Most people participate through payroll deduction, either through a credit union linked to their employer, or through an employer-sponsored club. The interest they earn is modest, to say the least. Calls to a handful of credit unions around St. Louis found interest rates running about 3 percent to 3.3 percent. But a Christmas club requires no minimum balance to start. That makes the clubs a rather painless way to save for people who don't have much savings to begin with.
Credit unions say they're getting a bigger share of the club pie.
Most big banks have dropped it from the product line. Bankers dispute that statement, however. In fact, some banks report that demand for Christmas Cubs is actually rising lately.