OneAZ Credit Union

Since its founding in 1951, OneAZ Credit Union has grown to become the largest state-chartered federally insured credit union in Arizona, with $3 billion in assets. The member-owned credit union, headquartered in Phoenix, has 20 branches serving over 185,000 members across the state.

That growth can be partly attributed to what Michael Boden, chief financial officer and chair of the retirement plan committee, describes as the customer service cycle. “To the extent that our associates enjoy working here and are happy, that will translate into the service provided to our membership,” Boden explains. “So, we’ve used the mantra that we are member-centric and associate-focused.”

David Morehead, a vice president at OneDigital and the plan’s consultant, agrees with Boden that this approach works. “They believe that, by taking care of their associates and creating a premier place to work, they will in turn have these associates take care of their members. This approach not only drives retention of their employees but also brings a membership experience for their customers that is personal, relatable and encourages a long-term relationship.”

OneAZ’s benefits package reflects this focus on associates—its term for employees. Thea Ammon, senior benefits and wellness administrator, says the organization looks for ways to support the associates’ financial health with multiple nontraditional benefits to supplement the retirement plans. These benefits include student loan repayment, 100% educational reimbursement, 100% fitness reimbursement, a 50% match on day care expenses, $60 quarterly wellness awards for healthy habits, and the ability to sell vacation time at 100% value.

“We include many financial education initiatives, such as weekly financial tips posted electronically, dedicated financial wellness classes, free paid time to meet with on-site wealth advisers, and monthly financial classes provided during paid time,” says Ammon. She reports widespread usage and satisfaction with the benefits, and her department solicits feedback to determine whether the organization should change its benefits lineup.

OneAZ Credit Union’s approach to terminating its previously frozen defined benefit plan demonstrates its focus on associates’ financial well-being. Over time, the credit union had frozen its DB plan and repositioned it away from replacing a high percentage of income to serving as a retirement income supplement.

Last year, OneAZ terminated the plan with 74 participants still employed at the credit union. Boden says the company’s board wanted to mitigate the termination’s financial impact on the remaining participants. “We worked with our plan administrator and the actuaries of the Principal Group to help us identify the actuarial projection for each of the 74 participants,” Boden says. The result was a customized approach to make supplemental contributions to the affected individuals’ 401(k) accounts. The cost is about $500,000 per year, and Boden describes it as a fair solution for both participants and employer.

Morehead says it was the most unique solution to a termination that he has seen. “While [the move] was in the best interests of OneAZ as a whole, the committee compiled rigorous retirement income replacement projections to ensure the former pension plan participants maintain their trajectory toward a successful retirement,” he says. “I have never had a client offer such a robust replacement package during these termination projects.”

—Ed McCarthy