By now, you’ve seen it all over the news, there’s commentary online, and there are opinion pieces EVERYWHERE to tell you exactly how you should feel about the two big bank failures last week. For a lot of us, the more information we get, the less it all makes sense and the scarier it seems, right?
As your friendly neighborhood credit union, we try to steer pretty clear of commenting on our For-Profit cousins in the financial industry, but this seems like exactly the right time to offer a little peace of mind and talk about why we’re different.
For starters, if you’d like to learn more about what happened with these two banks, check out
“What Happened with Silicon Valley Bank” by The Wall Street Journal.
If you’d rather skip the extra reading (or hit a paywall on the WSJ site), the explanation, in a nutshell, is that financial institutions of all kinds invest money as a way to increase their bottom line. For a For-Profit Bank, the need to pass a profit along to their shareholders PLUS sustain and grow the business often steers them in the direction of riskier investments that, if successful, would mean a higher reward. And sometimes, those investments don’t pan out.
So, why do we think you shouldn’t worry?
As a member of a not-for-profit cooperative financial like Simplicity CU, the majority of the money you save with us is invested back into your friends and neighbors in the form of loans for homes, cars, tractors, or whatever they need to live a great life right here in the middle of the Dairy State. And while we invest some funds to help us ensure we can keep lending money and offer you competitive rates, those investments have to meet strict (and conservative) guidelines designed to ensure we’re keeping the whole Credit Union Industry strong for years to come.
Hey Friend, it’s always smart to plan carefully when it’s your savings we’re talking about. Fortunately for credit union members, your deposits are insured up to $250,000 by the National Credit Union Administration (NCUA). And here’s a fun (and reassuring) fact: Because of that NCUA backing, no credit union member has ever lost a single penny of insured savings.
Isn’t that good to know?
If you want to learn more about share insurance, skip over to MyCreditUnion.gov and don’t miss their handy insurance estimator.
And, hey, if you EVER hear financial news out in the world that makes you feel a little stressed, we’re here for you. Just call, stop in, or check out our blog for financial info you can use!