Millennial Roundtable: Financial Education
Originally published on CU Insight on April 28, 2015
The millennial generation is known as the most educated generation in history; one-third have earned a Bachelor’s degree or above by age 33. With higher education comes higher debt. Two-thirds of the millennial generation begin their careers with an average of $27,000 in student loan debt according to a 2014 study by the Pew Research Center. Low credit scores, large amounts of debt, a lack of financial know-how, and a culture of immediate gratification puts this generation in a crisis situation unique from any experienced by their parents or grandparents.
Credit unions that supply tools and resources to help Millennials get a better grasp on their finances and manage their debt will be seen as valued and trusted advisors. Millennials will be more likely to seek out advice from a source they trust, and will be more likely to seek out products and services that will help them in the future and remain with your institution long-term; becoming loyal and profitable members. How does your credit union approach financial education for Millennials and what strategies are working for your peers?
Bluepoint held a roundtable discussion with credit union partners to gather from-the-field perspectives. Learn about what strategies your peers have in place when it comes to educating Millennials on the importance of managing finances and being financially responsible.
Mindy Peep, Marketing Communication Manager at Warren Federal Credit Union, speaks about why this crisis is so significant and how credit unions can get involved:
“Many of these young adults watched their parents lose everything during the 2008 economic crisis, or at least know someone’s parents who did. They lost faith in the financial industry as a whole. The average Generation Y credit score is below 680 with $20,000 or more in student loan debt. In that same group of individuals, 9 out of 10 want their own home. What’s wrong with this picture? We have to give this generation the tools and knowledge to manage their finances so that they can obtain deep loyalty products such as mortgages and investments. A mobile app alone can’t do that- we need to educate them as well.”
Chrissy Belle, Vice President of Communications and Culture at Credit Union 1, details how to engage with your local community and why it is important to reach youth in-person by partnering with existing systems:
“One of the main ways we work with young adults is to provide free financial education. We have a robust financial education program and work closely with local area schools to provide classes to students. We also have a physical financial education center in West Anchorage High School that is staffed three days a week. This center holds classes, contests and events, all geared toward teaching high school students the information and tools they will need to be financially healthy once they go out on their own as young adults.”
Mary Isaacs, Executive VP, CFO of Altra Federal Credit Union, offers a different approach more geared towards education for all ages available online to offer a broader range of access to information:
“At Altra, we believe you’re never too young or too old to learn. At each stage of life, our members have different needs and that’s why Altra offers free financial education resources for everyone at every stage of life. For the millennial age group in particular, we have partnered with iGrad, a financial literacy and career resource organization, to offer the best financial education tools and resources available to help college students make informed decisions about financing options. Our Student Choice website offers educational videos, articles, and resources about paying for college, managing your money and much more.”
Whether it’s by explaining the importance of your products and services, engaging in partnership with the local community and school system, or providing education online for easy access, there is a huge opportunity for credit unions to help Millennials succeed financially, focusing on their future. Educating this generation and helping them become financially savvy will significantly increase the likelihood that they will become long-term, loyal, profitable members.
For more insights into millennial preferences and the best ways to reach this generation, read “Capturing the Heart of Millennials: How Community-Focused is Your Institution?”