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A seasoned communications professional with nearly 15 years of experience developing, implementing, and leading a wide range of corporate, internal, crisis, M&A communications, and public relations strategies, Heidi Worker serves as the Director of Communications for Chartway Federal Credit Union. As with many 757 financial institutions, Heidi and her team have been keeping a watchful eye on how COVID-19 is affecting our local economy, not only now, but weeks and months down the road. According to Heidi, as much as we are keeping our sights focused on local business survival, we can't neglect how our personal finances are going to affect the 757's reopening and recovery. 

Check out Heidi's post on our blog to read three trends Chartway is noticing and what they may mean for both our short- and long-term recovery efforts.

Heidi will be here on Friday May 15th from 1 to 2 PM to take your questions and hear your concerns. Leave a question for Heidi below. 

 

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Douglas L. Smith Doug Smith
We have tried to keep this Forum focused on issues pertinent to a business owner or CEO. Heidi's blog drives home the reality that consumer confidence and consumer realities will have a tremendous impact on the pace of business recovery. I look forward to hearing her other thoughts as she answers questions on the Forum today.il and other businesses are given the green light to open their doors fullyBottom line, as consumers grapple with uncertainty, we’re not likely to see a return to “normal” consumer spending in the short-term, even after retail and other businesses are given the green light to open their doors fully
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Alisa Crider acrider
Hello Heidi! We are really pleased to have you on our Forum today. We know Chartway Federal Credit Union has been very busy these past few months helping so many clients and businesses and we appreciate your service to our community! Looking forward to this discussion.
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Heidi E. Worker HeidiElizabeth
Thank you, Doug, and Alisa, for helping lead and guide our community through this dynamic time. I appreciate the opportunity to be with you today!
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Alisa Crider acrider
OK here's my first question, I know others are wondering too! The PPP program’s initial round of funding was exhausted quickly. For the second round approved in late April, demand has slowed considerably. Why do you think that may be the case?
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Bob McKenna
Hi Heidi, Welcome to the Forum. I'm having discussions with some friends and members who are concerned about personal cash flow coming out of the crisis. Some are talking about re-financing their homes to 30-year loans due to the historic low rates. This includes some people who are down to 10 years remaining on mortgages. Any general advice?
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Heidi E. Worker HeidiElizabeth

The Paycheck Protection Program (PPP) – a provision of the CARES Act that offers forgivable low-interest loans to small businesses facing uncertainty during the COVID-19 – has been a vital program. Considering that the PPP's initial $350 billion funding was fully tapped in just two weeks – you’re right – many anticipated the second round of funds to be depleted at the same rate.

There are likely many reasons for the apparent drop in demand. Here are a few of the most common ones:
- Duplicate applications 
- Concerns about unclear and evolving guidelines overall and repayment terms. 
- Some borrowers applied for loans from multiple lenders to increase their chances of being approved.
- Some prospective borrowers likely found that the program wasn't right for their situation

At Chartway, we’ve processed and funded hundreds of applications and continue to receive new applications daily. It’s been really humbling to be able to support businesses and the workers they support, and the outpouring of gratitude has been tremendous.

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Heidi E. Worker HeidiElizabeth
Bob McKenna wrote:
Hi Heidi, Welcome to the Forum. I'm having discussions with some friends and members who are concerned about personal cash flow coming out of the crisis. Some are talking about re-financing their homes to 30-year loans due to the historic low rates. This includes some people who are down to 10 years remaining on mortgages. Any general advice?


Thank you, Bob - great question! With interest rates at historic lows and many people facing a cash flow crunch, there are a lot great options they may wish to consider – including potentially refinancing. 

Whether or not refinancing is the best option will depend on a variety of factors, so I would encourage anyone considering this avenue of support to contact their credit union or bank to really take a deep dive into their financial situation. There may be other options, including an equity line of credit, consolidating debt, looking at tapping into any existing certificates, etc.

