New Generation of Savers

[AUDIO LOGO] BRANDI GOMEZ: Hi. Welcome to our podcast, MakingCents, sense brought to you by Navy Federal Credit Union. I'm one of your hosts, Brandi Gomez. And I'll be taking your questions to the experts to help you make sense of your money-- pun intended. 

 

Hi, and welcome to the MakingCents podcast, where today, we're going to be diving into the topic of the new generation of savers. We all know it's never too young to start thinking about your finances. And what better way to do that than to start having these conversations with your children? And hopefully, we will form those great habits as they walk into adulthood. 

 

So today, with us we have the expert CJ Pointkowski, who's the assistant vice president of savings products operations at Navy Federal Credit Union. Welcome, CJ. We're happy to have you. 

 

CJ POINTKOWSKI: Brandi, thanks so much for having me. Hi, everyone. As Brandi mentioned, my name is CJ Pointkowski. I'm assistant vice president of savings products operations. I've been with Navy Federal Credit Union for 12 years now. Almost the entire time has been spent in the savings products division. So as you can imagine, this is a topic I love talking about. And I can't wait to get started. 

 

BRANDI GOMEZ: Awesome. And to kick things off, it's also timely for us to mention Month of the Military Child. We spend extra time educating our members about these types of topics and what all parents, grandparents, guardians can think about when it comes to educating our kids and making sure they make those smart decisions for their piggy bank and, hopefully, their wallets long-term. 

 

I'm going to read a story from one of our members that's called, "Military Brat Spends Life Savings on Grand Gift for Deployed Dad." 

 

"In most families, parents take their kids on vacation, not the other way around. But the Bosworths aren't most families. And 15-year-old Matthew is no ordinary kid. A few years ago, Matthew surprised his dad Sean with a dream trip to a world class destination the Grand Canyon he announced the trip the night Sean, an aircraft technician in the US Navy, returned home from a 10-month deployment to India. 

 

"When he presented his plan, I brushed him off like, yeah, dude, you're funny," Sean recalled. And then he showed me that he was serious. He definitely caught me off guard in the best way. 

 

Matthew's generous gift was years in the making. He hatched the plan at age 11 when he learned of his dad's upcoming deployment. Two months before Sean left, Matthew opened a 12-month certificate of deposit with Navy Federal Credit Union, a high-return, low-risk savings account. He timed its maturity date to his dad's eventual return so the pair could take the trip soon after Sean's homecoming. 

 

While Sean was away, Matthew saved every cent he could-- birthday money, holiday gifts, cash from yardwork and other odd jobs. Everything the tween earned went into his savings account. In the meantime, Matthew studied the driving route and researched hotels near the famed National Park, reviewed restaurants, and explored activities. 

 

By the time Sean returned home, Matthew had socked away $1,100, enough for several nights at hotels, a trip to an antique car museum along the way, and plenty of souvenirs. Tickets to the National Park are free for military families, and Matthew's mom assured him she would cover meals and other expenses. 

 

A few days later, Matthew and Sean headed out from their home in Washington State, stopping at points of interest on the nearly 24-hour drive to the immense River Valley in Colorado Plateau. The pair enjoyed two full days in the park before heading back home. Matthew's favorite part was hiking out to a rock that jutted out from a ledge of the canyon. Sean's was evening conversations with his son. 

 

He said, "We had a blast the entire time. But when the sun was setting over the canyon, we just sat and talked. And it was so nice." 

 

Wow. I think about that, CJ, and I know myself at the young age of 15 certainly didn't have the mindset of Matthew. So what is your reaction to hearing that story? 

 

CJ POINTKOWSKI: Yeah. Yeah, Brandi. So at our job, we have good days, right? And then sometimes we have great days. And when you hear a story like this-- and I've talked about this story at least a half dozen times with different employees and different teammates around the credit union-- these are great days. You have a younger member who is thinking about his relationship with his father, thinking about his family, wants to do something special, and in some way, shape, or form, Navy Federal Credit Union gets to be involved in that. 

 

And so that, when these stories make their way across our desks and into our team meetings, those good days turn into great days really quickly. 

 

BRANDI GOMEZ: Right. And such a special memory. I am the mom of two young kids that are 6 and 4. And so I can only hope that they build these types of habits early on, because I sure would love to go on a trip like Matt and Sean did. Tell me a little bit, CJ. Where do these smart money habits happen? Where do they start? 

