Philanthropy s Role in Meeting the Financial Needs of Military Families

1. Philanthropy�s Role in Meeting the Financial Needs of Military Families Brought to you by: PenFed Foundation Kate Kohler, Chief Operating Officer Dan Schenk, Program Specialist

2. Military Life & Financial Stress Deployments Extended and multiple deployments Extra expenses Sharply increased spending 2 months before deployment and 2 months after return With 2 wars going on in the Middle East, a large number of servicemembers are finding themselves on deployment. Deployments can last a year or more and it�s not uncommon for soldiers to serve three or four tours overseas. The conflicts in Iraq and Afghanistan are long campaigns with an unknown end, so there is little hope in the near future that our Armed Forces will stop sending men and woman abroad. Besides the obvious physical and emotional stress of being deployed for war, deployment creates extreme financial stress on servicemembers and their families. The long and multiple deployments mean that spouses find themselves in charge of the finances when they may have never had to think about it. Suddenly, they�re required to pay the bills on time, manage expenses, keep track of bank accounts, and a myriad of other things. While this may seem easy to some, it can be very challenging for someone who is not experienced, and it can lead to mistakes that severely hurt a family�s financial situation. Deployments also create many new expenses for families. Childcare tends to be a common new expense because families lose a care provider when one of the parents goes off to war. A simple thing like going to the doctor may now require a babysitter because no else is left to watch the little ones. Emotional support is crucial for families too, so travel is more than likely as trips are planned to go see friends and family across the country. And nowadays, the price of travel can drain anyone�s savings. Experience has shown too that spending dramatically increases 2 months before deployment and 2 months after the servicemember returns. There are all sorts of expenses that incur as a soldier gets ready to deploy. Families must think long term and spend more than their budget allows to prepare for the upcoming year. And then when he or she returns it�s a time of celebration in the hopes of making up for lost time. With the family so happy to have everyone back together again, money is rarely on anyone�s mind.With 2 wars going on in the Middle East, a large number of servicemembers are finding themselves on deployment. Deployments can last a year or more and it�s not uncommon for soldiers to serve three or four tours overseas. The conflicts in Iraq and Afghanistan are long campaigns with an unknown end, so there is little hope in the near future that our Armed Forces will stop sending men and woman abroad. Besides the obvious physical and emotional stress of being deployed for war, deployment creates extreme financial stress on servicemembers and their families. The long and multiple deployments mean that spouses find themselves in charge of the finances when they may have never had to think about it. Suddenly, they�re required to pay the bills on time, manage expenses, keep track of bank accounts, and a myriad of other things. While this may seem easy to some, it can be very challenging for someone who is not experienced, and it can lead to mistakes that severely hurt a family�s financial situation. Deployments also create many new expenses for families. Childcare tends to be a common new expense because families lose a care provider when one of the parents goes off to war. A simple thing like going to the doctor may now require a babysitter because no else is left to watch the little ones. Emotional support is crucial for families too, so travel is more than likely as trips are planned to go see friends and family across the country. And nowadays, the price of travel can drain anyone�s savings. Experience has shown too that spending dramatically increases 2 months before deployment and 2 months after the servicemember returns. There are all sorts of expenses that incur as a soldier gets ready to deploy. Families must think long term and spend more than their budget allows to prepare for the upcoming year. And then when he or she returns it�s a time of celebration in the hopes of making up for lost time. With the family so happy to have everyone back together again, money is rarely on anyone�s mind.