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Alisa Crider acrider
Obviously, a PPP loan isn’t right for all businesses, particularly restaurants. What kind of resources are still out there for businesses that weren’t or aren’t able to take advantage of the PPP but still need some assistance?
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Bob McKenna
Thanks, Heidi
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Heidi E. Worker HeidiElizabeth

Thanks, Alisa, for the good question. Overall, at Chartway, we’ve had hundreds of small businesses take advantage of and really benefit from this program, including many restaurants. We’ve also seen some independent contractors/self-employed individuals withdraw their PPP applications – choosing instead to apply for unemployment or seek alternative methods of financial assistance.

Ultimately, it’s important to do a little research and run the math to determine what puts you in the best position. There are also several additional options available to businesses, which are nicely summarized here: https://www.sba.gov/funding-programs/loans/coronavirus-relief-options .

Additionally, financial institutions across the board are offering a wide array of financial support solutions. For example, at Chartway, we’re having individual conversations with members about options including skipping loans and credit card payments, increasing lines of credit, and more.

There are a lot of really beneficial options available, so if you're concerned about your ability to pay a loan or a bill, contact your bank or credit union as soon as possible. Here are some questions you may want to ask:

- What steps do I need to take to qualify for a special loan or skip payment?
- If I skip a payment or more, will my account still be charged interest?
- How long will the help last, and can it be extended?

You may also want to do a financial review to see if you can consolidate debt and take advantage of lower interest rates.

All said, I recommend that prospective borrowers contact their financial institution to thoroughly discuss the terms of the PPP and their unique situation to determine the best solution for them.

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Ron Carlee rcarlee
Many small businesses and individuals will likely max out their credit cards and find themselves under the crushing cost of high, compounding interest. Are banks considering lowering their interest rates and the calculation of interest and fees considering the overall low cost of money? What kind of interest rates could a small business expect to pay for a loan to pay off credit cards when they can reopen their businesses?
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Heidi E. Worker HeidiElizabeth

Bob McKenna wrote:
Thanks, Heidi

Absolutely - really good question, Bob, and it's beneficial to be thinking about how to really maximize your financial position now more than ever.

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Amy Jordan ajordan
Hi Heidi, with low interest rates and volatility in the markets, what do you recommend individuals consider for securing some stability in their investments?  
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K.Hawkins
Hello Heidi, Thank you for being here. Also on personal finances... Wondering if you have advice/know of resources for families now financially supporting young adults who were previously employed in service industries (but don't qualify as dependents), as this may be a longer term situation. 
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Heidi E. Worker HeidiElizabeth
Many small businesses and individuals will likely max out their credit cards and find themselves under the crushing cost of high, compounding interest. Are banks considering lowering their interest rates and the calculation of interest and fees considering the overall low cost of money? What kind of interest rates could a small business expect to pay for a loan to pay off credit cards when they can reopen their businesses?


Thank you, Ron – this health pandemic has had a tremendous impact on small businesses and consumers, at-large. While the response will vary from financial institution to financial institution, in general, credit unions and banks understand the hardship people are facing and are fully and sincerely committed to working with their members/customers to develop individual solutions to complex financial situations. That’s certainly true at Chartway – we’re having deep dive conversations with our members around-the-clock, skipping loan and credit card payments, and more.

In terms of credit card interest rates, those are tied to the Wall Street Journal Prime Rate. We've seen these rates decrease as the Fed has moved to lower interest rates to historically low rates to protect the economy – and we’ve adjusted rates accordingly. This has been common among FI’s.

I will add that in general, credit Unions - including Chartway – have some of the lowest fees compared to banks. This goes for credit cards, as well.

There are a lot of meaningful options available to consumers in terms of financial support, so I recommend people contact their FI to determine what avenues are the best for them.

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Ron Carlee rcarlee
Thanks!
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Heidi E. Worker HeidiElizabeth
Hi Heidi, with low interest rates and volatility in the markets, what do you recommend individuals consider for securing some stability in their investments?  

Hey, Amy – awesome question! With the economy facing unprecedented challenges due to the coronavirus crisis and the global responses to it, we’re definitely seeing this question pop-up quite a bit at Chartway.

