Our field of membership is Chicago Police Officers and their families. Our officers often work beyond the expiration of their collective bargaining agreement with the city as the new terms are worked out and, in some cases, they may work as long as three years before the new terms are mutually agreed upon. When they do finally receive the raise they are entitled to, usually referred to as retro pay, the amounts can be pretty large.

We recently experienced a retro pay period that could have resulted in a substantial amount of deposits coming into the credit union at a time when we were already flush with cash and struggling to maintain our loan to share ratio. We devised a strategy that encouraged our members to use their retro paychecks in a variety of alternative ways, including investing it with the help of our financial planning partners or putting it toward the purchase of an automobile and a corresponding exceptional loan rate.

The strategy seemed to be partially successful in that it minimized the increase in our shares and we did see significant increases in our financial planning business and in our auto loan volume.  Have any of you encountered a similar situation and, if so, what worked for you?