Making a Difference in Members’ Lives

John SissAla Chairman	Eugene Rosen Treasurer	Doug Allman President/CEO

To Our Members and Friends

Since 1949, we have worked to improve members’ financial well-being by offering products and services that make a difference. We strive to earn your trust and be your first choice in life’s financial decisions.

Over the last 12 months, we continued to use innovation and technology to provide members with more choices, more convenience and more services than ever before. And members responded:

• Hundreds of members refinanced or purchased new homes with our smart, low-interest mortgage loans with budget-friendly payments.
• Thousands of members drove away in their choice of vehicle because of our fast, great-rate auto loans.
• Thousands more unlocked the cash in their home to make home improvements, purchase cars, pay for education and more thanks to flexible home equity loan options.
• And, almost 70,000 members increased their savings as we returned almost $23 million in dividends.

We understand that to continue to make a difference, we need to discover new and better ways to help you manage your finances. In 2007 we listened and delivered.

We Introduced More Choices

To provide members with high-deductible health plans a safe and secure place to save for future medical expenses, we introduced Health Savings Accounts (HSAs). To expand opportunities to save and earn high yields, we introduced two new savings certificate options with low opening balances. The Early Savers Certificate helps young people earn four times the average saving rate and the Add-On Certificate is exactly what beginning savers need to help them save small amounts on a regular basis. And, we enhanced our NASA Federal Visa Program, adding a Visa Platinum with Cash Rewards and six new card designs.

We Improved Our Convenient Access

We made it simple to manage your finances wherever and whenever it’s convenient for you when we introduced eBranch, our new online destination designed to give you access to many of the activities you do at a branch office. Plus, with access to more than 25,000 free ATMs, and 2,600 shared branches throughout the United States, not many financial institutions can match the wide reach of your credit union.

We Expanded Our Service

First, we opened our flagship Greenbelt Branch—a green facility with state-of-the art tools to accommodate greater service. This year we’ll open two more. Second, we enhanced the security of both eBranch Online Banking and Contact-24 Telephone Banking by requiring additional authentication factors—known only by you. And third, we updated our member statement to provide a better organized, easier to read and more complete view of your financial picture including loans, savings, checking and investments.

We Were Involved In Our Communities

In 2007, the members and staff of NASA Federal were active in making a difference in our communities too. We continue to be a title sponsor for Children’s Miracle Network and support the Cherry Blossom 10 Mile Run every year in the Spring. We provide scholarships to highly motivated high school seniors to help fund college educations. We sponsor community Shred Days, the collection of food for area food banks and support many other community organizations such as the Maryland Opera Society.

We are also pleased to report that your credit union continues to see growth and remains very financially sound. Our capital reserves ended the year at almost $97 million or 10.9% of assets. We have assets of $889 million and more than 800 sponsor organizations in our field of membership. We continue to be one of the nation’s top ranked credit unions. And, we’re proud that we have not and will not engage in any sort of subprime mortgage lending.

Over the past 59 years we’ve heard many great stories about our credit union making a difference in members’ daily lives—but we think the best story is always the next one. That is why we work every day to make a difference by empowering people to achieve a brighter financial future.

We know you have many options for financial services and thank you for choosing NASA Federal Credit Union.

Supervisory Committee Report

Robert Hawkins Chairman

The Supervisory Committee serves as your representative and the official auditor of NASA Federal Credit Union. The five-member committee ensures that your credit union conducts its operations and activities in a safe and sound manner by reviewing and evaluating the overall financial operations and ensuring all regulations, procedures and policies that govern this institution are properly followed.

In its primary function, the Supervisory Committee successfully completed all external audit-related activities with the certified public accounting firm of Schreiner, Legge & Company. We will continue to work with Credit Union staff, the Board of Directors and the President of NASA Federal in 2008 to achieve another year of growth and success.

In order to effectively serve as your representative, we welcome your comments. Please write to the Supervisory Committee, P.O. Box 533, Springfield, VA 22150-9839. All inquiries are confidential.

Consolidated Statement Of Income

Consolidated Statement Of Financial Condition

Stay In Touch Anytime, Anywhere

From home or work; in town, around town, or out of town; day or night—you have easy and convenient services to help you access your NASA Federal accounts.

We’re Where You Are

You have free ATM access at more than 25,000 ATMs and 2,600 CU Service Centers* nationwide so you can get quick cash and take care of many of your daily transactions wherever you are. Plus, stop by most area 7-Eleven Stores and local area WAWAs for free ATM transactions. Find a free ATM near you at nasafcu.com/locations.

Make Deposits At The ATM

Did you know you can make deposits through the ATM? It’s possible through the CO-OP, STAR®, Plus and Cirrus® networks, including those at Shared Branch offices. Find one near you at nasafcu.com/locations.

