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Building Savings-Per-Member at Credit Unions

This study evaluates how credit unions can increase savings per member by attracting more funds from households with more than $25,000 in liquid assets.

  • Jinkook Lee PhD, Professor of Consumer Science and Research Associate at the Center for Human Resources Research at Ohio State University
  • William Kelly Center for Credit Union Research at University of Wisconsin-Madison

Executive Summary

Building savings per member can reduce operating costs per dollar of assets. Credit unions can build savings per member by marketing to target household segments. One such segment is households with significant liquid assets, defined as combined savings in credit unions, banks/S&L’s, and money market mutual funds (MMMF).

What is the research about?

To support divide their findings, the researchers divided U.S. households into three groups: 

  • "Regular Savers" with less than $25,000 in liquid assets
  •  “High Savers” with $25,000—$50,000 in liquid assets
  • “Top Savers” with over $50,000 in liquid assets

They analyzed the financial and demographic characteristics of these groups and found that many of these households fall into the broad range of middle income households, which have accumulated savings over a long period of time. They then used the analysis of group characteristics to develop marketing implications for credit unions that wish to build savings per member by attracting additional funds from these groups.

What are the credit union implications?

Though some marketing strategies for Regular and Top Savers are also effective for High Savers, credit unions should recognize differences between the three groups. Most important, credit union strategies should go beyond using pricing and should be localized. This report suggests approaches for developing such strategies.