The Wall Street Journal blog, Real Time Economics, recently featured a post entitled, "Will 2009 Be Year of Saving?". The article gave a preview on the economic outlook for 2009 as it relates to the earning, spending and saving outlook for consumers. It observes that unemployment threats, wage and benefits decreases do not bode well for workers. The Obama stimulus package is targeting this reality by planning infusions which are designed to create jobs. It is clear from holiday spending reports that consumers have cut down on spending. This is a threat to the national economy but has had the side effect of reducing the cost of goods. In addition, a big relief to individual families has been the reduction of gasoline and fuel prices. The post observes that:
"Gasoline prices are down about $2 per gallon since the peak in July. Joseph LaVorgna of Deutsche Bank estimates that every $1 drop in gasoline adds about $100 billion to household cash flow — meaning households have an extra $200 billion to spend on items besides gasoline. That amount is bigger than the rebate checks sent out earlier in 2008."
Fuel prices have also decreased adding more expendable income to the pockets of families. The blog observes that in spite of the tight economy American families have not lost their ability to look forward. They have internalized the message urging them to save for reirement.
"A survey by the Investment Company Institute in October showed that despite market volatility, investors remain committed to saving for retirement. Only 3% of participants have stopped making contributions this year."
The UFirst Board of Directors took action at our December 16th board meeting to make it even easier and more advantageous for our members to save for retirement. The Board was unanimous in our support of a new Payroll Certificate program. This UFirst product is a 12-month CD that can be opened with a minimum deposit of $20. Member participants deposit at least $20 each pay period through direct deposit or payroll deduction. The interest rate on this CD is higher than our regular savings account but lower than our normal 12-month CD.
Dividends are earned beginning with the initial $20. The CD can be rolled into another savings or CD account at the credit union at the end of the year. We feel that this is a great way to offer our membership the opportunity to save for the future. We believe by allowing the smaller deposits into this certificate will contribute to the savings goals of members.
The Payroll Certificate Program will be launched on January 1, 2009 with a full explanation and disclosure.


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