3. Military Life & Financial Stress Effects of War Overwhelming number of wounded Expense of long term care PTSD & the difficulty of transition into civilian life As with any war, there is a steep price for victory. Our servicemembers pay for their success with their own physical, mental, and emotional stress. And in some instances, they pay the ultimate price with their own lives. In World War II, the ration of wounded to dead was 3 to 1. But with today�s medical advances and technology, that ratio has grown to 8 to 1. Therefore, more wounded soldiers are returning home than ever. While we are grateful to more returning than ever, it creates an ever growing financial issue in our country. The government�s support is limited by its budget and work opportunities can be difficult depending on the severity of the injuries. The long term nature of wounds is a financial issue as well because wounds do not heal overnight. While government support is available to all wounded veterans, it can take months for disability claims to kick in. And even if servicemembers receive disability payment it may not be enough because ratings can be inaccurately assessed. In fact, studies show that more than 2,000 discharges per year are inaccurately rated for disability. PTSD has been an issue for returning soldiers for decades, but its complete nature is only now being recognized. Mental trauma can make the transition into civilian life very difficult. Often times, those dealing with PTSD cannot make the switch into civilian working life right after the military. Many require ample time to readjust before they are able to enter the workforce. This means that many veterans go months without a steady paycheck and rely solely on disability payments, if they even receive that. Financial stress can be further compounded if a spouse must leave the workforce to care for wounded veterans. Often, recovering soldiers need assistance and the spouse typically fills this role. However, with no one having a steady paycheck, the family�s expense will quickly outgrow what they can afford.As with any war, there is a steep price for victory. Our servicemembers pay for their success with their own physical, mental, and emotional stress. And in some instances, they pay the ultimate price with their own lives. In World War II, the ration of wounded to dead was 3 to 1. But with today�s medical advances and technology, that ratio has grown to 8 to 1. Therefore, more wounded soldiers are returning home than ever. While we are grateful to more returning than ever, it creates an ever growing financial issue in our country. The government�s support is limited by its budget and work opportunities can be difficult depending on the severity of the injuries. The long term nature of wounds is a financial issue as well because wounds do not heal overnight. While government support is available to all wounded veterans, it can take months for disability claims to kick in. And even if servicemembers receive disability payment it may not be enough because ratings can be inaccurately assessed. In fact, studies show that more than 2,000 discharges per year are inaccurately rated for disability. PTSD has been an issue for returning soldiers for decades, but its complete nature is only now being recognized. Mental trauma can make the transition into civilian life very difficult. Often times, those dealing with PTSD cannot make the switch into civilian working life right after the military. Many require ample time to readjust before they are able to enter the workforce. This means that many veterans go months without a steady paycheck and rely solely on disability payments, if they even receive that. Financial stress can be further compounded if a spouse must leave the workforce to care for wounded veterans. Often, recovering soldiers need assistance and the spouse typically fills this role. However, with no one having a steady paycheck, the family�s expense will quickly outgrow what they can afford.

4. Military Life & Financial Stress Struggling Economy & Lack of Financial Literacy High Unemployment Little formal education, especially in finance and money management Everyday in the news we hear about the bad economy and highest levels of unemployment we�ve seen since the Great Depression. Well this harsh reality is no different for military veterans. In fact, it may be even harder for veterans to find work because they don�t have as much formal education as many people because they chose to enter the Armed Forces rather than go to college. Also, their military experience may not transfer into needed skill sets in civilian life. This education deficit especially shows in the area of financial literacy. While the military teaches you numerous skills, money management is not top priority at boot camp. Many veterans find themselves having to deal with their finances for the first time in their lives upon discharge, and challenge can be overwhelming. They never had to think about paying the rent and utilities while having enough left over to buy groceries. The military took care of their basic needs, but now they�re thrown into a world where they�re responsible for everything. And more than likely they�re going to stumble a few times before they adjust to their new life. Everyday in the news we hear about the bad economy and highest levels of unemployment we�ve seen since the Great Depression. Well this harsh reality is no different for military veterans. In fact, it may be even harder for veterans to find work because they don�t have as much formal education as many people because they chose to enter the Armed Forces rather than go to college. Also, their military experience may not transfer into needed skill sets in civilian life. This education deficit especially shows in the area of financial literacy. While the military teaches you numerous skills, money management is not top priority at boot camp. Many veterans find themselves having to deal with their finances for the first time in their lives upon discharge, and challenge can be overwhelming. They never had to think about paying the rent and utilities while having enough left over to buy groceries. The military took care of their basic needs, but now they�re thrown into a world where they�re responsible for everything. And more than likely they�re going to stumble a few times before they adjust to their new life.

