What exactly does the expansion of Navy Federal Credit Union to include the Army and Air Force community mean for customers?
"In the case of credit unions, it's usually good news," said Ruth Susswein, deputy director of national priorities for Consumer Action, a nonprofit consumer advocacy organization.
For one thing, there's a limit on how much credit unions can charge in interest rates — usually 18 percent.
"But we tell people to shop around to make sure it's competitive," she said, not just compared with other financial institutions, but from the perspective of the consumer's needs.
"Competition could be good for the consumer. We'll have to see what they end up competing on, such as auto loans and credit cards," Susswein said. "Overall, it sounds like a good thing."
In May, Navy Federal — the world's largest credit union — expanded its field of membership to include the Air Force and Army (in addition to Navy and Marine Corps) active-duty, retired, reserve and civilian personnel and their families.
Since then, 60 to 70 people a day from the Army and Air Force communities are becoming Navy Federal members, Navy Federal spokeswoman Jennifer Sadler said. About 2,300 have joined since May 22.
A bigger Navy Federal will be good for the military community in a number of ways, said Cutler Dawson, Navy Federal's president. For one, it means Navy Federal could offer lower rates on loans and higher rates of interest on savings products.
"You need to grow to be viable," Dawson said. "As we grow, it allows us to take advantage of economies of scale."
For example, he said, "You process loans more efficiently, and it allows you to give better rates."
Expansion also will give Navy Federal a higher profile with partner companies such as Visa, MasterCard and Geico.
"They pay more attention to you, and rightfully so, because you're reaching more people," he said.
That could result in lower rates, too, he said, noting that Navy Federal has a partnership with Geico to offer car insurance to its members.
Dawson said Navy Federal already has good rates, and it also pays interest on all its checking accounts. Navy Federal was rated as an "excellent" credit card issuer in the October 2007 issue of Consumer Reports, based on a survey of 36,000 readers.
To increase its 24-hour call center capacity, the credit union is adding to its Pensacola, Fla., complex, placing another 400 employees at the call center there. That will bring the number of employees at the company's three call centers — the other two are in Vienna and Winchester, Va. — to 1,800.
"As we add to membership, it allows us to open up even more branches," Dawson said.
Opening more branches makes it more convenient to transfer checking accounts and do banking during permanent change-of-station moves, as well as expand job opportunities for military spouses.
Many Navy Federal employees are military spouses, including Army and Air Force spouses, especially overseas, Dawson said.
"We like it because when they move, they can transfer. It's a career.
"They understand the military families. They are the military families."
Driving less, saving more
Is the rising price of gas making you drive less? Call your insurance company — you may be able to save money on your auto insurance premiums, the Consumer Federation of America says.
Auto insurance rates are partially based on how much you drive and how you use the car, said J. Robert Hunter, director of insurance for the nonprofit association of consumer groups.
If you've stopped driving your car to work or school, your insurance classification has changed from "drive to work" to "pleasure," and you could save 10 percent to 15 percent on your insurance.
If you're driving only to a train or bus station, your mileage category could change and could save you 5 percent to 10 percent, he said. You could qualify for the same savings if you have consolidated trips and are driving less.
Ask your insurance company whether you qualify for an immediate rate reduction. The savings will vary based on your coverage, but it's worth a call, Hunter said.
Explain what you're doing to drive less, estimate how many fewer miles you're driving and tell the representative you want their cheapest rate for drivers with your new driving pattern.