NEW YORK – For the National Federation of Community Development Credit Unions (NFCDCU) the October 18 celebration of Financial Literacy Day represented far more than a nod to a perennial credit union goal. It gave the Federation the opportunity to celebrate where it has been and to highlight many of the innovative efforts community development credit unions have begun to make, according to Federation executive director Clifford Rosenthal. The location for the Federation's celebration, which the City of New York recognized with a declaration, embodied many of the themes the Federation wanted to highlight, Rosenthal said. Union Settlement FCU, the $8.1 million community development credit union (CDCU) that hosted the event, helped found the National Federation and has served the residents of East Harlem, a predominantly lower income area, since 1957. Originally founded as an association based credit union, Union Settlement originally served the association members of the Union Settlement Association, but has since broadened its field of membership to an area stretching from 90th street in the south to 125th street in the North. "This is a credit union with some very strong working class roots," Rosenthal said, pointing out that one of the credit union's founders in the early years had worked as a janitor in the settlement property when he wasn't helping to get the financial institution going. Union Settlement FCU is still located in the Union Settlement building on East 104th street, where it occupies about 500 square feet, Rosenthal estimated, and where it remains firmly linked to the organization's broad community development mission. During the course of the Financial Literacy day event, dignitaries and visitors, which included NCUA Board Member Deborah Matz, observed financial literacy classes that the credit union offers through its sponsoring organization's classrooms, as well as Head Start classes where many members of its field of membership send their toddlers. They also toured the community development gardens adjoining the Settlement buildings, gardens that used to be junkyards filled with old tires and rusting cars, Rosenthal said. The credit union's effort and involvement in ongoing community development effort provided the theme for the day, which saw speakers highlighting the role credit unions can play in helping these ongoing efforts. Joy Cousminer, CEO of the $9.6 million Bronx based Bethex Federal Credit Union, used the occasion to remind the audience that financial education and good financial practices are not just the province of the low income. "Middle-income people don't manage their money any better than low-income people," she said. "Most of them don't budget, have too many credit cards, don't know what they owe, don't balance their checkbook. I could go on and on," she added. To illustrate she asked her listeners a question: "How many of you here balance your checkbooks? Most people I ask say, `I just put in extra money, so I don't have to think about it.' The problem poor people have is they don't have enough money to put in extra. The increasing number of bankruptcies each year more often occurs among middle-class people with large numbers of credit cards," she said. Cousminer contended that these realities mean that financial literacy has to begin in kindergarten and to continue over the course of an educational career in order to make sure it becomes a routinely recognized skill. She also pointed out that credit unions are largely failing to meet their members' financial education needs. "Members . still can't, write a check or balance their checkbook," she noted. "Members frequently carry around an ATM card that they can't use. Many members can't read their statements and ask what happened to their money. Most members on the long line that reaches out into the street on the 1st and the 3rd of the month have ATM cards, and there is an ATM in the lobby. Most members who have checking accounts still buy money orders. Most members don't understand interest rates, and automatically say, `Wow! That's high,' no matter what rate you quote." "We don't want to wind up saying people are poor because they don't know how to manage their money," she cautioned. Part of the answer to the ongoing need for broad financial education that Cousminer outlined came in the form of the partnerships that the Federation has initiated with three other organizations, Rosenthal noted. The Federation has entered into a partnership with Community Food Resource Center (CFRC), a Manhattan based anti-poverty organization which has focused on helping more lower income people access the federal earned income tax credit for which, it contends, far too many fail to apply. In 2003, under the partnership, the Federation will bring representatives of member CDCUs to sites the CFRC will set up to help lower income people process their tax returns for the tax credit. Those who are not already credit union members can apply to become members and will be able to access loans based on their tax refunds at much lower cost than they could access them from tax professionals. "In many cases the big tax preparation places like H.R. Block often charge very high fees to people who are only getting their money two or three weeks in advance," Rosenthal noted. The Federation is also partnering with an organization called the One Economy Corporation. One Economy uses a comprehensive Web site to provide the most basic levels of financial education to users, a growing number of whom will be CDCU members, Rosenthal hoped. "We are talking the most basic levels of education," he said. "How to write a check, for example. How to read a checking account statement." Or course in order to access an education offered through the World Wide Web you have to have a computer and that is why the Federation has also agreed to help provide financing to people who wish to buy the computers offered by the Per Scholas organization. Based in the Bronx, Per Scholas takes computers donated by corporations that are widely considered to be "old technology" and refurbishes them so they can be sold to, and used by, lower-income people to help in their kids education or use the Internet. Many of the machines, which have Pentium II microprocessors, can cost as little as $300, Rosenthal noted. "Think of what a difference in access it is to be able to buy a computer you need for $300 rather than $1,500," Rosenthal noted. "Sure, it's not the cutting edge of technology but the machines work well and they are within reach of many people for whom they are currently impossible to have." The Federation will help its member CDCU's finance those machines for their members, he said. [email protected]