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ORIGINS The first known Christmas Club started in 1909, when Merkel Landis, treasurer of the Carlisle (Pennsylvania) Trust Company, introduced the first Christmas savings fund. The club generated 350 customers who saved about $28 each. The January 2 , 1920 , edition of the Belvidere, Illinois Daily Republican announced that the town’s State Farmers Bank was encouraging parents to enroll their children in the Christmas Banking Club :to develop self-reliance and the saving habit." PROMOTION For decades, magazine, business writer James Suroweicki summarized the accounts' appeal: "The popularity of Christmas club accounts isn't a mystery; if their money was in a regular account, people assumed they'd spend it." DRAWBACKS Key drawbacks of Christmas Club accounts included low Interest rates and a high number of restrictions, such as not allowing withdrawals unless Fees were paid. The December 23 , 1949 episode of the radio program Life Of Riley highlighted these problems with an episode featuring Chester Riley visiting the bank to withdraw his Christmas Club money. Riley had made only one $2 deposit, but the account had accumulated so many fees (for the passbook, for early withdrawal, and for the mailing of reminders) that Riley owed the bank another 25 cents. Banks also incurred high costs in maintaining the accounts. According to Dennis Halpin, the CEO for the Capital Communications Federal Credit Union, the union had 3,500 Christmas Club members in 1984. Each member required a check to be produced, signed, collated, and mailed, only for 70 percent to be returned to the bank to deposited in another account. REFERENCES Numismatist, Marilyn A. Reback, pp.57-60, Volume 119, Number 12, December 2006 Pinckney, Barbara. “Holiday Clubs Endure Despite Waning Popularity.” The Business Review (Albany, NY). Nov. 15, 2002. www.bizjournals.com Sewall, Tim. “Christmas Club According Is Becoming a Thing of the Past.” Memphis Business Journal. Dec. 5, 1997. www.bizjournals.com Slabaugh, Arlie R. Christmas Tokens and Medals. Chicago: Author, 1966. (ANA Library Catalogue No. RM85.C5S5) Surowiecki, James. “Bitter Money and Christmas Clubs.” Forbes.com. Feb. 14, 2006. www.forbes.com |
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