 

CJ POINTKOWSKI: So where they start is at home, right? They start at home. And it's in situations like these. Sometimes there are really typical timelines that everyone follows. And I think we can talk about that a little bit more because I've got two boys at home and they are 15 and a half years old and 13 years old. And so they're kind of in that same age range that Matthew's in. 

 

But then, sometimes there's unique situations. And that's when we also have products and services to help out with those cases and with those members who are looking for something that isn't on the typical timeline. But I think one of the cool things that we do at Navy Federal is, so often, people think about adults and their financial journey and the timelines that they go along and the products and services that they might be in the market for. 

 

We place such an emphasis on our younger members, on that next generation of savers, because we have great products and services for them as well. And it is, it's a different journey that they are going on. And so I love the idea of focusing on our younger members, not just in the month of April when there are all these different events geared towards our military kids and our military children, but throughout the year, to be there whenever they need something, and for us to actually take time to help promote thrift, establish some strong financial habits and financial awareness. And so this story hits right home with my kids and what they're going through right now. 

 

BRANDI GOMEZ: Absolutely. And I feel like there's simple things that you can do even as that parent, grandparent, guardian to set them up for success and make it exciting. Some research when getting ready for this that said, 40% of kids between the ages of 8 and 14 have a savings account, which is wild. And then when I reflect on that, I think about how my husband, he's been a member of Navy Federal since he was born. And it was important to his parents that as soon as we had our own children, we set them up that savings account, something for their name to be on it so that, by the time they're ready to buy that car, they have that established savings account. 

 

And so it's kind of turned into a generational thing for our family. Can you talk a little bit more about the importance of that savings account? 

 

CJ POINTKOWSKI: Yeah, absolutely, Brandi. And so we talked about that stat, right? 40% of kids 18 to 14 have a savings account. And my first reaction when we mentioned that was, that's awesome. How can we get that to 60%? How can how can we get that number higher, because it is such a useful tool? And it really does start almost immediately. 

 

So my wife, Jessie, and I, when we had our children, one of the first things we did-- once we got home and the dust settled-- and you could argue that the dust never settles, even 15 years later. But one of the first things we did was open up that savings account for our kids. I've heard stories similar to the story about Matthew and his dad, Sean. I've heard stories about parents, guardians, or grandparents, when a new child comes their way, they open up a savings account. And they just set an automatic contribution to go into that account each month. 

 

Or they can do it with a certificate of deposit. We have certificates here. And what those are, similar-- it's an investment vehicle. You put money in it. And it is for a set term. And we have all sorts of terms ranging from months to years to multiple years. And those give a little bit of a higher rate. And I've seen examples of parents or grandparents opening a certificate for a newborn. And each month, because we offer a number of products that allow add-ons, which we can hit on later as well, each month, some money goes into that account. 

 

And so a certificate that's opened, or a savings account that's opened with $100 or $1,000, and if you put a monthly amount in there, it's amazing how it grows over time. And the example I can share with you, the specific example I came across, was a certificate was opened with $1,000 balance when the child was born. And they put $10 a month in that certificate. Child was 18, and there are several thousand dollars sitting there when the child is 18. 

 

BRANDI GOMEZ: Wow. 

 

CJ POINTKOWSKI: And what a gift. What a gift to be able to do. Not everyone is able to do that. But I think it just sends a clear message to the child as they start to get older and start to become more aware of the importance of financial responsibility and financial savings techniques and things like that. 

 

BRANDI GOMEZ: Absolutely. And you can start small. 

 

CJ POINTKOWSKI: Sure. 

 

BRANDI GOMEZ: I even think about, we just recently bought our kids piggy banks. And how exciting-- they're always looking for change within the cars or maybe the quarters that we left in our laundry. And it's such a treat for them to be able to place that change into a piggy bank. And while we're trying to build those habits for them, it's exciting. They like to be part of that with us. 

 

So how can you, in everyday tasks in your family, whether it's grocery shopping or planning for your next trip-- how can you involve your kids in an organic way where they find savings to be part of their habits growing up? 

 

CJ POINTKOWSKI: Yeah. And it's a great question. And it's one of those things that you really have to be conscious about doing, because it really starts with involving them. And to me, Brandi, there are two directions to take. And some of these conversations are internal conversations within the family, right? The difference between needing and wanting things, upcoming events, whether you're going on a vacation or going to the shopping mall or to an amusement park, and saving money to do the things that you want to do at those things. 

 

Larger milestones-- I have a son that's 15 and a half years old. Driving a car is in his very near future. And having those conversations about, you're going to need gas money, and you're going to want to go out with your friends and pick them up and things like that. Even college-- talking and preparing for college or life after middle school and high school, things like that, internal conversations that are specific to each family and deal with different family dynamics. 

