Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

CU System
CUNA Mutual exec outlines prefunding benefits
NEPTUNE, N.J. (1/6/10)--CUNA Mutual Group Executive Benefits Specialist Mike Downey covered an emerging concept--credit unions prefunding benefits--at Monday’s Monmouth/Ocean County credit union chapter meeting in Neptune, N.J. With credit union health care costs increasing by 20% on average, some credit unions are using prefunding benefits to help mitigate costs, Downey said, according to the New Jersey Credit Union League (The Daily Exchange Jan 5). “It’s not a program to reduce benefit costs, but rather get higher investment yields to offset rising costs,” Downey added. Prefunding benefits is covered under National Credit Union Administration (NCUA) Reg. 701.19 with clarification letters in February 2004 and December 2006. CUNA Mutual had an ongoing dialogue with NCUA on what investments are permissible for prefunding of benefits, Downey noted. Credit unions can fund benefit obligations using normally non-permissible investment vehicles, Downey said. Prefunding is a long-term investment strategy. The earnings from the investments can offset costs of underlying benefits. One New Jersey credit union prefunds benefits, as do about 12 on the East Coast. The concept is still new to most credit unions, Downey said.
Other Resources

RSS print
News Now LiveWire
@AdamMertzCUNA @CUNACraig @AnnHPeterson @CUEscan @cumagazine
4 hours ago
.@TheNCUA :Low-income CUs can expand services to members, train staff,collaborate for efficiencies w/more than $1M in grants awarded 2day
14 hours ago
.@CUNA joins 11 other financial service orgs urging @SenateFloor to take up #CISA to strengthen cybersecurity information sharing
15 hours ago
.@RedwoodCU and its staff donated a combined $5,100 toward AIDS Walk San Francisco. The CU is a longtime sponsor of the event.
15 hours ago
See the latest from @CUNA's CompBlog on Customer Due Diligence. http://t.co/rzOzDUpNMT
16 hours ago