As credit union employees, and hopefully evangelists, we know the power of credit unions in giving back to their communities. All credit unions innately have charitable components, so why, you may ask, do some have charitable foundations in addition to their existing community donation and sponsorship efforts—and if you don’t have one, do you need one?
Let’s dig in.
Service Credit Union launched its foundation, the Service CU Impact Foundation, in 2020, in order to do just what its name implies: create an impact. Our goal was to have a dedicated arm to support our most critical initiatives, and increase the size of our giving footprint.
After a deep look into our history and membership as well as where we could most make a difference in our home state of New Hampshire, the Service CU Impact Foundation decided to home in on three focus areas: veterans, military and first responders; housing and homelessness; and education. Since then, we’ve donated millions of dollars to nonprofits serving veterans and military families, shelters and supportive housing programs, affordable housing efforts, and more. We’ve also awarded more than $400,000 in scholarships to college students as well as adult learners.
If, like us, your credit union has a cause that’s truly near and dear to your hearts, a foundation can help you deepen that impact. Unlike community sponsorships, which usually operate under fixed budgets, foundations rely on fundraising, meaning your potential support can grow as large as your donor base. At Service Credit Union, we’ve been fortunate to receive generous contributions to the foundation from both the community and our vendors, and we’ve even brought our members into the effort with a successful online banking raffle program.
Making a lasting difference is the best reason to start a foundation. But it’s not the only one. A foundation can also build goodwill, strengthen community relationships, expand your SEG and membership reach, and elevate your credit union’s visibility.
So, how do you get started? First, understand that it takes time.
The steps vary by state, but establishing a 501(c)(3) foundation typically involves incorporating at the state level, selecting a name, appointing a board of directors, and filing articles of incorporation. You’ll also need an Employer Identification Number (EIN), IRS approval for tax-exempt status, and state registration for charitable solicitations.
You’ll also need to determine staffing. Some credit unions dedicate a full-time team, while others rely on their existing marketing or community development department, or a hybrid approach. You’ll also want to consider your signature fundraising events and what will resonate with your supporters.
It’s not an overnight process. But if you’re committed to advancing a cause that aligns deeply with your mission, building a foundation can be one of the most rewarding steps your credit union takes.