5. Effect of Military Life on Financial FutureFICO Score by Rank Dark Green Prime Light Green Acceptable Yellow Sub Prime Red Unacceptable So the result of all these effects of military life is often poor credit and financial struggle. This chart shows exactly the full nature of the problem. This chart was created using statistical data collected from over 100,000 active duty military PenFed members, and it shows the full extent of the financial problems our servicemembers have. As a quick explanation, the two shades of green are prime and acceptable credit scores while the yellow and red are subprime and unacceptable scores. And as we all know, our credit score is vital in securing a loan or mortgage of any kind, and only those with good credit scores will be able to secure a loan or mortgage. Maybe several years ago one might be able to secure a subprime mortgage, but with the effect of subprime mortgages on creating the current recession I don�t foresee many subprime loans being given out in the near future. Now, the most important piece of information to take away from this chart is the extent of poor credit among our youngest enlisted ranks. 60% of E1 to E3 personnel struggle with poor credit and may not be able to secure loans. The next step up isn�t much better with 40% of E4 through E6 personnel having bad credit. These statistics are staggering because we�re talking about hundreds of thousands of our servicemembers not being able to qualify for a loan or mortgage. These men and women are some of the bravest warriors in the world and who put their lives on the line everyday for their country and they can�t even buy a home for their family. So the result of all these effects of military life is often poor credit and financial struggle. This chart shows exactly the full nature of the problem. This chart was created using statistical data collected from over 100,000 active duty military PenFed members, and it shows the full extent of the financial problems our servicemembers have. As a quick explanation, the two shades of green are prime and acceptable credit scores while the yellow and red are subprime and unacceptable scores. And as we all know, our credit score is vital in securing a loan or mortgage of any kind, and only those with good credit scores will be able to secure a loan or mortgage. Maybe several years ago one might be able to secure a subprime mortgage, but with the effect of subprime mortgages on creating the current recession I don�t foresee many subprime loans being given out in the near future. Now, the most important piece of information to take away from this chart is the extent of poor credit among our youngest enlisted ranks. 60% of E1 to E3 personnel struggle with poor credit and may not be able to secure loans. The next step up isn�t much better with 40% of E4 through E6 personnel having bad credit. These statistics are staggering because we�re talking about hundreds of thousands of our servicemembers not being able to qualify for a loan or mortgage. These men and women are some of the bravest warriors in the world and who put their lives on the line everyday for their country and they can�t even buy a home for their family.

6. I�m in a short-term money crunch! What do I do? So the question becomes, What do I do if I find myself in a money crunch? The question isn�t so simple because there are many different ways to go about answering it. 21% decide not to pay some bills in order to pay others � that�s not a good idea! 25% charge it to a credit card � while the bill gets paid they�ll probably end up paying for it double with the outrageous interest rates on some credit cards! 29% take out a loan � which could be good but as we already saw many enlisted servicemembers don�t have that option 51% borrow money from friends and family � probably interest free but I bet it�s getting tougher to find generous loved ones in this recession And finally 60% acquire a payday loan � definitely not a good option!So the question becomes, What do I do if I find myself in a money crunch? The question isn�t so simple because there are many different ways to go about answering it. 21% decide not to pay some bills in order to pay others � that�s not a good idea! 25% charge it to a credit card � while the bill gets paid they�ll probably end up paying for it double with the outrageous interest rates on some credit cards! 29% take out a loan � which could be good but as we already saw many enlisted servicemembers don�t have that option 51% borrow money from friends and family � probably interest free but I bet it�s getting tougher to find generous loved ones in this recession And finally 60% acquire a payday loan � definitely not a good option!

7. Payday LoansThe popular choice, but not the wise choice Small loans of $100 to $1,000 Extremely high fees ranging from $15 to $30 per $100 borrowed APR can be in excess of 700% Short-term with payback in as little as 2 weeks No credit check required It�s not a good option, but it�s obviously the more popular choice So what exactly is a payday loan? -It�s a small loan of typically $100 to $1,000 -It carries an extremely high fee with it that can range from $15 to $30 for every $100 borrowed � so you could pay a $150 fee for a $500 loan -APR is outrageous and can exceed 700% -It�s very short term with payback typically in as little as 2 weeks when the next paycheck comes -And lenders don�t check your credit, so they have no idea if you�re likely to be able to pay back the loanIt�s not a good option, but it�s obviously the more popular choice So what exactly is a payday loan? -It�s a small loan of typically $100 to $1,000 -It carries an extremely high fee with it that can range from $15 to $30 for every $100 borrowed � so you could pay a $150 fee for a $500 loan -APR is outrageous and can exceed 700% -It�s very short term with payback typically in as little as 2 weeks when the next paycheck comes -And lenders don�t check your credit, so they have no idea if you�re likely to be able to pay back the loan