Overall, building a balanced investment portfolio that has at least some lower-risk investment can be useful in helping consumers navigate the volatility in the market. The trade-off is that in lowering risk exposure, investors are likely to see lower returns over the long run – so, it’s important to meet with a financial advisor to ensure your investment strategy matches your current and future needs and goals.

I’ll also add that it’s a natural byproduct of market upheaval for people to get nervous about their retirement portfolios and investments, and they may seek to withdraw funds to avoid more immediate losses as a result. Of course, market volatility is the price we pay for long-term positive returns, and exiting the market may ultimately mean missing out on the gains. Most often, the best course of action — particularly for those who are well diversified and whose portfolio aligns with their risk profile, time horizon, and goals — is to stay the course. However, meeting a financial advisor is highly recommended – not just now when there is market volatility but at least annually.

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Heidi E. Worker HeidiElizabeth

Thanks!

Absolutely - thank you, Ron!

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jillianmgoodwin
Hi Heidi! Thanks for sharing your expertise with us today. I have a question regarding how to prioritize personal expenses. You mentioned in your blog the importance of having an emergency fund. I do have an emergency fund but it is not 6 months worth of living expenses yet and I was working on strengthening this prior to covid. Fortunately, I have been able to telework and my paycheck has not been affected by the pandemic; but I know that things could still happen so I should continue to work on saving. Because of covid, my student loans are in deferment and are not accruing any interest. Is there a benefit for me to continue making payments on the student loans at this time, or would it be wiser for me to reallocate that monthly payment towards building my emergency fund?
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Heidi E. Worker HeidiElizabeth
K.Hawkins wrote:
Hello Heidi, Thank you for being here. Also on personal finances... Wondering if you have advice/know of resources for families now financially supporting young adults who were previously employed in service industries (but don't qualify as dependents), as this may be a longer term situation. 


Hey, K. Hawkins!

Unemployment has definitely been a significant reality with the spread of coronavirus – my thoughts are with every family navigating this new world.

In terms of resources, most financial institutions have special financial hardship programs that can offer specific and tangible help and a HUGE array of free tools. For example, at Chartway, we offer a program called Balance that provides confidential, no-cost financial counseling services. These programs can also help people reconfigure their budgets given their new situations.

Filing for unemployment may also be an option. Many people in the service industry make more in the 13-week unemployment than they normally might. Also, in some states, the service industry is beginning to open back up (slowly), which is allowing some people to begin to return to their occupations.

I hope that helps - definitely contact your credit union or bank to see what programs they have to support your unique situation - I guarantee they'll have something that can make a big difference!

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Alisa Crider acrider
Since you have offices in other states, have you noticed any differences in terms of the business climate and businesses’ reactions to COVID-19 from a regional standpoint?
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Heidi E. Worker HeidiElizabeth

There’s no question: COVID-19 has changed nearly every aspect of our daily lives. As one of the largest credit unions in the country – with membership concentrations in Virginia, Utah, and Texas – we’ve noticed a slight correlation in increased consumer spending with the reopening of economies. We’ve also noticed a reduction in borrowing in certain sectors, including auto lending.

However, businesses are still very much feeling the impact of spending being down across all industries and states, as stay-at-home and social distancing measures have restricted what we can spend money on due to restaurants, entertainment venues, and shops being closed or limited in operation, and travel and tourism largely suspended. Equally, the economic consequences of COVID-19 means consumers are pinching pennies, given that many household incomes have been impacted.

As global management consulting firm McKinsey & Company say so well, “We have never before attempted to shut down the modern global economy, much less reopen it in the setting of an ongoing pandemic.”

Additionally, the CDC Director has suggested that resurgence seems to be not a question of if but when, where, and how bad. Many experts are focused on a potential second wave of COVID-19 in the northern hemisphere this autumn.

As businesses and consumers grapple with all this uncertainty, we’re not likely to see a return to “normal” consumer spending in the short-term, even after retail and other businesses are given the green light to open their doors fully. This means that businesses must continue to be flexible, evaluate opportunities to expand digital channels, and really evaluate their strategies and approach to providing goods and services.

