The NEW GIMMICKY Credit Union??

Many of the finance stories of the past few years present BIG BAD BANKS vs LITTLE VIRTUOUS CREDIT UNIONS. One area credit union even runs an ad saying, "People not profits." Yeah, I'm a fan.

But a recent experience makes me wonder if the credit unions are going the way of the big bad banks with confusing products, over-complexity, and incompetent reps.

Both my kids have checking/savings accounts at a credit union. I opened these to accommodate the dribs and drabs of money they occasionally received as gifts. I also appreciated the FREE CHECKING. So this is what they have.

Here is the latest missive. LACAP will no longer offer the FREE CHECKING. As of May 1, you will be automatically transferred to an XXX account. Checking will remain free if you have 10 NON-ATM Debit transactions per month or Direct Deposit. If you don't use your debit card enough, you will be charged $8.00/month.

Well, guess what? Frugal Son can't have his French salary direct-deposited! He needs the debit card for occasional cash withdrawals.

Miss Em doesn't have an income to be direct deposited. And she doesn't need the hassle of keeping count of her debit transactions.

So I called. The first rep suggested that I set up a Direct Deposit from MY checking account for them--say $5/month. Good idea! Of course, when I called back the next day, the new rep said that would not be permitted.

She referred me to their range of checking accounts. All were of the DO THIS AND YOU GET THIS, but if YOU DON'T DO THIS, YOU GET THIS (GREATER) PENALTY.

My head started spinning. This is a sign of over-complexity and deliberate efforts to confuse.

My favorite is their IRA. WITH A 7% RATE. The small print says the 7% rate is good till the end of 2012--so for 8 months. After that--still tiny print--it reverts to the regular rate of .5%. That's POINT 5, not 5.

P.S. Don't tell me I'm being a helicopter! Frugal Son is in France and can't deal with this. Miss Em is in Alabama and working hard. I'm hoping they will return the favor* when I'm too old to manage.

*Example of returning the favor: Frugal Son will be meeting his Grandma in the Vienna airport in a few days. They will be visiting the city of her birth. He has planned the whole trip, made all the reservations, and will be taking her around with his German friend Floh.