8. Predatory Payday Lending Practices Directed at Military Personnel Financial stresses of military life and steady government paycheck attract payday lenders Increased number of payday lenders in close proximity to military installations On-line affinity marketing techniques used to target military personnel The facts on these payday loans are staggering, but what is more upsetting is the predatory practices of payday lenders directed at military personnel. Payday lending is a business worth billion of dollars, and lenders know a good client base for their business is military personnel. The military is targeted because of all the challenges of military life that we already mentioned and the financial hardship that comes along with them. Payday lenders know servicemembers are often in financial trouble and need emergency money, and they know servicemembers receive a steady government paycheck so the likelihood of borrowers being able to repay the loan is high so as to avoid defaulting and loss of revenue for the lender. In essence, military personnel are cash cows for payday lenders, and so the lender actively go after servicemembers for business. In fact, it�s documented that the number of payday lenders is increased in close proximity to military installations. Where there�s a base, there�s soldiers and where there�s soldiers, there�s money to be made. Payday lenders also make use of the internet by marketing their �service� on websites heavily trafficked by the military. These affinity marketing techniques draw the attention of a lot of military personnel and make them believe that payday lending is the best and only option for them. In fact, a good case in point are the Money Mutual commercials you have seen on TV. For those of you who haven�t seen the commercials, Money Mutual is an online payday lender and their commercial features Montel Williams as their spokesperson. Some of you may know this but Montel Williams is a graduate of the U.S. Naval Academy and a 22 year veteran of the navy. This may be a coincidence, but I�m inclined to believe they chose Montel because of his military background and the trust that creates within the military community.The facts on these payday loans are staggering, but what is more upsetting is the predatory practices of payday lenders directed at military personnel. Payday lending is a business worth billion of dollars, and lenders know a good client base for their business is military personnel. The military is targeted because of all the challenges of military life that we already mentioned and the financial hardship that comes along with them. Payday lenders know servicemembers are often in financial trouble and need emergency money, and they know servicemembers receive a steady government paycheck so the likelihood of borrowers being able to repay the loan is high so as to avoid defaulting and loss of revenue for the lender. In essence, military personnel are cash cows for payday lenders, and so the lender actively go after servicemembers for business. In fact, it�s documented that the number of payday lenders is increased in close proximity to military installations. Where there�s a base, there�s soldiers and where there�s soldiers, there�s money to be made. Payday lenders also make use of the internet by marketing their �service� on websites heavily trafficked by the military. These affinity marketing techniques draw the attention of a lot of military personnel and make them believe that payday lending is the best and only option for them. In fact, a good case in point are the Money Mutual commercials you have seen on TV. For those of you who haven�t seen the commercials, Money Mutual is an online payday lender and their commercial features Montel Williams as their spokesperson. Some of you may know this but Montel Williams is a graduate of the U.S. Naval Academy and a 22 year veteran of the navy. This may be a coincidence, but I�m inclined to believe they chose Montel because of his military background and the trust that creates within the military community.