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Alisa Crider acrider
How do you see personal and business banking potentially shifting as a result of COVID-19? And how do you see credit unions adjusting to those shifts?
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Heidi E. Worker HeidiElizabeth

At Chartway, we’ve spent a great deal of time talking about this topic with business partners and our Board, leadership, and team members because what we know for sure is that no business will simply “pick up where they left off.” COVID-19 will have a lasting and potentially permanent impact on many things, including the economic landscape, the labor market, consumer behavior, and much more.

In fact, we’re currently having small group discussions with every team member to garner their thoughts about how Chartway can prepare to serve our post-coronavirus world in the most meaningful, adaptable, relevant, and modern way. Here’s what we’ve heard so far – from external partners and our internal team:

Increased demand for digital channels/services. When the coronavirus pandemic hit, in the blink of an eye, the world shifted to “work-at-home” online, digital grocery orders, mobile food delivery, increased online shopping, and more. At Chartway, we were fortunate to have previously invested in robust Online and Mobile Banking services, and to have the ability to safely offer full-service through our Drive-Thru areas and our Direct Teller service, which allows members to complete almost any transaction with a live teller over video. On Monday, we’re also launching Video Banking. Through this technology, members will be able to access branch services and complete nearly all banking needs when at home, at work, or on the go - without needing to step foot in a physical branch or office. 

There’s no question that businesses will need to continue investing in thoughtful digital channel/service expansion – and be prepared to guide consumers of all ages through learning how to use what are now viewed as essential services. They’ll also have to balance digital services with personal human connections because relationships will continue to matter.

Increased demand for debit/credit cards, digital wallets, and tap to pay options. The health crisis has increased the awareness of and need for digital wallets, tap to pay technology, and/or chip cards, as they require less physical interaction and are more secure. Consumers now value these viable ways to maintain wellbeing at physical points of sale.

Increased focus on saving/establishing an emergency savings fund. COVID-19 has served as a wake-up call for those without an emergency savings fund. In an ideal world, everyone should have savings that will allow them to cover three to six months’ worth of expenses when faced with unexpected life events. The unfortunate reality is that many do not, and, for many others, what they do have falls short of what they may need. 

As we move along the COVID-19 curve and certainly after the pandemic, we expect consumers to focus on eliminating debt, and establishing sufficient savings so that whatever challenge or setback arises, they’ll be prepared to weather the storm. 

We also believe that there will likely be an uptick in merger & acquisitions, an increased need for better business automatic, a heightened need for organizational adaptability, and a desire for meaningful, trustworthy, and personal service.

That last one is really important. Now more than ever, it’s so important to be kind, be grateful, be empathetic, and to go the extra mile to support one another. There’s no doubt that this is a dynamic and unprecedented situation for every organization across the globe, but at Chartway, we take seriously our responsibility to care for our team, our members, and our communities. With our culture guiding our every step, we’ve worked tirelessly to ensure we are doing our best and doing what’s right for our people and our members.

Simply said, during this time of social distancing, kindness is trending. Stories of generosity and compassion are all around us, and the need for authentic connection has made a comeback. We believe and we hope that on the other side of these challenging times, kindness will be the only thing that continues to be contagious.

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K.Hawkins
Thanks Heidi, good to know about those counseling programs like Balance!
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Heidi E. Worker HeidiElizabeth
K.Hawkins wrote:
Thanks Heidi, good to know about those counseling programs like Balance!


Absolutely, K. Hawkins - people don't often know about free support programs like these and they are tremendously beneficial! 
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Alisa Crider acrider

Thanks Heidi for this thoughtful response. 

OK switching gears! It appears as though cybercriminals and scammers are paying attention to every headline. They know many people are having difficulties making ends meet...

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Heidi E. Worker HeidiElizabeth

Yes. Unfortunately, cybercriminals are exploiting the COVID-19 situation to benefit themselves. Because fear and uncertainty are some of their greatest weapons, it's important to remain vigilant and to know the signs of a financial scam. Here are a few tips:

Don’t click links from unsolicited emails. Email phishing scams are on the rise. Never click on a suspicious link or open an attachment from a person or organization you don’t know. It’s always safer to visit an organization’s website directly for information. 

