Benefits of Banking with a Credit Union

Becoming a member of a financial institution, such as a credit union, lays the foundation of your relationship to money. From there, you can determine how your lifestyle can align with your financial priorities. Mehdi Dinia, Vice President of Membership, and Clay Stackhouse, Regional Outreach Manager, discuss the benefits of a credit union and how we put members' best interest first. 

Transcript

[MUSIC PLAYING] - Hi, and welcome to the podcast MakingCents, brought to you by Navy Federal Credit Union I'm your host, Emily Bigham. And each week, I'll be taking your questions to the experts to help you make sense of your money, pun intended. 

Hi, and welcome back to MakingCents. Today on the podcast, we're going to be talking about the benefits of banking with a credit union. Joining us today is Mehdi. He is our VP of membership, and Clay, who is our Regional Outreach Manager. Mehdi, you've been here at the credit union for over 15 years. That's pretty amazing. Can you get into a little bit about what a credit union is? 

- Yes. Thank you for having me. I'm so excited to be here with Clay and talk about this important topic. So a credit union is a member-owned, not-for-profit financial institution. And I think that's a very important thing to remind consumers in general, is that we're not for profit. 

And what that means, that all of our earnings, all of everything that we do goes back to our members. It goes back to our members in forms of products, in forms of lower fees, better rates, and better member service. And so I guess one of your questions might be like, what's the difference between a bank and a credit union? And that, I think, it's the base or the crux of that question is it's a member-owned and not for profit. 

- Got it. 

- I agree, Mehdi. And I'll tell you, being an outreach manager, I get to talk to people all over my area about it. And they get to that right away. And I say, do you know that banks are in business to make money? Credit unions are in business to serve their members. That's all credit unions. 

If you're a teacher's credit union or a policeman's credit union, we just happen to serve military veterans and their families, which is why we're the largest one in the world. We just went over 14 million members. So yeah, but I love the way you said it. You're an academic in savings and membership. And the bottom line is it's a pool of a bunch of people's money that are helping each other. 

- Yeah, another way to put it, if someone's familiar with the bank, is the members are the shareholders. And when we say that everything that we get, we give back to the members in the form of low rates. A good example of that would be our credit card rates. They're capped at 18%. And with high rates right now, there are some banks where you're going in the 20s, possibly the 30s. 

So whenever I'm explaining it to people, that's a tangible thing that they can think of. You have that because we give everything that we make back to you. And it makes for a really fun job too. It feels good. So why choose Navy Federal over other credit unions? 

- So first of all, because we are a credit union, there is an eligibility process. You have to be eligible to become a member of Navy Federal, similar to other credit unions. And so if you're eligible, then becoming a member of credit union of Navy Federal has different meanings, ones that apply to most credit unions. 

Like we said, it's not for profits. It's member-owned. We're talking about lower rates, lower fees, or higher rates in terms of saving rates. 

But I believe what makes us really special is the population we serve. We serve those who serve us and those who serve in the military, their family members, veterans, as well as the DOD civilians. 

And I think a really nice thing to think about. It's a sense of belonging, if you will. We have that common bond that is the military. And Clay here, has served for many years. And I want to thank him for his service. But just being able to share a lot of stories and being able to be on projects or talk to Clay is really rewarding for me as an employee here of the credit union. 

- That's nice of you to say, Mehdi. And for me, it is very personal. Being in the Marines for 25 years and just living the life of using our products and services, but also my son is on the USS New York right now, right off the Coast of Lebanon as an infantryman. And what we've done with him is, we got him the Secured credit card to bring up his credit score, and now he's in our Rewards card. 

But as a parent, it's different being a military member and being the parent of a military member, I'm figuring out it's much different because I didn't worry so much about myself as I do my son. But I'll tell you, the one thing I don't worry about is him being taken care of financially like I have been for, I think, the last 38 years. 

But when people say, well, OK, I'm in the Air Force, why should I join Navy Federal? And I'd say there's three things. I'd say lifestyle, products, and security. Your lifestyle, if you're deployed, we have over 360 branches all over the world. I know Mehdi is very exotic. He was born on the continent of Africa. 

And I got sent to Africa a lot when I was in the Marine Corps. And toward the end, I got sent to a country in East Africa called Djibouti. And I got sent to the capital city of Djibouti, which is also Djibouti. 

