TAMPA, Fla.-Suncoast Schools Federal Credit Union members have access to something that is quite unique within the credit union industry: Trust services are available to them through Suncoast's credit union service organization, Members Trust Company.
At a time when financial habits are changing and estate funds are shifting as World War II era parents begin handing assets to "Baby Boomer" sons and daughters, it is a service that more and more people are seeking, said Tom Walker, chief operations officer at Suncoast Schools FCU.
"In the next 20 years, it's been predicted that $10 trillion will pass from the WW II generation to Baby Boomers," Walker said. "And when you make that transfer, it's going to require a lot of legal advice, a lot of special management and a lot of estate planning.
"Any time that much shift in wealth occurs, it will impact credit unions big time," Walker predicts. "There will be millions of dollars in credit union accounts that will change hands. And there's two things that are going to have to happen. Number one, it's going to have to be an orderly transition, which is called estate planning.
"And then once that transfer occurs, the people receiving those funds will be investors and they will not be savers. So those funds will flow out of credit union savings accounts into investment or management accounts," he predicted.
While many credit unions already offer investment planning or management, most have not yet begun to think about fiduciary services for estate planning, in which they would have the ability to act as trustee for a continuing trust for the next generation.
"And that is what our credit union's mission or focus is or will be," Walker said.
To help members learn more about these services, Suncoast Schools staff annually conducts about 10 estate planning seminars, sends out brochures and puts stories into its newsletter.
"And we also try to increase the awareness of our service center managers about estate planning, so they can make referrals to us," Walker said.
Suncoast Schools, which Walker said was the first in the nation to get into trust services 13 years ago, did it for several reasons. Suncoast Schools serves teachers, widows, and children who had lost parents. They often need help from their financial institution managing estates.
Another important reason pertains to "relationship management" with members.
"Without trust services... credit unions will have to send members to banks for estate planning. If you don't mind doing that and losing that relationship with that member, then credit unions don't need these services," Walker said. "But if you want to keep that member and provide them the services they need to manage their financial affairs, then you have to have trust services."
Walker wrote a book last year titled "Trust Services for Credit Unions," available through the Credit Union Executive Society (CUES). This book would give FCU staff interested in this service a place to begin researching how to get into it, Walker said. -
lide@cutimes.com
