“We needed to do something big — a ‘Big Wow’ — a special
contribution to benefit our community — not just for today, but for the next 65
years,” he said.
Newberry had been talking with the Huntsville Library Foundation
about its fund drive to build three new library branches. He realized it was
the perfect opportunity to donate some of the earnings from the credit union’s
new charitable donation account (CDA).
A few months later, Newberry announced a $2.5 million donation to
help build the three new branches at a news conference held at the Huntsville
Madison Public Library. With $1 million from the charitable donation account as
the seed money, the credit union plans to donate the remaining $1.5 million
over the next five years. You can learn more about the significant impact of
this donation on the community in this video of Michelda Johnson, Capital
Campaign Consultant at Huntsville-Madison County Public Library.
In the past, when the credit union made charitable contributions,
the funds came from its net income. But Newberry wanted to find a way to plan
and structure Redstone's commitment to giving. He wanted to invest available
funds for future charitable gifts in investments that are not typically
available for credit unions. That’s when he began to look into investing in a
CDA.
With a 39 percent increase in CDA investments in the past year
alone, credit unions seem to be seeing the value in this new program. CDAs
allow federal credit unions to take advantage of an expanded universe of
investments. The accounts can potentially help them increase charitable giving
and create additional operating income for the credit unions who use them.
These investments provide the potential for returns higher than traditional
investments available to credit unions, although they come with additional
risk.
Newberry and the Redstone FCU staff did their due diligence
investigating CDAs, including checking with other credit unions that were
already using them and researching vendors. The credit union chose CUNA Mutual
Group for one main reason: trust. “They always keep us in compliance. They
always keep it very simple. And, they’re always willing to come in and talk to
our community members and board members,” Newberry said.
Want to learn more about CDAs? You can learn more about them on
our website right here!
Scott Albraccio is an Executive Benefits Sales Manager with CUNA
Mutual Group. He can be reached at scott.albraccio@cunamutual.com or
800.356.2644, ext. 665.8576.
i NCUA 5300 Call Report, 12/31/16.
Proprietary insurance is underwritten by CMFG
Life Insurance Company. Proprietary and brokered insurance is sold by CUNA
Mutual Insurance Agency, Inc., a wholly owned subsidiary. This insurance is not
a deposit and is not federally insured or guaranteed by your credit union. CUNA
Mutual Group is the marketing name for CUNA Mutual Holding Company, a mutual
insurance holding company, and its subsidiaries. Representatives are registered
through, and securities are sold through, CUNA Brokerage Services, Inc. (CBSI),
member FINRA/SIPC, 2000 Heritage Way, Waverly IA 50677, toll-free 866.512.6109.
Insurance and annuity products are sold through CMFG Life Insurance Company.
Non-deposit investment products are not federally insured, involve investment
risk, may lose value and are not obligations of or guaranteed by the credit
union.
EXBEN-1797197.1-0517-0619 © CUNA Mutual Group,
2017 All Rights Reserved.
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