So I got off the airplane in Djibouti. Djibouti, kind of sifting through the goats and the runway to get to my luggage. And boom, I looked up, and I saw a French Foreign Legion guy. They're all fancy. I'm like, whoa, why is there a French Foreign Legion guy? 

Well, there's an active French Foreign Legion post in Djibouti, Djibouti. You know what else there is? 

- A Navy Federal.

- Navy Federal Credit union, that's right. As a matter of fact, our own Cara Cardona was the branch manager there at one time. So experiences for everybody. 

But yeah, and I know Shane was just in Souda Bay, Greece. Shane's my son. I know the products he's going to have, now an Active Duty Checking, Free Active Duty Checking. And the security, Navy Federal's record with security is great. And you can look those things up. I tell people to look up our record in those three areas, and I'm really proud of it. 

And thank you for serving. And also, thank you to your son for serving. Our members do very important things. And while they're deployed, it's really important that their families are taking care of at home as well. And that includes finances. 

And I was a Navy brat. I actually opened up my Navy Federal account when I was living in Yokosuka, Japan. So that was really fun living on base, running around with my little Navy Federal debit card. 

- Nice. 

- Not even knowing what to do, but no. But I think it's just that point of taking care of the service members, but also them knowing that their families are taking care of at home, their finances are taken care of. They have that sense of security. They'll have access to their money. 

Like you said, they don't have to be worrying about the safety and security of their money because we have, I mean, so many great features that really keep you in contact with what's going on with your finances and your account. And another thing that I wanted to mention is that, we just surpassed 14 million members. And not all of those members are in the military or active duty. However, our mission stays the same, and everything that we do is catering towards that mission of serving the military and their families. And that's something that I think is really great and that everyone should be proud of. 

- You know, Emily. I think as I travel around, I realize that a lot of people who are eligible for membership don't know they're eligible for membership. As a matter of fact, I ran into somebody who said, look, I'm really proud of my grandpa, but he's passed away. Am I still eligible? 

And I was telling him, because he's passed away, that doesn't diminish his service. He still served, and there's still a record of him serving. So yeah, for their grandparents, their parents, brothers and sisters. Look into our eligibility and see. You might be surprised when you're looking at those commercials, that may be who's eligible. 

- Yeah, absolutely. And going back to the unique population at Navy Federal, so how do you connect with your members and better serve them, from the high level strategic view? But also, Clay, I know you're in the day to day. So Mehdi, if you can talk about how, we as an organization, connect with our members? 

- Yeah, absolutely. I would say through different lenses. But I think one is the communities we serve. We have a strong branch presence in military and veteran communities. And so I think that's a very strong way on how we connect with our members. Another thing, a big thing, I believe, and Clay is a testament to that, is our workforce. 

We have more than 20,000 employees and many of them have served or are currently serving. Also, this is something that many people may not know, but we also have military spouses who are within our branches. And they are supporting those communities and creating those real life connections. 

And that takes us all back to everything we do, from a product, services, all of the enhancements, all of the things that we offer to our members is through all of these connections that I talked about. And when we build products, I think we have a pretty large suite of products that we offer to our military members through different discounts, like our Active Duty Checking or other things that we have to offer them. But yeah, I think we're really, really closely connected to our members. 

- Has that been your experience, Clay, that even though we have so many family members, do you feel like the active duty focus is still really strong, like when you're going from branch to branch? 

- Well, it is. But it's just a different connection. You find you can say veteran, but when you say veteran, a person who got out after four years as an army infantryman is much different than-- our president was as a flag Admiral and a submarine captain. So you're going to engage them differently. 

But what I've found is to a person, the pride-- and I can hear it in you saying. You're talking about going around as a Navy brat in Japan. That's part of your story. And I think that I've learned to engage them differently personally. 

But just it seems like they all have the same pride of having served or having their family members served. And I think we appreciate that very well at Navy Federal. But I absolutely love engaging them, especially the ones lately are coming back from a deployment and want to talk about our VA loans. 

And I'm like, OK, so you're talking about starting a family now, and you realize that that's 0 down. And you can put that closing payment into your mortgage. And just to see their lights light up and bring them through what I call their financial journey, I think we engage them appropriately, but differently throughout that whole journey. And I just love doing it. 