9. As I mentioned, payday lenders are found in large numbers around military installations, and this map shows the true extent of it. This map is taken from a 2006 DoD report on the predatory lending practices of payday lenders directed at the military, and it shows the concentration of payday lenders around Fort Campbell, home to the Screaming Eagles of the Army�s legendary and iconic 101st Airborne Division. The blue triangles indicate banks while the yellow and other color squares represent payday lenders. Let�s create a scenario so you understand the lengths to which payday lenders will go to attract military personnel. Staff Sergeant Smith of the 101st Airborne is stationed at Fort Campbell along the Kentucky-Tennessee border. He lives here *click* in the town of Clarksville, Tennessee. Clarksville is a small town near the base and very familiar to those stationed at Fort Campbell. Every morning, SSG Smith drives from his home on the south side of town through Clarksville. As he drives, he passes *click* 4 payday lenders before leaving town. To get to base, SSG Smith drives north *click* up Route 41. About halfway there, he passes *click* this commercialized area. Here he passes the Walmart, the Pizza Hut, *click* and 14 payday lenders. SSG Smith�s only halfway, though, so he continues *click* to drive north up Route 41. Eventually, he hits another commercialized area with some more stores and restaurants. But this time he passes *click* another 16 payday lenders. Now if you�re asking yourself why are there are so many payday lenders stretched out across this short bit of road. The answer is quite simple *click* this is where 3 of Fort Campbell�s most heavily trafficked gates are found. Almost all military personnel come in and out of these 3 gates, and they can�t help but run straight into a payday lender no matter which direction they go. In fact, *click* SSG Smith ends up passing 34 payday lenders on the way from his home to the base. The concentration of payday lenders around Fort Campbell leaves soldiers at the base thinking these loans are the best option if I get into financial trouble. Heck, I can go right down the street and get a loan right now without any trouble or effort.As I mentioned, payday lenders are found in large numbers around military installations, and this map shows the true extent of it. This map is taken from a 2006 DoD report on the predatory lending practices of payday lenders directed at the military, and it shows the concentration of payday lenders around Fort Campbell, home to the Screaming Eagles of the Army�s legendary and iconic 101st Airborne Division. The blue triangles indicate banks while the yellow and other color squares represent payday lenders. Let�s create a scenario so you understand the lengths to which payday lenders will go to attract military personnel. Staff Sergeant Smith of the 101st Airborne is stationed at Fort Campbell along the Kentucky-Tennessee border. He lives here *click* in the town of Clarksville, Tennessee. Clarksville is a small town near the base and very familiar to those stationed at Fort Campbell. Every morning, SSG Smith drives from his home on the south side of town through Clarksville. As he drives, he passes *click* 4 payday lenders before leaving town. To get to base, SSG Smith drives north *click* up Route 41. About halfway there, he passes *click* this commercialized area. Here he passes the Walmart, the Pizza Hut, *click* and 14 payday lenders. SSG Smith�s only halfway, though, so he continues *click* to drive north up Route 41. Eventually, he hits another commercialized area with some more stores and restaurants. But this time he passes *click* another 16 payday lenders. Now if you�re asking yourself why are there are so many payday lenders stretched out across this short bit of road. The answer is quite simple *click* this is where 3 of Fort Campbell�s most heavily trafficked gates are found. Almost all military personnel come in and out of these 3 gates, and they can�t help but run straight into a payday lender no matter which direction they go. In fact, *click* SSG Smith ends up passing 34 payday lenders on the way from his home to the base. The concentration of payday lenders around Fort Campbell leaves soldiers at the base thinking these loans are the best option if I get into financial trouble. Heck, I can go right down the street and get a loan right now without any trouble or effort.

10. A similar situation exists at Fort Lewis and McChord AFB near Tacoma, Washington. As you can see, payday lenders are located throughout the southern Tacoma area, but there are several concentrations around the edges of the base. For instance, here *click* one of the main entrances to Fort Lewis and the entrance closest to the army medical hospital. Within 1 mile of the entrance, *click* 5 payday lenders can be found. Even worse is here, *click* the entrance to McChord AFB. Within 3 miles of this entrance, *click* there are a staggering 20 payday lenders lined up along the road leading up to the base�s gate. It�s not a coincidence that all these payday lenders are concentrated in one spot. Plain and simple, they�re targeting the military personnel to offer them loans that they can�t afford.A similar situation exists at Fort Lewis and McChord AFB near Tacoma, Washington. As you can see, payday lenders are located throughout the southern Tacoma area, but there are several concentrations around the edges of the base. For instance, here *click* one of the main entrances to Fort Lewis and the entrance closest to the army medical hospital. Within 1 mile of the entrance, *click* 5 payday lenders can be found. Even worse is here, *click* the entrance to McChord AFB. Within 3 miles of this entrance, *click* there are a staggering 20 payday lenders lined up along the road leading up to the base�s gate. It�s not a coincidence that all these payday lenders are concentrated in one spot. Plain and simple, they�re targeting the military personnel to offer them loans that they can�t afford.

