early June. Despite difficult times NZCU South membership has shown steady growth, up 5% in 2010.
Andrew Leys says the trend in savings supports comments by Finance Minister Bill English that New Zealanders are looking for ways to save, rather than resort to borrowing after spending. Mr English has been saying New Zealanders are heading away from the “sugar fixes”of borrowing, consumption and retail spending, and towards saving.

“This is a real indicator of changing habits. People want to save and pay down debt. We are making it easier for them for them to do this and manage their finances, whatever their goal might be. I believe people are looking to make a change to saving now to pay for Christmas, rather than borrowing afterwards to pay off the debt,” says Andrew Leys.

The trend is backed up by the NZ Institute of Economic Research’s (NZIER) Quarterly Survey of Business Opinion which estimated the current savings rate to be about 2 per cent of income, the first time it was a positive figure since the early 1990s, rather than people spending more than they earned by borrowing.

NZCU South customers can deposit regular amounts into their Christmas Saver throughout the year. The Christmas Saver money is available before Christmas each year when cash withdrawals and transfers are available free of charge.

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