- Yeah the product life cycle, it's like the financial education piece is also something that I think, separates credit unions from banks, is that personalized financial education. So you mentioned that your son had a secured card. So that's helping him build credit. And then he will automatically graduate to an unsecured credit card, based on all the good behaviors that he's learning with this. 

- That's exactly right or not. That's education. And a lot of people don't realize how deeply we're into financial education. 

For 29 years, if you include the Naval Academy, I didn't realize that we had free financial counseling at Navy Federal. I've since taken advantage of it. And I preach it wherever I go for members to take advantage of that. But things like the MakingCents podcast, there's all sorts of things that we put out there. And we're constantly on our website, just constantly engaging our members because we want them to be financially healthy. 

I mean, before Shane deployed, he was home in Pensacola with his sister. And they went to their stockings for Christmas. And they said, Daddy, what's a CD? Because we have that. And I said oh, these are good ones. Let's have a little financial discussion on Christmas morning. 

But yeah, he's got that. We're cheering at 12 months. That's fantastic. I think, we used to be in savings and membership. And I saw how they just constantly are reaching out to members about what we can offer them financially. 

- And the simplicity, the simplicity of the offers and the products that we have. There's no gimmicks. Today, we actually just launched our new Cash Rewards card. It's a 2% flat. It's simple, there's no fees. And it's just really exciting. 

We had a little party today to celebrate. All the branches have all agreed. And I think that's the best part is that it's just simple. It's just it is what it is. 

And the VA loan, 100% financing. We also have 100% financing available for our members who are not veterans. So we really do take care of everybody who's in our membership. And yeah, I just I think it's great. So Mehdi, what other services do we offer for our membership? 

- So I think something that not many banks offer these days, or financial institutions, is a 24/7 contact center operations. And because we are worldwide, because we serve people who are serving in different places in the world, they have a need to contact us. And sometimes they're not on the East Coast or the West Coast. 

But they're overseas. And having that 24/7 contact center operations, I think, is very critical to that member service. And it's something that differentiates us for sure. 

Speaking of convenience and being able to reach us and being able to conduct financial activities easily is our award-winning mobile application. Those of you had a chance to use it, it's phenomenal. I use it every day, personally. That's how I pay my bills. That's how I keep in touch of my finances. 

And now that my daughter is 14, she also has access to the mobile app. And I'm able to track where she is and what she spends her money on. So that's a little fun part. 

But yeah, we talked about our branch presence worldwide. Other services, I think Clay referred to our financial presentations. And he's really good at those. I've sat through some of them. He's a pro. And so we have a lot of services that we offer, not only for the military members, but for our members overall. 

- So Clay, I was just going to say, so in the financial education workshops, is there like a number one financial question that's on everyone's mind that you find yourself constantly answering? 

- Yes, actually, how do I get out of debt? A lot of people, especially young people, discover they can get a credit card. And then they run up a debt. 

And I like to tell them, look, guys-- and it's good that I have children because I speak to them like they're my family. And I say, we can do this. It's just math. It's just a number. And you may have to make some lifestyle adjustments. 

We're going to have to get out that spreadsheet. It's not going to be real exciting. But we can get you out of debt. And moreover, we can get you on a way to financial wellness as well. 

So let's not just think of this as getting out of debt. Let's think about this as becoming financially healthy with good financial practices. And I'd say go onto our website. 

I didn't do that. Again, there's a ticker across the top that enumerates all of our products and services. On a weekend, with your significant other, you can sit down and say, oh wow, I didn't know we had six credit cards. 

Just make sure you're in the right products and services for you and your family. Because we offer so many that, you figure, I'm in what I'm in. And you just keep charging. Look at our website. I think there's some great information there. 

- That is a really-- yes, debt. I think especially now, given just the economy and the prices of everything, I think credit cards is a really good one to look at where you can say, hey, you're in this credit card. But did you know that we have a specific credit card with a low rate designed to help you if you are carrying a balance month to month? We really do create products to help people. 

And for those who have their financial house in order, we have products to get you to the next step that you want to get to and for your family. And it just feels good to bank with a credit union. So I would agree with all those points. 

And we do have a wonderful digital app. It's great to use and I love the Zelle function or feature. It makes everything easy. So is there anything else that you guys want to add, anything specific about credit unions or Navy Federal and our mission? 

- Yeah, I would like to touch back on what I said earlier about eligibility. And as I said, to become a member of a credit union, you have to meet certain criteria or requirements for the eligibility of that specific credit union. But for Navy Federal specifically, I think that there is probably still a misconception that Navy Federal is only for the Navy. 