 

But then you have external conversations. And that's where we want to be involved. What products, what services, what tools, what knowledge and assistance can we, Navy Federal, be for our members and our members who have younger members? 

 

And I think, as you mentioned, just starting those conversations and saying, we are going to the grocery store. We're on a budget. Here's our budget. And here's what we need to consider. We need to be able to have breakfast, lunch, and dinner for the next seven days. And we need some snacks to be ready. And we want to have things, maybe a dessert or a treat or something here and there. So how do we fit that into our budget? 

 

And that's where we start. And I think when you mentioned earlier, it's OK to start small, I think we all start small. And that's where those experiences and lessons come from, and how they morph into knowledge and just being comfortable dealing with financial decisions. 

 

BRANDI GOMEZ: It's helping them build that thought process so that, as a young child, they think about saving that coin. And then eventually, to your point, that turns into, wait, I need to save money for gas. And so you know, let's transition a little bit to maybe you do have older children like your own. What kind of options are out there from Navy Federal? Do we have debit cards? Or, instead of savings? 

 

CJ POINTKOWSKI: Yeah. So this is what I'm going through right now. And so this is pretty cool. So our son Charlie is 15 and a half years old, freshman in high school. As I said, he had a savings account from the time he was born. And so birthday money, holiday money, things like that, we would set some aside so they'd go into his savings account, and set some aside for him to spend. 

 

Well, he's at an age now where he gets an allowance for doing chores around the house. He had to take the trash out every week. And that was a big deal when he was seven years old. Now he's older. So he can do more things around the house. But you know, I'm overbearing and overcontrolling sometimes. So when it's time for him to cut the grass, I'm staring from inside the house. I'm like on a ship looking through a porthole just making sure he does it just right and all that, because I don't want to give up that control. 

 

But we need to give him some responsibility. And so now that he's cutting the grass, he's earning a little bit more money. He's also got a real job now. He's working at a snack bar at the Little League field. So he's bringing in income there. So that savings account where we have all his money, that's not going to be quite enough for him. Now he's going to start spending some money. And he's going to be doing things with friends and things like that. And so, perfect time for us to open his first checking account, because we had to also get his paycheck deposited into an account. 

 

Lucky for us, Navy Federal has the perfect checking account for our younger members. It's Campus Checking. It's designed for members who are age 14 to 24. There are some perks that come with it-- $10 in ATM rebates each cycle period. There's no requirement other than age to open it. So it's a free, no-strings-attached account. It's perfect for him. 

 

With his Campus Checking Account, Charlie got access to a debit card. Comes with an account. Debit card is safe and secure. It allows him to transact. He doesn't have to carry around a ton of cash. So it's perfect for him. And we have several products along those lines that are great for our younger members. 

 

And now, here he is, 15 and a half. He has a paycheck coming in. He has money that he can move over to a savings account. He has money he can keep in his checking account. He has a method to access his checking account funds with his debit card. He has a cell phone. This kid is 15 and a half years old. He might as well be 35 years old. He's the most independent and self-sufficient person there is. Like, he is an adult in many sense of the word. 

 

So we're watching him grow up before our eyes. But the really cool thing and why it's important to be knowledgeable about all these products and services we have is that everything he needs is there. And so he can go out there and he can be comfortable with how safe and secure his money is, how he can access it, how he can transact, and how he can, at 15 and a half years old, live his best life. 

 

BRANDI GOMEZ: Right. Which is what we all want to do. For maybe those parents that are not quite ready for their child to have full access to spending, what do we have that might be more like an allowance? Do we have cards that you can load for them? 

 

CJ POINTKOWSKI: It's perfect. We really-- we do. And we really are there for any sort of needs that our members have when dealing with their younger children and with our younger members. We have the Go Prepaid card. And the Go Prepaid card, in many ways, it acts similarly to a debit card, except it is reloadable. And you can put a certain amount of money on it. And you can control the amount of money that's on there. 

 

They can be used at ATMs. They can be used almost everywhere that accepts any sort of other cards, debit or credit cards. But there is that added layer of control to help with these financial lessons and with this budgeting and with cost control aspects of transacting out there. And so the way we looked at it, we looked at both cards. We were OK moving in the direction of the debit card. The Go Prepaid card is a perfect tool for our members to use with their kids as they're establishing those financial habits and understanding-- and I think this was a really big lesson for Charlie-- once you spend the money, it's gone. 