Don’t share your personal or banking information. As a rule of thumb, government agencies (including the IRS) will never contact you to request personal identifiable data (i.e., your Social Security number, driver’s license number, bank account number, etc.). Scammers are contacting consumers via phone, text, and email to trick them into providing this sensitive information.

Don’t become a victim of a loan scam. If you need to borrow money during COVID-19, your first point of contact should be your local credit union or bank. These institutions may even be able to identify additional options you can consider before taking on new debt. Always read the fine print before you sign any loan agreement or cash advance, understand the long-term costs and upfront fees, and only work with a reputable lender.

Don’t fall for "get rich quick schemes." There is no current cure for COVID-19, so do not invest in companies claiming to have a vaccine.

When in doubt, contact your bank or credit union. These institutions provide safe and reliable resources you can count on every day, but their assistance is especially meaningful during times of crisis.

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Alisa Crider acrider
Great advice, Heidi. Thanks for this! It also appears that scammers are targeting social media sites to gain access to personal information.
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Heidi E. Worker HeidiElizabeth

This is absolutely true! With many people turning to social media for a fun distraction during the COVID-19 health pandemic, taking a Facebook quiz may seem like a harmless way to pass the time. Unfortunately, doing this could give scammers surfing social media sites access to your personal information. 

They can use any piece of information you share in a viral challenge, including one of the latest acts of social media solidarity with high school seniors where Facebook users are sharing their own senior photos, using the hashtag #ClassOf2020. Scammers then scan sites for this hashtag and find the name of your high school and your graduating year – two VERY common online security questions.

Other recent viral personal list posts include all the cars you've owned (including makes/model years), favorite athletes, and top 10 favorite television shows.

What most people forget is that some of these "favorite things" are commonly used passwords or security questions. If your social media privacy settings aren't high, you could be giving valuable information away for anyone to use. Here are a few tips from the Better Business Bureau.

Resist the temptation to play along. While it's fun to see other's posts, if you are uncomfortable participating, it is best not to do it.

Review your security settings. Check your security settings on all social media platforms to see what you are sharing and with whom you are sharing.

Change security questions/settings. If you are nervous about something you shared potentially exposing you to fraud, review, and change your security settings for banking and other websites. 

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Heidi E. Worker HeidiElizabeth
Hi Heidi! Thanks for sharing your expertise with us today. I have a question regarding how to prioritize personal expenses. You mentioned in your blog the importance of having an emergency fund. I do have an emergency fund but it is not 6 months worth of living expenses yet and I was working on strengthening this prior to covid. Fortunately, I have been able to telework and my paycheck has not been affected by the pandemic; but I know that things could still happen so I should continue to work on saving. Because of covid, my student loans are in deferment and are not accruing any interest. Is there a benefit for me to continue making payments on the student loans at this time, or would it be wiser for me to reallocate that monthly payment towards building my emergency fund?

Hi, Jillian!

Huge virtual high five to you for having an emergency fund, and for your commitment to saving!

In terms of your student loans, even though they aren't accruing interest now, the balance will remain the same, and interest will accrue once reinstated, so there would be a benefit to paying the principal down – if that’s something you can reasonably afford. 

At the same time, because of the deferred payments and no accrued interest – plus the low rates and tax-deduction aspects of student loans - it may also make financial sense to take that money and reallocate it toward personal savings, especially if your funds are interest-earning. 

Because each situation differs, I suggest grabbing 15 minutes with a financial professional to analyze your specific finances to help you determine what may be best for you.

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Alisa Crider acrider
Heidi - thank you so much for being on today! This has been a great thread. We will wrap things up now but if anyone else has a question, feel free to weigh in.

We sure do appreciate having Chartway Federal Credit Union as a partner. Have a great weekend!
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Heidi E. Worker HeidiElizabeth

Thanks for having me! I really enjoyed today’s forum, appreciate the thoughtful questions, and wish everyone continued safety and good health. Have a great weekend - be well, everyone!

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