11. Effect of Predatory Lending on Armed Forces Financial stress and debt decreases readiness and productivity 60% of security clearances are denied due to financial problems Added stress for families already struggling with the hazards of military life As I mentioned these 2 reports came from 2006 report from the Department of Defense. And the reason why the DoD has taken such an interest in predatory lending is because it has so many negative effects on military and civilian personnel. As we�ve already seen, payday loans can create long term financial hardship which can then lead to a decrease in readiness and productivity. And the logic behind it is simple. Our servicemembers have a lot on their mind leading up to deployment. What they do not need is the pressure of settling their debts before leaving so their family is not stuck with the burden. But even if our troops are not set to deploy, financial stress will severely limit their productivity because their mind is constantly working out ways to lift the burden of debt of them and their family and not on their training or duties. Some our best talent is also denied positions or promotions because they cannot obtain the necessary security clearance. One�s credit is a major factor in obtaining a security clearance, so those with poor credit often find themselves on the outside looking in. In fact, 60% of those who are denied a clearance are denied due to financial problems. Lastly, getting into debt with the payday lenders causes more stress on families which already struggle with the possibly losing a loved one or having someone severely wounded. As I mentioned these 2 reports came from 2006 report from the Department of Defense. And the reason why the DoD has taken such an interest in predatory lending is because it has so many negative effects on military and civilian personnel. As we�ve already seen, payday loans can create long term financial hardship which can then lead to a decrease in readiness and productivity. And the logic behind it is simple. Our servicemembers have a lot on their mind leading up to deployment. What they do not need is the pressure of settling their debts before leaving so their family is not stuck with the burden. But even if our troops are not set to deploy, financial stress will severely limit their productivity because their mind is constantly working out ways to lift the burden of debt of them and their family and not on their training or duties. Some our best talent is also denied positions or promotions because they cannot obtain the necessary security clearance. One�s credit is a major factor in obtaining a security clearance, so those with poor credit often find themselves on the outside looking in. In fact, 60% of those who are denied a clearance are denied due to financial problems. Lastly, getting into debt with the payday lenders causes more stress on families which already struggle with the possibly losing a loved one or having someone severely wounded.

12. How do we end predatory lending? How do we stop the cycle of high cost payday loans? So the question becomes, how do we end predatory lending? And how do we stop the cycle of high cost payday loans?So the question becomes, how do we end predatory lending? And how do we stop the cycle of high cost payday loans?

13. ARKAsset Recovery Kit Interest-free, short-term advances Active duty, reserve, and national guard military personnel Fee of $1 for every $100 borrowed for up to $500 (or 80% of net pay) No credit report Five advances per year Required to receive financial counseling before each subsequent cash advance The answer is ARK. ARK or Asset Recovery Kit is a program offered by the PenFed Foundation to other credit unions. It offers: -Interest-free, short-term advances for active duty, reserve, and national guard military personnel with emergency cash needs. -Borrowers pay only a fee of $1 for every $100 borrowed with absolutely no interest for immediate cash advances up to $500 (or 80% of net pay) -No credit report is pulled and applying requires filling out only an easy-to-complete single sheet requesting contact and pay information. -Five advances can be given in a one-year period, but he or she is required to receive financial counseling before each subsequent cash advance. The answer is ARK. ARK or Asset Recovery Kit is a program offered by the PenFed Foundation to other credit unions. It offers: -Interest-free, short-term advances for active duty, reserve, and national guard military personnel with emergency cash needs. -Borrowers pay only a fee of $1 for every $100 borrowed with absolutely no interest for immediate cash advances up to $500 (or 80% of net pay) -No credit report is pulled and applying requires filling out only an easy-to-complete single sheet requesting contact and pay information. -Five advances can be given in a one-year period, but he or she is required to receive financial counseling before each subsequent cash advance.

14. ARK All losses are guaranteed and repaid by PenFed Foundation PenFed Foundation is an independent 501(c)(3) charity created to help solve the financial problems facing our brave fighting men and women What makes ARK so unique and appealing to your credit union and its members is that all losses are guaranteed and repaid by the PenFed Foundation. Your credit union is at absolutely zero risk with this program because all defaulted loans are repaid to you by us. I cannot stress how important this point is because it is so unique and presents you with an absolutely amazing opportunity to help your members. We are able to do this because the PenFed Foundation is an independent 501c3 charity whose mission it is to help solve the financial problems facing our brave fighting men and women. We receive donations from across the country from concerned individuals and companies who believe in our cause and want to help. It is because of this generous support that we are able to support ARK.What makes ARK so unique and appealing to your credit union and its members is that all losses are guaranteed and repaid by the PenFed Foundation. Your credit union is at absolutely zero risk with this program because all defaulted loans are repaid to you by us. I cannot stress how important this point is because it is so unique and presents you with an absolutely amazing opportunity to help your members. We are able to do this because the PenFed Foundation is an independent 501c3 charity whose mission it is to help solve the financial problems facing our brave fighting men and women. We receive donations from across the country from concerned individuals and companies who believe in our cause and want to help. It is because of this generous support that we are able to support ARK.

