Credit Unions Help Members Survive the Government Shutdown

Dozens of big and small credit unions across the nation are stepping up efforts to financially support members who have been affected by the government shut down that began Dec. 22 and may not end anytime soon.

President Trump said Wednesday afternoon that the government will remain closed for “as long as it takes,” as the partial closure enters its 12th day on his demands for billions of dollars to build a new wall along the U.S.-Mexico border, the Associated Press reported. Congressional leaders were scheduled to meet with Trump later on Wednesday. He rejected a previous offer by Democrats to reopen the government without border wall funding.

While credit unions are offering a variety of options to help their members survive the shutdown storm, the $412 million FedChoice Federal Credit Union in Lanham, Md., is giving members a way on its Furlough Center page to vent their frustrations by encouraging them to share their stories about how they are being affected.

“My husband is active duty Coast Guard. Everyone thinks the military is getting paid during the shutdown, but the Coast Guard is facing no pay on the 1st due to being DHS and not DOD,” a FedChoice member wrote. “We live in NYC, pay over $2K/month in rent, have a toddler and one on the way.”

Another FedChoice member wrote: “My insurance premium is $600 per month & my son’s insulin & pump supplies are an additional $600 per quarter. Barely making it. Now I’ll be going to work … paid in the future.”

To help their members financially, FedChoice is waiving any early withdrawal fees or penalties for members who have socked some of their money in CDs or holiday club accounts.

In addition to skip loan payment options, credit unions such as the $1.5 billion Fort Knox Federal Credit Union in Radcliff, Ky., are offering other forms of relief. Fort Knox FCU is offering laid off federal workers, including federal contractors, personal loans with no payment due for 90 days or extending payment due dates for 30, 60 or 90 days.

Ray Springsteen, president/CEO of Fort Knox FCU, noted during the 16-day government shutdown in 2013, the credit union provided 200 emergency loans for those impacted.

“As the largest member-owned financial institution in Kentucky, we want to help hard-working Kentucky families through this shutdown as well,” he said.

The $465 million SkyOne Federal Credit Union in Hawthorne, Calif., posted a personal finance guide for federal employees that offers assistance and features comprehensive information and ideas about how they can weather the government shutdown storm.

For example, SkyOne pointed out that health benefits for furloughed federal workers continue even when premium payments are not made on time.

“Just as back pay accumulates during a furlough, your contribution to a health insurance plan will accumulate during the time you are not paid,” according to SkyOne. “Whenever you receive your next check, the appropriate amount will be deducted.”

SkyOne also pointed out that laid off federal workers are eligible for unemployment benefits in their state. While some states require a waiting period of one or more weeks before benefits begin, federal employees may have to return the unemployment compensation once they receive their back pay when the government shutdown ends.

As a credit union that has served federal employees for more than six decades, the $300 million Cabrillo Credit Union in San Diego, Calif., is offering payroll assurance loans.

Members who have signed up for a PAL will receive a 0%t line of credit equal to their regular pay or up to $5,000. PAL was designed to be repaid automatically when the payroll checks are posted when the shutdown is over.

The world’s largest cooperative, the $94 billion Navy Federal Credit Union in Vienna, Va., announced Dec. 22 that it plans to cover direct deposits for eligible members during the government shutdown. Navy Federal serves Department of Defense and Coast Guard veterans, active duty, civilian and contractor personnel, and their families.

“Our members deserve peace of mind during a government shutdown and eligible members can register to get some relief,” Tynika Wilson, Navy Federal’s SVP of debit card and fund services, said. “Public service is a defining characteristic of our membership, and this is the right thing to do.”