ON THE MONEY
Steve Pierce responds to your financial concerns
I’ve heard people talk about them but what is a Credit Union?
In the mid-1980s I was heavily involved in setting up a Credit Union in Huyton, Liverpool and I have been a huge fan of credit unions ever since.
Basically, a credit union is a mutual society, a not-for-profit organisation where members can save and borrow money. There are no shareholders and credit unions are usually run by volunteers. You must work or live within “the common bond”.
Credit Unions are regulated like banks or building societies so money is safe. Members save on a regular basis and earn interest paid as a dividend each year. Members can also apply to borrow money.
Interest rates are low, usually between 1% and 2% per month on the reducing balance of what you have borrowed.
In low-income communities credit unions offer affordable credit and create social networks which help develop financial capability. Churches play an important role in setting up credit unions, often in partnership with other community groups, or in supporting established credit unions.
There are around 500 credit unions in the UK.
For more information and to find your nearest credit union visit www.abcul.org
Is it OK to stop giving to clear my debts?
Getting debt-free is good for our mental health so shifting debt is a positive move. There is a difference to having debts and struggling to repay debts.
If you have credit card debts because of lifestyle choices, make some lifestyle changes first rather than let your giving to church and charity subsidise the quick repayment of those debts. But if you are really struggling with debts, maybe on a debt repayment plan, then it may be right to reduce giving to release the burden of debt.
Will reduced giving repay debts or increase lifestyle? It is a heart issue in the end. What do you sense God is saying to you? My advice is not to lose the godly practice of giving so that when circumstances improve giving does too.
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Steve Pierce is the Head of Stewardship Money, the education ministry suypporting churches in giving and good stewardship practice. Send your questions to him
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