I would use a personal example, actually. I was having dinner recently with some of my friends who are veterans. And they were Army veterans. And I asked them the question, why aren't you guys members of Navy Federal. They're like, well, it's Navy Federal. It's just for the Navy. 

And I think it's a point that we try to communicate with consumers in general and prospective members, specifically, is that Navy Federal is not only for the Navy. We serve all the armed forces. Army, Navy, Marine Corps, Air Force, as well as Space Force. On top of that, there are family members. Veterans as well as DOD civilians. 

So to Clay's point earlier, I would say, there is a really good chance that if you are looking to become a member of Navy Federal and enjoy all the benefits that we have to offer, there's a very good chance that you are eligible. So just give it a chance. 

- Yeah and we have an eligibility wizard on our website at navyfederal.org so you can just check. It's very easy to do. All you have to do is check and see if you're eligible and then and join. It's just $5 in your savings account. 

- 

Clay, one thing that we haven't touched on. We talked a lot about the military and veterans and their families. But what about when the service members are transitioning out of the military? Did you experience any sort of support from credit unions or banks, and how did that go for you? 

- So that's very difficult. I felt like I was taking my uniform off, but putting my identity in the closet. It's everything I did from the time I was 18 to 29 years later. And I transitioned to Navy Federal and realized if you're with a good financial organization like us, we partner. Actually, we partner with Hire Heroes. And they help transition veterans, get jobs. It's free. 

I did not take advantage of that. I've since worked with them and helped veterans. I personally help veterans. But it's a very difficult transition. It was for me. But yes, Navy Federal helps partner, helps teach you who is out there to partner with. 

I think I used DAV, the Disabled American Veterans, and I learned all that through the partnerships I found at Navy Federal. So again, it's that continuum I talk about throughout the life of, you're born into a military family. Or you join the military, and that's when you're born at Navy Federal. 

And then you go through, and you're right. So we serve that active duty member one way. And then he or she maybe gets married and has a family. 

Now, we have different checking accounts with joint owners. And we have, how about a house? We're going to buy a house next. And then transitioning out, they're going to want education about hey, you don't have health care anymore. You don't have housing anymore. And we help with that. 

And then even into the retired community. My father wasn't a member. And I got out of the Marine Corps. And I started. I said-- I couldn't believe it. I said, dad, who are you banking with? 

I said, look, you need to-- so he came to our website in his early 80s and he said he couldn't-- he said, I have access to all of your products and services by just putting that $5 in an account? Yes, sir. 

And it doesn't affect my credit score or anything? No, sir. So yeah, now he's a proud member. He likes our Jumbo Money Market Account. And he just survived the hurricane down in Florida. So he's doing great. 

- Wow. 

- Yeah, it's throughout-- I'm glad you brought that up. Not only are we talking about credit unions and the difference between credit unions and banks, and why, if your military, veterans and families, you need to be with us. But the fact that we take care of the member throughout their entire financial life, because they're going to need different needs. And look, we're your family. We know what those needs are going to be because people came before us and have had those needs like you did in Japan, as a little girl, like I did roaming around the continent of Africa when I was in the Marine Corps. 

And that I really feel like that is the credit union difference. You're not going to have that sort of personal support at another financial institution. And I don't think that it will necessarily carry over to multiple generations, a financial institution. But a credit union certainly can, especially Navy Federal. 

And as employees, we really take our time to get to know the members and truly try to do what is in the best interest. That's always the guiding light. Well, is there anything else that you guys would like to say? 

This has been a really great conversation. It really warms my heart to talk about credit unions and the communities and helping active duty and of course, your son being overseas. I hope that everything goes well with him and prayers for him. But any last words? 

- I appreciate y'all invite me on. I really enjoy talking about this subject. And I think we covered it pretty well. 

- Same here. Thank you for having us. It's an exciting topic, as you said. 

- Yeah, of course. Anytime. 

ANNOUNCER: Navy Federal Credit union is federally insured by the National Credit Union Administration. This podcast is intended to provide general information and shouldn't be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial professional for specific information on how certain laws may apply to your individual financial situation. References to and participation with the military community does not constitute organizational endorsement Navy Federal is an equal housing lender Navy Federal Credit Union, OUR members of the mission. 

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