15. ARK All losses are guaranteed and repaid by PenFed Foundation Program and all forms, advertisements, and marketing materials are branded with your name and logo Just because I can�t reinforce this point enough�all losses from ARK are repaid to your credit union. You have absolutely no risk with this loan program. ARK is also branded with your name and logo. All the forms, advertisements, and marketing materials have the look and feel of your credit union. While the PenFed Foundation is offering this program to you, we want it to become your program for your members. Just because I can�t reinforce this point enough�all losses from ARK are repaid to your credit union. You have absolutely no risk with this loan program. ARK is also branded with your name and logo. All the forms, advertisements, and marketing materials have the look and feel of your credit union. While the PenFed Foundation is offering this program to you, we want it to become your program for your members.

16. Benefit for Your Military Members Eliminates the need for high cost, repeat usage of payday loans Creates opportunity to receive free financial literacy education Allows military personnel to focus on their service and their family And here�s what ARK can actually give your members. First, it eliminates the need for high cost payday loans that users go back to over and over again because they have a reasonable loan product offered by your credit union. ARK also gives servicemembers access to free financial literacy education. ARK has a long standing relationship with Consumer Credit Counseling Services which provides ARK users free one-on-one financial counseling. The counseling identifies the causes of debt and teaches how to create and maintain a budget for long term financial stablility. The Foundation also has a partnership with Veterans Plus, which is an educational nonprofit committed to providing one-on-one support to address and improve the financial circumstances of all past and present service members. Much like Consumer Credit Counseling Services, Veterans Plus offers free financial counseling but geared specifically towards military personnel and their families. The PenFed Foundation�s latest effort to offer financial literacy training to service members is offering ARK users free access to an online financial literacy course. The course is completely online and teaches all the fundamentals of financial literacy including budgeting, saving, and so much. By becoming involved in ARK, service members can learn the financial knowledge they have been lacking and prevent themselves from falling into money troubles again. It can even start them on the track towards saving money for their future and the future of their family. Lastly, ARK allows service members to focus on their duty and their family. ARK can take away the stress of debt leaving service members the opportunity think about the important things in their lives. And here�s what ARK can actually give your members. First, it eliminates the need for high cost payday loans that users go back to over and over again because they have a reasonable loan product offered by your credit union. ARK also gives servicemembers access to free financial literacy education. ARK has a long standing relationship with Consumer Credit Counseling Services which provides ARK users free one-on-one financial counseling. The counseling identifies the causes of debt and teaches how to create and maintain a budget for long term financial stablility. The Foundation also has a partnership with Veterans Plus, which is an educational nonprofit committed to providing one-on-one support to address and improve the financial circumstances of all past and present service members. Much like Consumer Credit Counseling Services, Veterans Plus offers free financial counseling but geared specifically towards military personnel and their families. The PenFed Foundation�s latest effort to offer financial literacy training to service members is offering ARK users free access to an online financial literacy course. The course is completely online and teaches all the fundamentals of financial literacy including budgeting, saving, and so much. By becoming involved in ARK, service members can learn the financial knowledge they have been lacking and prevent themselves from falling into money troubles again. It can even start them on the track towards saving money for their future and the future of their family. Lastly, ARK allows service members to focus on their duty and their family. ARK can take away the stress of debt leaving service members the opportunity think about the important things in their lives.

17. Benefit for Your Credit Union All losses are reimbursed Proven program with operational support from Foundation Branding with your name and logo Foundation supplies marketing materials and pays for ad placements ARK is offered FREE to all credit unions Positive public relations image for members and entire community ARK doesn�t just benefit your members though. It also has a large impact on your credit union overall. -All losses are reimbursed -Proven program with operational support from PenFed Foundation � Foundation shares all necessary procedures and forms and trains your staff on ARK operations. The program has operated in credit unions since 2005 and its been reviewed by the leadership of Consumer Federal of America, Armed Services YMCA, the National Military Family Association, and the American Society of Military Comptrollers. -Program is branded with your name and logo -Foundation supplies marketing materials and pays for ad placements with your branding in local newspapers -ARK is offered FREE to all credit unions and the fee helps cover overhead costs -Positive public relations image for members and entire community because your credit union is offering service members a better option than the predatory payday lenders. Your giving back to a community that gives so much for our country. ARK doesn�t just benefit your members though. It also has a large impact on your credit union overall. -All losses are reimbursed -Proven program with operational support from PenFed Foundation � Foundation shares all necessary procedures and forms and trains your staff on ARK operations. The program has operated in credit unions since 2005 and its been reviewed by the leadership of Consumer Federal of America, Armed Services YMCA, the National Military Family Association, and the American Society of Military Comptrollers. -Program is branded with your name and logo -Foundation supplies marketing materials and pays for ad placements with your branding in local newspapers -ARK is offered FREE to all credit unions and the fee helps cover overhead costs -Positive public relations image for members and entire community because your credit union is offering service members a better option than the predatory payday lenders. Your giving back to a community that gives so much for our country.

