In Case You Missed It – 2.21.24
FAFSA fumbles, understanding the unbanked, paying for priority privilege, pricy pet ownership, astonishing AI advancements, and auto prices are almost normal. No one has time to catch all the news, so here’s what we’ve seen lately, in case you missed it:
FAFSA frustrations flummox families
For millions of college-bound students, filling out the FAFSA is step one toward getting financial aid and student loans. Trouble is, the Federal Department of Education has badly fumbled the launch of a new online form; it’s months late and availability is still frustratingly sporadic. The future effects are still unknown, but it does seem clear that a lot of people and institutions aren’t going to have the answers and information they need in time to make some very important decisions in the months ahead. It’s a mess, and credit unions will need to be ready with fast and flexible financing answers this summer.
New vehicle inventory recovering
The supply of new vehicles is (finally) getting close to normal, at least on average. Some brands and models, like many popular Toyotas and Hondas, are still in high demand and short supply, with high prices to match. Overall, new vehicle prices are moderating, but only a little bitty bit – the average new vehicle list price is an eye-watering $47,142, down just 1% from last year. (And am I the only one thinking that car payments approaching $1,000 a month are maybe a little, you know, kookoo..?)
Why are so many people unbanked?
Nearly 1 out of 5 people have little or no connection to a bank or credit union. (And that number doesn’t include homeless people, undocumented immigrants or anyone without a permanent address – which is one of the requirements to open an account.) Those that are Unbanked and Underbanked gave several reasons why (minimum balances, don’t trust banks, too many fees that are too high, etc.), yet they are also fighting against a growing number of businesses that won’t take cash.
Would you offer cutting in line if it makes you money?
No one likes someone trying to cut in line. But there’s a growing number of businesses making money off of helping people skip the wait. While I’m not willing to spend that the $$ for first class tickets, I will sometimes spend the extra $15-25 for Southwest’s Early Bird check-in. Today, 19m people pay Clear $189/year, in order to skip airport security lines. Universal Studios will let you skip lines their park for about $110 each. Really need a date? Tinder charges users $499/month to have their dating profile prioritized. Of course no one is surprised when banks prioritize their biggest customers, but will this chance to make more money trickle down to credit unions as well? Let’s hope not.
Pets are expensive family members
66% of all US households own a pet, and 97% of all pet owners consider them to be part of their family. So much so, that they will move from an apartment to a house with a yard, or live on a tighter budget in order to cover pet-related expenses. Because having a pet isn’t cheap. According to the ASPCA, the average pet owner spends nearly $1,400 annually. However, other sources put this number much higher, especially if they face unexpected vet bills. Perhaps CUs should look at offering pet insurance?
AI video is getting scary good, scary fast
This WaPo article discusses OpenAI’s new AI tool “Sora,” which can take a simple text prompt and generate a highly realistic 60-second video. There are other tools like this in development, but Sora represents a leap in quality and capability that has people surprised and concerned. We’re already seeing malicious uses for existing AI tools, and with the rapid improvement of this technology it’s important to stay informed about what is and isn’t possible. This is doubly true for credit unions, so that they can help keep their members safe as well.
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