Every year five families compete for a $10,000 cash prize in an eight-month race to increase savings and reduce debt, a highly publicized event that Wright-Patt Credit Union ($2.6 billion, Fairborn, OH) has held for five years. The Savings Race produces only winners because all of the contestants work with coaches from Wright-Patt’s own staff to improve their finances. Collectively, the five families increased their net worth by $147,000 in the 2012 race, which just concluded.
But the biggest winner may be Wright-Patt, which has used the race to build its name brand and drive business even as it helps ordinary families turn their finances around. Although the five families must be Wright-Patt members, the race has become a community event, with a mini race that nonmembers can participate in. “We’re developing ambassadors who are spreading the word on our behalf,” says Tracy Fors, the credit union’s vice president of marketing and development.
Market awareness for Wright-Patt has risen 13% since the first Savings Race in 2008. The race is credited with increasing the credit union’s loan volume 27% and membership 10% during the past five years, says Fors, who introduced the Savings Race idea. As a result, Wright-Patt offers a five-step model for credit unions that want to do something similar in their own communities.
Find a Like-Minded Media Partner
From the beginning, Wright-Patt has worked with local NBC news affiliate WDTN, which airs regular segments about the families’ progress. WDTN is a true partner, shouldering half of the race’s costs. In 2012, Wright-Patt spent nearly $228,000 —12% of its marketing budget — on the race. Fors was drawn to WDTN because the station shares similar values as the credit union. “Their tag line is ‘We’re on your side,’ and it fit in with us,” she says.
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Be Choosy About Contestants
The families are selected in part because they need help managing their finances, but they also must be able to articulate what they hope to achieve. “They need to be effective communicators because they will be on television,” Fors says. Besides giving regular interviews to WDTN, the families participate in a commercial about the race. Fors looks at other qualifiers as well, including how family members interact and how open they are about their finances. The credit union also conducts background and credit checks on the contestants, who typically have credit scores in the 600s.
Teach the Basics
Three coaches are assigned to each family to teach and motivate the team through a steady series of challenges that constitute the race. Those challenges may include tracking household spending, paying down credit cards, or grocery shopping on a limited budget. “One family took their monthly $1,000 grocery bill and whittled it down to $168,” Fors says. “And this was a family of five with two college-age boys.” For many contestants, the household budgets they draw up for the race are the first ones they’ve ever created — or stuck to — in their lives.
Introduce Timely Themes
Although the first three races were about whipping family finances into shape, the past two have had distinct themes: housing and college. People usually save for the same reasons, for a child’s education or a home, Fors says. After witnessing so many foreclosures, many people hesitated to buy a house, so Fors saw a great opportunity for financial education. “People who attend classes for home ownership are better at keeping that home in the long run,” she says. Homebuyers were also more inclined to get the loan from Wright-Patt, which received an additional $26.8 million in new mortgage applications during the housing-theme race.
The next race, which starts in October, will have health as its theme, just in time for the health insurance exchanges that will debut around then. Wright-Patt is teaming up with two local hospitals for the race’s events and curriculum. Besides insurance, what’s the connection between health and finances? “Unhealthy decisions cost you money over time and create stress, which makes your health even worse,” Fors says.
To broaden its reach, Wright-Patt involves the community in myriad ways. One year, the credit union hosted a phone bank at WDTN and answered personal finance questions from callers. A number of the race’s free events, including a kick-off party to announce and introduce the participating families, are held in public places, such as parks, museums, and community centers. And, inspired by reality shows like American Idol, Wright-Patt invites everyone in the community to vote online for the winner. The voting accounts for 10% of each family’s total score.
Even nonmembers can participate on their own in a mini race, a checklist of 28 activities that are each worth points. After accumulating 25 points, participants who show proof of accomplishing the tasks receive a $25 gift card from the credit union and are entered in a $1,000 drawing. For the college-savings race, the activities included researching federal student loans and scholarships or devising ways to pay for and save money on a large future purchase. One activity, worth a hefty 10 points, was especially easy to do: Open a Wright-Patt savings and checking account.