18. Dream Makers First-time homebuyers program for those in service of our country�s national security PenFed Foundation will match a buyer�s mortgage nest egg 3 to 1, up to $5,000, for the down payment and closing costs Grant can be used in conjunction with any mortgage company Another wonderful program from the PenFed Foundation that I would like to talk to you briefly about is Dream Makers. Dream Makers is a program for first time homebuyers for those who help keep our country safe. Dream Makers matches a home buyer�s mortgage nest egg 3 to 1 for up to $5,000 to help cover the down payment and closing costs. For example, the PenFed Foundation will award a grant of $5,000 to a someone putting out at least $1,667 towards the purchase of their new home. Meaning the grantee will now have $6,667 to put upfront. The grant can also be used in conjunction with any mortgage company. Grant awardees do not have to be PenFed members and they do not have to receive their mortgage from PenFed.Another wonderful program from the PenFed Foundation that I would like to talk to you briefly about is Dream Makers. Dream Makers is a program for first time homebuyers for those who help keep our country safe. Dream Makers matches a home buyer�s mortgage nest egg 3 to 1 for up to $5,000 to help cover the down payment and closing costs. For example, the PenFed Foundation will award a grant of $5,000 to a someone putting out at least $1,667 towards the purchase of their new home. Meaning the grantee will now have $6,667 to put upfront. The grant can also be used in conjunction with any mortgage company. Grant awardees do not have to be PenFed members and they do not have to receive their mortgage from PenFed.

19. Dream Makers Eligibility Requirements Military (active duty, reserve, national guard, or retired) or Department of Defense or Homeland Security personnel First-time home buyer or have not owned a home for the last 3 years or lost home through divorce or disaster Gross household annual income less than $55,000 or $65,000 in Washington D.C. area or Alaska There are however several requirements for those eligible to receive a grant. -Military (active duty, reserve, national guard, or retired) or Department of Defense or Homeland Security personnel -First-time home buyer or have not owned a home for the last 3 years or lost home through divorce or disaster -Gross household annual income less than $55,000 or $65,000 in Washington D.C. area or Alaska There are however several requirements for those eligible to receive a grant. -Military (active duty, reserve, national guard, or retired) or Department of Defense or Homeland Security personnel -First-time home buyer or have not owned a home for the last 3 years or lost home through divorce or disaster -Gross household annual income less than $55,000 or $65,000 in Washington D.C. area or Alaska

20. Dream MakersEducating First Time Home Buyers PenFed Foundation believes in educating consumers about their financial purchases Grant recipients are required to attend HUD Home Buying Seminar To add to the Foundation�s mission of financial education, grant recipients are required to attend a HUD home buying seminar because understanding the full nature of a large purchase is the key to future success. To add to the Foundation�s mission of financial education, grant recipients are required to attend a HUD home buying seminar because understanding the full nature of a large purchase is the key to future success.

21. Serving Our Nation�s Defenders Join ARK and Dream Makers today and give back to our nation�s brave warriors by helping them achieve the financial security and education they deserve. They�ve done they�re part. Now it�s time to do ours. ARK and Dream Makers are two examples of how philanthropy can be used to better the lives our nation�s service members. The PenFed Foundation believes and strives to make an impact through these programs, but we need your help. So please partner with the PenFed Foundation on ARK and Dream Makers and help make a difference. Your risk is zero but your impact could be infinite. ARK and Dream Makers are two examples of how philanthropy can be used to better the lives our nation�s service members. The PenFed Foundation believes and strives to make an impact through these programs, but we need your help. So please partner with the PenFed Foundation on ARK and Dream Makers and help make a difference. Your risk is zero but your impact could be infinite.

22. Contact Kate Kohler 703-838-1094 Kate.Kohler@penfed.org Dan Schenk 703-838-1335 Daniel.Schenk@penfed.org If you have any questions, please ask myself or Kate. Thank you for listening, and please enjoy the rest of the conference.If you have any questions, please ask myself or Kate. Thank you for listening, and please enjoy the rest of the conference.