Manage Your Finances Around The Clock

When there’s not enough time in the day to get everything done and still have time for yourself too, stay connected with NASA Federal’s safe, secure eServices:

• eBranch – Get free, 24/7 online account access. View account activity, make transfers and loan payments, get check copies and even download information to Microsoft Money® and Quicken®. Log in to your account today using the ‘eBranch Log In’ button in the left menu.
• eDeposits – You can make deposits online and get immediate credit when you qualify. Then get 7 days to mail the deposit to NASA Federal. Start using eDeposits when you log in to your account using the ‘eBranch Log In’ button in the left menu.
• eStatements – No more clutter. No more waiting for the mail. Get your account statement delivered to you the easy, safe and convenient way. Switch to eStatements at nasafcu.com/enroll.
• eAlerts – Carry your account in the palm of your hand. When you sign up for eAlerts, you stay in touch with your account. eAlerts are free electronic messages about recent account activity delivered by e-mail or text message to your cell phone. Sign up for eAlerts at nasafcu.com/enroll.
• eApplications – It’s never been easier, faster or more convenient to get a loan at NASA Federal. Visit nasafcu.com/apply to get an auto, home equity, education or personal loan.

Plus, you can apply for a low-rate NASA Federal Visa. To apply online for a mortgage, go to nasafcu.com/mortgagecenter.

Let Your Fingers Do The Walking

Need to check account or loan balances, transfer money or make loan payments? Call Contact-24, NASA Federal’s free telephone banking service any time, day or night. Dial 301-249-1234 or toll-free 1-888-424-NASA. A handy guide to Contact-24 is available at nasafcu.com/Contact24.

Take advantage of all the convenient services NASA Federal has to offer. Get account access whenever and wherever it’s most convenient for you.

*Services, hours and cash limits differ at each location.

Watch Out For Schemes That Promise To Eliminate Debt

There is one thing you can count on from crooks and scam artists – they prey on good people in trouble. With many of today’s consumers facing dire times with mortgage debt, credit card debt and other types of loan issues, the latest scam is to promise that for a small fee you can eliminate your debt entirely. Don’t fall victim. Not only will you not get anything for your money, your identity could be stolen in the process.

Here’s How It Works:

1. You receive an e-mail offering you a way to pay off your debt for a small fee.
2. The e-mail then asks you to divulge your social security, account and/or credit card number to help with the outstanding amount.
3. When you take this step, you lose your money and your account may be used to make fraudulent purchases, damaging your credit rating.

Everyone experiences anxiety when their funds are low, but don’t panic. It’s easier to establish and maintain a good credit record than to repair a bad one. For help getting out of debt, NASA Federal offers BALANCE – the helpful and confidential education and counseling service for families and individuals. Take control of your finances and visit nasafcu.com/balance today. For more information on precautions you can take to reduce your risk of identity theft, visit nasafcu.com/idtheft. For personal assistance with paying a NASA Federal loan, call 301-249-1800.

Looking Forward To A Tax Rebate? SAVE IT!

Are you anticipating a tax rebate from the government this year? People who file their tax returns by April 15th can benefit from the economic stimulus plan and get cash in hand as early as May! Here’s the tax rebate schedule:

DIRECT DEPOSIT PAYMENTS

Paper Check By Mail

Not sure what to do with your share? Why not stash that cash away at the Credit Union? Get your rebate first when you direct deposit to your checking or savings account. Use routing number 255077833.

Ten Great Ways To Spend Your Tax Refund

Expecting a substantial income tax refund this year? Rather than having those precious dollars absorbed into your normal spending routine, get the most out of your cash. Here are ten great ways to spend an income tax refund:

1. Pay down high interest loans and lines of credit.
2. Fund your retirement account.
3. Invest in your child’s education.
4. Open an emergency account.
5. Pay for car or home repairs.
6. Start a personal endowment.
7. Make an extra home mortgage payment (or two).
8. Donate to a charity.
9. Open a 529 College Savings Plan.
10. Plan a vacation.

Although these ideas are excellent uses for a lump-sum amount of cash, remember that instead of planning for a refund, it’s best to come out even. A tax refund is an interest-free loan to the government, and money that is not in your pocket every month. If you get a refund back each year, consider changing your withholding exemptions so less tax is withheld from each paycheck. While a tax refund may feel like a gift from Uncle Sam, it’s not—it’s money that could be earning dividends throughout the year.

Proud To Support Pike’s Peek 10K!

NASA Federal is proud to support the Montgomery County Road Runners Club's Pike's Peek 10K and Kid's Run! The mission of MCRRC is to promote and encourage running for all ages. One of the largest, most active running clubs in the nation, MCRRC is known for their low-key, high-quality club races, training runs, special events and other activities. So come see what MCRRC is all about and help us cheer on the runners! Join us April 27th at 8 a.m. in Rockville, Md. for the festivities. Visit mcrrc.org for all the details.

Direct Deposit Your Tax Refund

Be sure to choose direct deposit of your income tax refund. Just enter your credit union account number (savings or checking) and the NASA Federal Credit Union routing number: 255077833.