Carrying a credit card balance is costly--particularly for members who make only the minimum monthly payment. The Federal Reserve Board's online Credit Card Repayment Calculator will allow members to estimate how long it will take to pay their credit card bills under different payment scenarios. "By identifying the true cost of credit, this new tool can help credit union members devise a plan to manage the cost of carrying a credit card balance," said Federal Reserve Board Governor Elizabeth A. Duke. The median balance on credit cards, as reported in the Federal Reserve Board's 2007 Survey of Consumer Finances, is $3,000. The average interest rate on cards that carry a balance is 13 percent. Using the calculator, credit union members will find that paying off a $3,000 balance at an interest rate of 13 percent could take as long as 16 years and cost $2,812 in interest if they only make the minimum payment each month.
The calculator can be accessed at http://www.federalreserve.gov/creditcardcalculator/ and is one of several resources the Board provides to help credit union members make informed decisions when shopping for credit cards. Not only can credit union members use the calculator to estimate how long it will take to pay off their credit card bills if they only make minimum payments, they can also estimate the monthly payments needed to pay off a balance in a specific number of years or the amount of time it will take to pay off their balance if they pay a specific amount each month.
Creditors that are depository institutions having assets of $250 million or less may use these toll-free numbers to comply with the Federal Reserve Board's recent amendments to Regulation Z, which will require creditors to disclose on the periodic statement a toll-free telephone number that consumers may call to obtain an estimate of the time it would take to repay their account balance. This disclosure becomes mandatory on July 1, 2010. These creditors may also disclose, at their option, the Federal Reserve Board website addresses noted above. For additional information, see the Federal Reserve Board's Final Rule Amending Regulation Z (499 KB PDF).
How Your Accounts Are Federally Insured
The National Credit Union Administration (NCUA) is the federal agency that administers the National Credit Union Share Insurance Fund (NCUSIF). The NCUSIF, like the FDIC’s Deposit Insurance Fund, is a federal insurance fund backed by the full faith and credit of the U.S. Government.
The NCUSIF insures member savings in federally insured credit unions, which account for approximately 98 percent of all credit unions. All federal credit unions and the vast majority of state-chartered credit unions are covered by NCUSIF insurance protection.
Credit unions that are insured by NCUSIF must prominently display the official NCUA insurance sign. No credit union may terminate its federal insurance without first notifying its members.
Here are some important facts to remember about your share insurance provided by the NCUSIF:
Not one penny of insured savings has ever been lost by a member of a federally insured credit union.
As a member of a federally insured credit union, you do not pay directly for your share insurance protection. Your credit union places a deposit into the NCUSIF and pays an insurance assessment based on the total amount of insured shares and deposits in the credit union. Federally insured credit unions are required to deposit and maintain one percent of their insured shares and deposits in the NCUSIF.
Most share accounts in federally insured credit unions are insured up to the Standard Maximum Share Insurance Amount (SMSIA), $250,000 as of October 2008, which may increase in the future. 2006 legislation increased the insurance coverage on certain retirement accounts, such as IRAs and Keoghs, up to $250,000. Generally, if a credit union member has more than one account in the same credit union, those accounts are added together and insured in the aggregate.
There are exceptions. You may obtain additional separate coverage on multiple accounts, but only if you have different ownership interests or rights in different types of accounts and you properly complete account forms and applications. For example, if you have a regular share account and an Individual Retirement Account (IRA) at the same credit union, the regular share account is insured up to $250,000 and the IRA is separately insured up to $250,000. However, if you have a regular share account, a share certificate, and a share draft account, all in your own name, you will not have additional coverage. Those accounts will be added together and insured up to $250,000 as your individual account. Additionally, shares denominated in foreign currencies are insured as outlined in NCUA Rules and Regulations.
Coverdell Education Saving Accounts, formerly education IRAs, are insured as irrevocable trust accounts and will be added to a member’s other irrevocable trust accounts and insured up to the SMSIA. Roth IRAs will be added together with traditional IRAs and insured up to $250,000.
Additional coverage is available on revocable trust or payable on death accounts on a per beneficiary basis. You can now name a parent or sibling as a beneficiary to get separate coverage. Previously, beneficiaries had to be a spouse, child or grandchild. The rules on joint accounts have been simplified. A co-owner’s interest in all joint accounts in the same credit union will be added together and insured up to the SMSIA.
The federal insurance fund has several programs to help insured credit unions which may be experiencing problems. Liquidations or failures are a last resort. If a federally insured credit union does fail; however, the NCUSIF will make any necessary payouts to the credit union’s members. These payouts are usually done within 3 days from the time the credit union closes its doors.
How Your Accounts Are Federally Insured 