 

BRANDI GOMEZ: Right. 

 

CJ POINTKOWSKI: And it's not limitless. And we all wish it were. But the times we live in and the way things are now, we all have to be very mindful and careful. And budgeting is an important part of that. 

 

BRANDI GOMEZ: Definitely. Can you walk me through the process? I know I'm thinking back to when I was a new parent. And the thought of opening up a savings account for them, I didn't really quite understand how easy it was. Can you tell me what's that process? Do I have to go to a branch? What all might I need? Can I just do it online now? 

 

CJ POINTKOWSKI: Yeah, it's really easy. And yes, the answer to all your questions are yes. It's such an-- we try to make it as frictionless as possible because it is such an important first step. And really, the basic savings account that we have is your child's first step towards saving. It comes with Navy Federal membership. There are rates-- competitive rates-- on our savings accounts. And we have other products out there that offer even higher rates. 

 

The best way to-- simply put, the best way to open a savings account for your child is whatever way you want to. You can call in and talk with some of our member service representatives. And they can guide you through step by step. You can walk into a branch if you'd like to and talk in person with a member service representative. They know exactly how to do it and can help answer any questions you have. 

 

Or the easiest way, and really, the most simple way, is just going online. And you can open accounts for your children online, whether through your mobile app or through Navy Federal online banking. And so we want to make sure we offer all these different avenues for our members to get in touch with us. But we do see the majority of our new accounts are opened online. 

 

We think it's a really fast and seamless process. But there are times when we think we might have some questions. And if that's the case, we want to be able to answer those questions in person, whether it's through our contact center or in a branch. 

 

BRANDI GOMEZ: Talk about making it simple. I know I like the sound of that very much. Seems like the type of experience that I would want to have when trying to take care of my kids finances. 

 

I also-- I alluded to it earlier, but it is Month of the Military Child, where we are celebrating the unique sacrifices of military children. And Navy Federal is donating $25,000 to the nonprofit, Our Military Kids. And this nonprofit is near and dear to my heart because I do know some people that have benefited from this. But Our Military Kids focuses on those after-school activities for youth, extracurriculars like karate or ballet or cooking classes that may not be in the cards for military families who are trying to make ends meet where they're at. 

 

So I'm excited to share that we're donating. We're going to be sponsoring some of these grants for these military kids so that, while their parents are deployed, they have that little bit of joy in their lives. So, very excited to be able to share that. 

 

And CJ, this has been really helpful for me. I know I've taken some nuggets that I plan to go talk to my own husband about that we need to be doing for our kids. But is there anything else that you feel like we missed today, you want to share? 

 

CJ POINTKOWSKI: No. Thank, Brandi, for the opportunity. Like I said, I love talking about this. And this time of year is always so important for our younger members. We do highlight this time on the calendar to recognize and celebrate our military children. 

 

One more thing-- in addition to a Month of the Military Child, April 15 is Purple Up Day. And so everyone-- we encourage everyone to wear purple to show their support and to thank our military children for their strengths, for their sacrifices, because honestly, we get a lot of inspiration from them. We hear the stories like we talked about at the very beginning here. And we see them in action. And it really does inspire us to continue to offer these products, these services, but also go the extra mile to increase their awareness and their knowledge and comfort with these financial topics. So our military kids are-- that's something we can all rally around and remain near and dear to our heart. 

 

I appreciate the time. Thanks for letting me talk about it. And as I mentioned, any questions, we are happy to answer them. You can look online for a ton of information on promoting fiscal responsibility, helping with financial lessons and knowledge and comfort, and really, just promoting thrift and helping our members get to where they want to be, them and their families. It's something that we take very seriously. We look forward to continuing to work with our members and help our members at every step of the way. 

 

BRANDI GOMEZ: Thank you so much, CJ. So thank you all for listening. As you heard it, the earlier we can start building these financial habits for our children, the easier it will be for them to lead to financial success down the line. And for any of you that grew up as military children, or maybe you're raising some incredibly brave military children, thank you for all that you do in going above and beyond for us. We appreciate you. 

 

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ANNOUNCER: Navy Federal Credit Union is federally insured by the National Credit Union Administration. This podcast is intended to provide general information and shouldn't be considered legal, tax, or financial advice. It's always a good idea to consult a tax or financial professional for specific information on how certain laws may apply to your individual financial situation. References to and participation with the military community does not constitute organizational endorsement. Navy Federal is an equal housing lender. Navy Federal Credit Union-- our members are the mission. 

 

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